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BURNABY, BC, Sept. 14 /CNW/ - Legend Power Systems Inc. (TSX.V: LPS) ("Legend Power") announces that it has completed the first tranche of its previously announced brokered private placement (the "Brokered Offering") of up to 15,000,000 units (the "Units") at a price of $0.50 per Unit for gross proceeds of up to $7,500,000. Each Unit consists of one common share of Legend Power (a "Share") and one half of one common share purchase warrant (a "Warrant"). Each whole Warrant entitles the holder thereof to purchase one Share at a price of $0.60 per Share until March 10, 2011. The first tranche of the Brokered Offering resulted in the sale of 8,778,000 Units for gross proceeds of $4,389,000.
Gerry Gill, Chairman & CEO of Legend Power stated: "We are elated that our company's efforts in raising new capital at a difficult time in the financial markets have resulted in such a strong showing of confidence in our company as well as our product. This new capital will finally allow us to implement a strong sales initiative to penetrate markets in British Columbia, Ontario and the United States. We wish to sincerely thank all our investors, agents and advisors for their resilient support."
D&D Securities Company (the "Agent") acted as lead agent, with Canaccord Capital Corporation participating in the selling group. Legend Power has paid to the Agent an aggregate cash commission and advisory fees equal to $262,650, and has issued to the Agent broker warrants (the "Broker Warrants") to acquire 867,800 Units. Each Broker Warrant is exercisable at $0.50 per Unit until March 10, 2011. Legend Power has also paid to Canaccord Capital Corp. a cash commission equal to $3,000.
In addition, Legend Power has completed a non-brokered private placement of 200,000 Units at a price of $0.50 per Unit for gross proceeds of $100,000 (the "Non-Brokered Offering of Units") and its previously announced non-brokered private placement of 100,000 Shares at a price of $0.45 per Share for gross proceeds of $45,000 (the "Non-Brokered Offering of Shares"). The total gross proceeds from the first tranche of the Brokered Offering, the Non-Brokered Offering of Units and the Non-Brokered Offering of Shares are $4,534,000.
Legend Power previously announced that it had entered into two agreements with Phoenix Alliance Corp. ("Phoenix") - a management consulting agreement (the "Consulting Agreement") and a finder's fee agreement (the "Finder's Fee Agreement"). In accordance with the Consulting Agreement, Legend Power has paid Phoenix $79,288.37 in cash and issued to Phoenix 438,400 Shares (433,900 Shares at a deemed price of $0.50 per Share and 4,500 Shares at a deemed price of $0.45 per Share). As previously disclosed, Legend Power has already paid Phoenix $25,000 pursuant to the Consulting Agreement. In addition, and in accordance with the Finder's Fee Agreement, Legend Power paid Phoenix a cash fee of $219,200, being 5% of the value of the subscriptions paid by investors in the Brokered Offering and the Non-Brokered Offering of Shares who were introduced to Legend Power by Phoenix. Any fees and expenses payable to the Agent in connection with the Offering have been deducted from any amounts payable to Phoenix under the Consulting Agreement and the Finder's Fee Agreement.
All securities issued under the Brokered Offering, the Non-Brokered Offering of Units and the Non- Brokered Offering of Shares, and any Shares issuable on the exercise of the Warrants, have a hold period expiring January 11, 2010. In addition, 15% of the Shares issued to Phoenix are subject to a hold period expiring February 11, 2010, 15% of the Shares issued to Phoenix are subject to a hold period expiring March 11, 2010, 15% of the Shares issued to Phoenix are subject to a hold period expiring April 11, 2010, 15% of the Shares issued to Phoenix are subject to a hold period expiring May 11, 2010, 15% of the Shares issued to Phoenix are subject to a hold period expiring June 11, 2010 and 15% of the Shares issued to Phoenix are subject to a hold period expiring July 11, 2010.
The proceeds from the Brokered Offering, the Non-Brokered Offering of Units and the Non-Brokered Offering of Shares will be used to execute its sales and marketing plan, both in Canada and in the United States, to repay certain notes payable, which will significantly improve Legend Power's balance sheet, and for general corporate purposes.
About Legend Power Systems Inc.
Legend Power Systems Inc. is a leading electrical energy conservation company that manufactures and markets a patented device to help commercial and industrial customers achieve significant energy savings through voltage optimization. Legend Power's Electrical Harmonizer-AVR eliminates inefficiencies by delivering the optimal level of voltage a user needs. Many customers receive higher voltage levels than required at certain points of the grid from electrical utilities delivering higher levels to compensate for line loss across the feeder length. Higher than nominal voltage can affect the lifespan of electrical equipment and result in high monthly utility bills. By delivering the optimal voltage to the user, Legend Power's Electrical Harmonizer-AVR helps companies reduce their electricity bills, maintenance costs and greenhouse gas emissions while increasing the life of electrical equipment. The technology also decreases capital and operating costs for electrical utilities.
Neither TSX Venture Exchange nor its Regulation Services Provider (as
that term is defined in the policies of the TSX Venture Exchange) accepts
responsibility for the adequacy or accuracy of this release.
This news release does not constitute an offer to sell or the solicitation of an offer to buy any of the Shares in the United States. The Shares have not been and will not be registered under the U.S. Securities Act of 1933 or any state securities laws, and may not be offered or sold in the United States without registration under the U.S. Securities Act of 1933 and all applicable state securities laws, or an applicable exemption from registration requirements.
SOURCE Legend Power Systems Inc.
For further information: For further information: Gerry Gill, Chairman & CEO, Legend Power Systems Inc., (604) 420-1500, email@example.com; LEGEND POWER SYSTEMS INC., 8618 Commerce Court, Burnaby, BC, V5A 4N6, (604) 420-1500, www.legendpower.com