16:07:05 EDT Sat 12 Jun 2021
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P Squared to seek holder OK for CPC changes June 16

2021-06-10 19:23 ET - News Release

Mr. Shabir Premji reports

P SQUARED RENEWABLES INC. ANNOUNCES CHANGES IN ACCORDANCE WITH NEW CPC POLICY

Due to changes recently announced by the TSX Venture Exchange to its capital pool company program and changes to the TSX-V's Policy 2.4 (Capital Pool Companies), which became effective as at Jan. 1, 2021, P Squared Renewables Inc. intends to implement certain amendments to further align its policies with the new CPC policy, subject to TSX-V approval.

Pursuant to the new CPC policy, for the company to align certain of its policies with the new CPC policy, it is required to obtain the approval of disinterested shareholders of the company. As a result, the company will be seeking such approval at its coming annual general and special meeting of shareholders scheduled to be held on June 16, 2021, for the following matters: (i) to remove the consequences of failing to complete a qualifying transaction within 24 months of the company's date of listing on the TSX-V; (ii) to amend the escrow release conditions and certain other provisions of the company's escrow agreement; (iii) to permit the payment of a finder's fee or commission to a non-arm's-length party upon completion of the qualifying transaction; and (iv) to amend the company's stock option plan. These proposed amendments are described in further detail below.

Removal of the consequences of failing to complete a QT within 24 months of the listing date

Currently, under the exchange's Policy 2.4 (Capital Pool Companies) (as at June 14, 2010), there are certain consequences if a QT is not completed within 24 months of the listing date. These consequences include a potential for common shares of the company to be delisted or suspended, or, subject to the approval of the majority of the company's shareholders, the transfer of the shares to list on the NEX and the cancellation of certain seed shares. The new CPC policy has removed these consequences assuming disinterested shareholder approval is obtained. The company intends to ask disinterested shareholders to approve the removal of such consequences at the meeting, as it believes that it will afford the company greater flexibility to complete a QT that is beneficial to all interested parties, and will also allow the company to better withstand market volatility.

The resolution approving the removal of the consequences for failing to complete a QT within 24 months of the listing date requires disinterested shareholder approval. The following directors and officers, who, in aggregate, hold or control, directly or indirectly, 5.1 million common shares, will be excluded from the vote: Shabir Premji, Jack Pastuszko and Daniel Kenney.

Amendments to the escrow agreement

The company intends to ask disinterested shareholders to approve the company making certain amendments to the escrow agreement, including allowing the company's escrowed securities to be subject to an 18-month escrow release schedule as detailed in the new CPC policy, rather than the current 36-month escrow release schedule in the former policy. In addition, the company wishes to amend the escrow agreement such that all options granted prior to the date the exchange issues a final bulletin for the QT and all shares that were issued upon exercise of such options prior to the date of the final QT exchange bulletin will be released from escrow on the date of the final QT exchange bulletin, other than: (a) options that were granted prior to the initial public offering with an exercise price that is less than the issue price of the shares issued in the IPO; and (b) any shares that were issued pursuant to the exercise of such options, which will be released from escrow in accordance with the 18-month escrow release schedule as detailed in the new CPC policy.

The resolution approving the amendments to the escrow agreement requires disinterested shareholder approval. All parties to the escrow agreement, who, in aggregate, hold or control, directly or indirectly, eight million shares, including the following directors and officers the company, will be excluded from the vote: Mr. Premji, Mr. Pastuszko and Mr. Kenney.

Permit the payment of a finder's fee or commission to a non-arm's-length party

The new CPC policy includes changes which permit a capital pool company to pay finders' fees or commissions to a non-arm's-length party to the company upon completion of a QT. At the meeting, the disinterested shareholders will be asked to approve the payment of finders' fees or commissions to non-arm's-length parties to the company upon completion of a QT, in accordance with the new CPC policy.

The resolution approving the payment of a finder's fee or commission to a non-arm's-length party requires disinterested shareholder approval. The following directors and officers, who, in aggregate, hold or control, directly or indirectly, 5.1 million common shares, will be excluded from the vote: Mr. Premji, Mr. Pastuszko and Mr. Kenney.

Amendments to the option plan

The amendments to the option plan are as follows: (i) include provisions providing for the payment or financing or any income tax withholdings applicable to the exercise of options; (ii) clarify what constitutes a change of control of the company, and provide that the options may be exercised within 90 days of the change of control; (iii) include provisions relating to blackout periods during which optionholders cannot exercise options; and (iv) other housekeeping changes of a non-material nature.

The resolution approving the removal of the amendments to the option plan requires disinterested shareholder approval. The following directors and officers, who, in aggregate, hold or control, directly or indirectly, 5.1 million common shares, will be excluded from the vote: Mr. Premji, Mr. Pastuszko and Mr. Kenney.

All matters submitted to shareholders of the corporation for approval at the meeting are more particularly described in the corporation's management information circular dated May 12, 2021. Please refer to the circular for further details with respect to the amendments associated with the new CPC policy.

We seek Safe Harbor.

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