Pepcap Ventures completes private placement program

By Romel S. Gurky

TSX-listed capital pool company Pepcap Ventures Inc. said Thursday it has closed the previously announced brokered private placement of 6,500 subscription receipts of the corporation for gross proceeds of $650,000 with Industrial Alliance Securities Inc acting as agent.

The company said in a statement that the brokered offering was completed in connection with its plan to acquire 51 percent of the total issued and outstanding shares of Asia Mining and hold an indirect controlling interest in PT Krida Darma Andika, a 99.6 percent owned subsidiary of Asia Mining that owns mining concessions in Sumatra, Indonesia, divided into two coal blocks, including three coal concessions that are located in the Napal Putih and Putri Hijau districts of North Bengkulu Regency of Bengkulu Province.

The company provided the following further explanation in the statement. Each Subscription Receipt will be automatically exchanged immediately prior to the completion of the aualifying transaction (without any further action by the holder of such Subscription Receipt and for no further payment) for one 8% convertible secured debenture (?Convertible Debenture?) with a par value of $100 per Convertible Debenture and a 36 month maturity period, convertible at the election of the debenture holder at any time into common shares of the Corporation (?Pepcap Shares?) at a conversion price of $0.15 per Pepcap Share, subject to conventional anti-dilution adjustments and to certain escrow release conditions.

The proceeds from the brokered offering have been deposited in escrow (Escrowed Funds) with Alliance Trust Company pending closing of the qualifying transaction and certain connected transactions. If the qualifying transaction and/or certain connected transactions do not close, the Escrowed Funds will be returned to the subscribers of the brokered offering. The proceeds from the brokered offering, once released from escrow, will be used for an exploration program on the Properties, for general and administrative purposes and for expenses of the qualifying transaction. The subscription receipts, convertible debentures and underlying Pepcap shares will be subject to a 4 month hold in accordance with applicable securities law.

Pepcam Ventures also said it expects to complete a non-brokered private placement (the non-brokered offering?, and together with the brokered offering, the ?financing?) in connection the qualifying transaction, the aggregate gross proceeds of the Financing being up to a maximum of $1,500,000.

Editing by Reiner Simanjuntak