Colonial Coal International Entered Into Letter of Agreement for Private Placement and Flatbed Property Interest Acquisition

May 2, 2016

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Colonial Coal International (TSXV: CAD) has announced it has entered into a new letter agreement with an investor group that provides for terms and conditions of each of a proposed private placement of units of CCI together with the corresponding agreement by the investor group to acquire a 10 percent registered and beneficial ownership interest in the Corporation’s Flatbed Property. It will become available to the investor group upon successful completion of the private placement.

David Austin, CEO and president of CCI said:

“I am very pleased that we have been able to re-establish a potential long-term partner for the development of the company’s various property and business interests. We are hopeful that this partnership will continue to grow as Colonial Coal explores its many options going forward”.

As quoted in the press release:

Private Placement

In conjunction with the proposed Private Placement the Corporation has agreed to sell 24,000,000 units (each a “Unit“) of the Corporation; representing approximately 1 9.866% of the presently issued and outstanding common shares of the Corporation (each a “Common Share“) as of the date hereof on a non-diluted basis; to the Investor at a price of $0.10 per Unit for gross proceeds of $2,400,000. Each Unit is comprised of one Common Share and one Common Share purchase warrant (each a “Warrant“) of the Corporation, with each such Warrant entitling the Investor to purchase an additional Common Share at an exercise price of $0.20 per Common Share for a period of two years from closing of the Private Placement (the “Private Placement Closing“). The Private Placement is expected to close by May 9, 2016.

No finder’s fees will be payable by the Corporation in connection with the completion of the Private Placement.

Closing of the Private Placement is subject to a number of conditions, including receipt of all necessary corporate and regulatory approvals, inclusive of that of the TSX Venture Exchange (the “Exchange“). In accordance with the policies of the Exchange, the Corporation may be required to obtain disinterested shareholder approval (the “Disinterested Shareholder Approval“) to the Investor becoming a “Control Person” (as defined by Policy 1.1 of the Exchange) by virtue of any Warrant exercise which would cause the Investor to hold more than 20% of the outstanding Common Shares. The Corporation shall attend to obtaining Disinterested Shareholder Approval as soon as reasonably practicable after the Private Placement Closing.

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Category: General