MIJDRECHT, The Netherlands, May 27, 2011 /CNW/ - Panta Holdings B.V.
("Panta") is issuing this press release with respect to common shares
("Common Shares") of Avcorp Industries Inc. ("Avcorp" or the
"Issuer"). Panta, through a wholly-owned subsidiary, has agreed to
provide the Issuer with a $6,000,000 principal amount, 10% secured
five-year term loan (the "Term Loan"). The Term Loan is secured by the
assets of the Issuer and is subordinate to other pre-existing debt
instruments of the Issuer.
The Term Loan contains a conversion right to convert all or any portion
of the principal amount of the Term Loan, as elected by Panta, at a
conversion price of $0.07 per Common Share, into up to 85,714,286
Common Shares (the "Conversion Right"). The Term Loan may be converted
on or before the Term Loan's maturity. Interest on the Term Loan is not
As per the requirements of the Toronto Stock Exchange, the Conversion
Right is subject to disinterested shareholder approval, and the Issuer
will seek such approval at its 2011 annual meeting of shareholders to
be held on June 16, 2011 (the "Meeting"). If the Conversion Right is
not approved at the Meeting, the Term Loan will not be convertible into
Common Shares and the interest rate on the Term Loan will be changed
from 10% per year to 15% per year as of July 2011.
As partial consideration for the Term Loan, Avcorp will issue to Panta,
19,550,532 Common Share purchase warrants (the "Panta Warrants"), each
Panta Warrant exercisable on or before January 1, 2015 with respect to
one Common Share at an exercise price of Cdn.$0.0713 per Common Share.
The issuance of the Panta Warrants does not require shareholder
approval but is subject to TSX approval.
Panta currently beneficially owns or exercises control over 88,314,176
Common Shares (representing approximately 45.2% of the current issued
and outstanding Common Shares) and also holds, through a wholly-owned
subsidiary, a $1,771,000 principal amount 6% secured note convertible
into up to 29,516,666 Common Shares (the "Existing Convertible Loan").
As a result of the Conversion Right and the issuance of the Panta
Warrants, a total of 105,264,818 additional Common Shares are being
made issuable to Panta (representing approximately 53.8% of the current
issued and outstanding Common Shares).
Assuming the full conversion of the Existing Convertible Loan, the
exercise of the Panta Warrants and the full conversion of the Term Loan
pursuant to the Conversion Right, Panta will own or exercise control
over 223,095,660 Common Shares (representing approximately 67.5% of the
Common Shares outstanding after given effect to all such exercises and
The Term Loan was made for investment purposes. Panta may, depending on
market and other conditions, increase or decrease its beneficial
ownership of the Issuer's securities, subject to general market
This press release is being issued pursuant to the requirements of Part
3 of National Instrument 62-103 The Early Warning System and Related Take-Over Bid and Insider Reporting
Issues of the Canadian Securities Administrators. A copy of the report to be
filed by Panta in connection with the transactions described herein
will be available on the Issuer's SEDAR profile at www.sedar.com, and can also be obtained by contacting the Corporate Secretary of
Panta at the telephone number listed below.
SOURCE Panta Holdings B.V.
For further information:
Panta Holdings B.V.
Rendementsweg 2, 3641 SK Mijdrecht
P.O. Box 87, 3640 AB Mijdrecht
Tel. +31 297 256283