Pinetree Capital Ltd. Announces $40 Million Private Placement
June 20, 2008
NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES
TORONTO, Canada (June 20, 2008) – Pinetree Capital Ltd. (“Pinetree” or the “Company”) (TSX: PNP) is pleased to announce that it has entered into an agreement with Genuity Capital Markets and PowerOne Capital Markets Limited, as co-lead agents on behalf of a syndicate of agents, including Canaccord Capital Corporation and Thomas Weisel Partners Canada Inc. (collectively, the “Agents”) to complete a best efforts private placement financing to raise up to $40 million through the issuance and sale of up to 16,000,000 units of Pinetree at a price of $2.50 per unit (a “Unit”). Each Unit will be comprised of one common share of Pinetree and one-half of one common share purchase warrant. Each whole common share purchase warrant will entitle the holder to acquire one common share of Pinetree, at an exercise price of $3.50 per common share for a period of 5 years following the closing of the financing. Closing is expected to occur on or about July 11, 2008.
Pinetree has also granted to the Agents an over-allotment option (the “Option”) to sell up to an additional 15% of the number of Units in the financing. The Option is exercisable at any time up to the time of closing of the private placement. If the Option is exercised in full, an aggregate of 18,400,000 Units will be sold under the private placement, representing gross proceeds to Pinetree of $46 million. It is anticipated that the net proceeds of the private placement will be used by Pinetree for future investment activities, debt repayment and for general corporate purposes.
As consideration for their services, the Agents will receive a cash commission equal to 5.5% of the gross proceeds raised in the private placement and compensation warrants (the “Compensation Warrants”) entitling the Agents to purchase such number of common shares equal to 5.5% of the aggregate number of Units sold pursuant to the private placement. Each Compensation Warrant will entitle the Agents to purchase one common share of the Company at a price of $2.72 per common share for a period of 24 months following the closing
Completion of the private placement is subject to certain conditions including, but not limited to, the receipt of all necessary approvals including the approval of the TSX. The Units may be acquired by purchasers in all of the provinces of Canada pursuant to applicable exemptions from the prospectus requirements and by offshore purchasers, including in the United Kingdom pursuant to applicable exemptions.
Up to 4,200,000 of the Units may be purchased by insiders of Pinetree. Pinetree owns 50% of the outstanding shares of PowerOne Capital Markets Limited, the co-lead agent under the private placement, and is considered a related and connected issuer of PowerOne.
Pinetree Capital Ltd. ("Pinetree") was incorporated under the laws of the Province of Ontario and its shares are publicly-traded on the Toronto Stock Exchange (“TSX”) under the symbol “PNP”. Pinetree is a diversified investment and merchant banking firm focused on the small cap market. Pinetree’s investments are primarily in the resources sector: Uranium, Oil & Gas, Molybdenum, Precious Metals, Potash and Rare Earths, and Base Metals. Pinetree’s investment approach is to develop a macro view of a sector, build a position consistent with the view by identifying micro-cap opportunities within that sector, and devise an exit strategy designed to maximize our relative return in light of changing fundamentals and opportunities.
For more details about Pinetree and its investments, please visit our website at www.pinetreecapital.com
Larry Goldberg, C.A.
Executive Vice President and Chief Financial Officer
Pinetree Capital Ltd.
130 King Street West, Suite 2500
Toronto, Ontario, Canada, M5X 1A9
Web Site: www.pinetreecapital.com
This news release contains forward-looking statements within the meaning of applicable Canadian securities laws. These forward-looking statements are subject to risks and uncertainties and other factors that may cause Pinetree’s results to differ materially from expectations. These include risks relating to market fluctuations, investee performance and other risks. These forward-looking statements speak only as of the date hereof. Pinetree disclaims any intent or obligation to update these forward-looking statements, except as required by law.