EComm Systems Corporation (CDNX: ES.U) announced today that it has closed a US$10.4 million private placement of convertible preferred stock. The funding was initially announced in a news release dated April 3. Following a ten-day trading period, the shares were priced at US$1.30.
Major investors in the private placement include Circle-T Partners, New York and TAL Investment Management, Toronto, Ontario. EComm’s Chairman and CEO, William A. Zemlak, remarked, “The quality of the institutions and individuals that have chosen to invest with us speaks for itself. We couldn’t be more pleased to have their involvement.”
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The purchasers of the preferred shares will have the right to convert their shares at any time into common shares of the Company on a one-to-one basis. All of the preferred shares will be automatically converted into common shares in the event of the closing of a firm-commitment underwritten public offering pursuant to an effective registration statement under the Securities Act of 1933, as amended, providing for the offer of common shares to the public in an aggregate offering amount of not less than U.S.$20 million, and an offering price per share of the lesser of at least 150% of the then-applicable conversion price, and at least 125% of the then-applicable conversion price in the case of an offering completed within one year after the closing of this private placement. The Company may elect to convert the preferred shares into common shares in the event that the Company’s common stock closes in excess of U.S.$3.50 and has traded an aggregate volume in excess of 1,500,000 shares in a 30 day period.
EComm (CDNX: ES.U) is a publicly traded Delaware corporation listed on the Canadian Venture Exchange. With seven of the top national foodservice equipment distributors as partners, the company’s first operating unit, COMMkitchen.com, began providing web-based marketing and purchasing options in the $13 billion commercial food service industry in late 1999. The company anticipates adding other operating units that will provide marketing and distribution in a variety of industries. Additional information can be found at www.ecommsystems.net.
This news release may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21B of the Securities Act of 1934, such as estimates and statements that describe EComm Systems’ future plans, objectives or goals. These statements may include words to the effect that EComm Systems or management expect stated conditions or results to occur. Since forward-looking statements address future events and conditions, by their very nature, they involve inherent risks and uncertainties. Accordingly, actual results or events may differ materially from those currently anticipated in such statements. Please refer to the risk factors identified in the Information Circular for the Extraordinary General Meeting of Dome Ventures Inc. dated October 15, 1999. The Canadian Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this news release.
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