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Toronto, Ontario--(Newsfile Corp. - August 25, 2022) - DelphX Capital Markets Inc. (TSXV: DELX) (OTCQB: DPXCF) ("DelphX"), a leader in the development of new classes of structured products for the fixed income market, announced today a non-brokered private placement of 4,825,715 units of the Company (the "Units"), at a premium to market subscription price of CAD$0.14 per Unit, for aggregate gross proceeds of approximately CAD$675,600 (the "Offering").
Each Unit consists of one (1) common share of the Company (a "Common Share") and one Common Share purchase warrant ("Warrant"). Each Warrant will be exercisable at CAD$0.30 and entitle the holder thereof to acquire one Common Share for a period of two years from the date of issuance. The use of proceeds will be for operational purposes to support the launch of the Company's proprietary Collateralized Put Options (CPOs) and Collateralized Reference Notes (CRNs).
Insiders participated in the Offering subscribing for 1,429,286 Units, and as a result the Offering is considered a "related party transaction" within the meaning of Multilateral Instrument 61-101 Protection of Minority Security Holders in Special Transactions ("MI 61-101"). DelphX has relied on the exemptions from the formal valuation and minority approval requirements of MI 61-101 contained in sections 5.5(a) and 5.7(1)(a) of MI 61-101 in respect of related party participation, as neither the fair market value of the securities issued to insiders nor the cash consideration paid for such securities exceeded 25% of DelphX's market capitalization. A material change report was not filed more than 21 days prior to closing of the Offering as the participation of insiders in the Offering and the extent of such participation was not finalized until shortly prior to the completion of the Offering.
In connection with the Offering, DelphX will pay cash finder's fees of $7,007 and issue 50,050 finders' warrants (the "Finders' Warrants") to AlphaNorth Asset Management, an eligible finder. The Finders' Warrants will be exercisable at CAD$0.30 each for a period of two years after issuance.
Completion of the Offering is subject to the final approval of the TSXV. The Shares issued pursuant to the Offering will be subject to a hold period of four months plus one day from the date of issuance.
"Since going live, DelphX has entered an exciting new phase where we can now demonstrate the effectiveness of our proprietary products with actual as opposed to simulated results," said DelphX CEO Patrick Wood. "The last few months have been a busy time, where we have been engaging with managers of large bond portfolios and Broker-Dealers to demonstrate the advantages of our proprietary products over traditional Credit Default Swaps (CDSs) and other historically flawed solutions for managing yield and risk. The recent difficulties in settling CDSs connected to Russian Bond defaults provided a perfect backdrop to the significant advantages built into our product offerings, which are fully collateralized at inception and have built-in settlement terms in the case of default. This offering has been sized appropriately in order to maintain a strong balance sheet ahead of anticipated revenue streams from adoption of our products. We are excited by the quality of the relationships we are forging and look forward to providing additional updates in coming months."