Closing of Private Placement of Units

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VANCOUVER, B.C. – May 17, 2021 Strategem Capital Corporation. (TSX-V: SGE) (“Strategem” or the “Company”) is pleased to announce that further to its news release dated May 5, 2021 the Company has closed its non-brokered private placement of 5,191,229 units of the Company (the “Units”) at $2.29 per Unit for aggregate gross proceeds of $11,887,914.41 (the “Offering”).

Each Units consists of one common share in the capital of the Company (each, a “Share” and collectively, the “Shares”) and one common share purchase warrant (each, a “Warrant”). Each Warrant entitles the holder thereof to acquire one additional common share (a “Warrant Share”) at a price of $2.75 per Warrant Share for a period of 36 months following the closing of the Offering; provided, however, that if at any time the closing price of the Company’s Shares is equal to or greater than $10.00 per Share for a period of 15 consecutive trading days, the Company may accelerate the expiry date of the Warrants by giving notice to the holders thereof and in such case the Warrants will expire on the 30th business day after the date on which such notice is given by the Company in accordance with its terms.

All securities issued in connection with the Offering will be subject to a statutory four month hold period expiring on September 18, 2021 in accordance with applicable securities legislation.

The Company intends to use the net proceeds raised from the Offering for general working capital and investment purposes.

Seven insiders of the Company participated in the Offering and subscribed for a total of 4,620,040 Units for gross proceeds of $10,579,891.60. Such participation is considered to be a “related party transaction” as defined under Multilateral Instrument 61-101 (“MI 61-101”). The transaction is exempt from the formal valuation and minority shareholder approval requirements of MI 61-101, as neither the fair market value of any securities issued to insiders nor the consideration paid by such persons exceeded by 25% of the Company’s market capitalization.

The securities being offered have not been, nor will they be, registered under the United States Securities Act of 1933, as amended, and may not be offered or sold in the United States or to, or for the account or benefit of, U.S. persons absent registration or an applicable exemption from the registration requirements. This news release will not constitute an offer to sell or the solicitation of an offer to buy nor will there be any sale of the securities in any State in which such offer, solicitation or sale would be unlawful.

All references to currency in this news release are to Canadian currency.

Early Warning Disclosure

In connection with the Offering, 2023378 Ontario Inc. (“2023378”) acquired 1,655,000 Units at a price of $2.29 per Unit. Immediately prior to the Offering, 2023378 held 1,500,000 Shares, representing 35.33% of the issued and outstanding Shares of the Company. Following the Offering, 2023378 will have ownership or control over 4,810,000 Shares issued or Shares issuable or 43.36% of the Shares of the Company on a partially diluted basis.

SKKY Capital Corporation Limited (“SKKY Capital”) acquired 1,655,000 Units at a price of $2.29 per Unit. Immediately prior to the Offering, SKKY Capital held 1,522,200 Shares, representing 35.85% of the issued and outstanding Shares of the Company. Following the Offering, SKKY Capital will have ownership or control over 4,832,200 Shares issued or Shares issuable or 43.57% of the Shares of the Company on a partially diluted basis.

The securities were acquired by 2023378 and SKKY Capital for investment purposes and they may increase or decrease their respective beneficial ownership of the Company in the future.

The early warning reports required by National Instrument 62-103 – The Early Warning Systems and Related Take-Over Bid and Insider Reporting Issuer will be filed in accordance with applicable securities laws and under the Company’s SEDAR profile at


Jo-Anne O’Connor

Jo-Anne O’Connor

Chief Executive Officer

Neither the 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.

Forward-Looking Statements

This news release contains certain forward-looking statements, including, but not limited to, expectations as to the use of proceeds from the Offering and final acceptance by the TSX Venture Exchange. Wherever possible, words such as “may”, “will”, “should”, “could”, “expect”, “plan”, “intend”, “anticipate”, “believe”, “estimate”, “predict” or “potential” or the negative or other variations of these words, or similar words or phrases, have been used to identify these forward-looking statements. These statements reflect management’s current beliefs and are based on information currently available to management as at the date hereof.  Forward-looking statements involve significant risk, uncertainties and assumptions. Many factors could cause actual results, performance or achievements to differ materially from the results discussed or implied in the forward-looking statements such as the final acceptance from the TSX Venture Exchange may be delayed or may not be obtained and the use of proceeds may not be as anticipated. These factors should be considered carefully and readers should not place undue reliance on the forward-looking statements. Although the forward-looking statements contained in this news release are based upon what management believes to be reasonable assumptions, the Company cannot assure readers that actual results will be consistent with these forward-looking statements. The Company assumes no obligation to update or revise them to reflect new events or circumstances, except as required by law.