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Sunshine Oilsands Ltd. is committed to providing our investors and the public with timely and accurate information regarding our business and operating activies.
October 11, 2019

ISSUE OF SHARES UNDER GENERAL MANDATE

Hong Kong (October 11, 2019) / Calgary, Alberta (October 11, 2019) - The Board of Directors (the “Board”) of Sunshine Oilsands Ltd. (the “Corporation” or “Sunshine”) (HKEX: 2012) wishes to announce the following:

ISSUE OF SHARES UNDER GENERAL MANDATE FOR SETTLEMENT OF TRADE CREDITOR

On Hong Kong (October 11, 2019) / Calgary, Alberta (October 11, 2019), the Corporation entered into the Settlement Agreement with the Trade Creditor, being an Independent Third Party and a trade creditor to the Corporation, pursuant to which the Corporation will allot and issue the Relevant Shares to the Trade Creditor as full and final settlement of the Partial Trade Payable.

 

The Issue Price is HK$0.063, which represents

(i) a discount of approximately 9.22% as to the average closing price of HK$0.0694 per Share as quoted on the Hong Kong Stock Exchange for the last five consecutive trading days immediately prior to and including October 10, 2019; and

(ii) a discount of approximately 10.00% to the closing price of HK$0.070 per Share as quoted on the Hong Kong Stock Exchange on October 11, 2019.

The Relevant Shares, which shall rank pari passu in all respect with the existing Shares, will be allotted and issued under the General Mandate. The Corporation will apply to the Listing Committee of the Stock Exchange for the listing of, and permission to deal in the Relevant Shares. Up to the date of this announcement, the Board has allotted and issued 158,590,480 Shares under the General Mandate. No shareholders’ approval is required for the allotment and issue of the Relevant Shares.

Shareholders and potential investors should note that completion of the Issuance is subject to fulfilment of the conditions under the Settlement Agreement. As the Issuance may or may not proceed, Shareholders and potential investors are reminded to exercise caution when dealing in the Shares.

ISSUANCE OF RELEVANT SHARES
Pursuant to the Settlement Agreement entered into between the Corporation and the Trade Creditor on Hong Kong (October 11, 2019) / Calgary, Alberta (October 11, 2019), the Corporation will allot and issue the Relevant Shares at the Issue Price to the Trade Creditor as full and final settlement of the Partial Trade Payable .

 

THE RELEVANT SHARES
Assuming no further issue of new Shares or repurchase of Shares (other than those failing to be issued upon full exercise of the share options), the Relevant Shares represent (i) approximately 0.60% of the existing issued share capital of the Corporation as at the date of this announcement; and (ii) approximately 0.59% of the total enlarged issued share capital of the Corporation immediately following completion of the Issuance.

ISSUE PRICE
The Issue Price is HK$0.063, which represents


(i) a discount of approximately 9.22% as to the average closing price of HK$0.0694 per Share as quoted on the Hong Kong Stock Exchange for the last five consecutive trading days immediately prior to and including October 10, 2019; and


(ii) a discount of approximately 10.00% to the closing price of HK$0.070 per Share as quoted on the Hong Kong Stock Exchange on October 11, 2019.
It was arrived after arm’s length negotiation between the Corporation and the Trade Creditor with reference to the market condition and the prevailing market price of the Shares.

GENERAL MANDATE TO ISSUE THE RELEVANT SHARES
The Relevant Shares will be allotted and issued pursuant to the General Mandate and the issue of the Relevant Shares is not subject to Shareholders’ approval. The maximum number of Shares that can be issued under the General Mandate is 1,227,169,324 Shares. Up to the date of this announcement, the Board has allotted and issued 158,590,480 Shares under the General Mandate. No shareholders’ approval is required for the allotment and issue of the Relevant Shares.

 

RANKING AND APPLICATION FOR LISTING
The Relevant Shares will be issued under the General Mandate and will rank pari passu in all respects among themselves and with the existing Shares in issue on the Completion Date. Application will be made to the Stock Exchange for the grant of the listing of, and permission to deal in the Relevant Shares.
CONDITIONS


Completion of the Settlement Agreement shall be subject to and conditional upon the following:

(i) the Listing Committee of the Stock Exchange granting the listing of, and permission to deal in the Relevant Shares; and


(ii) all relevant approvals and consents from governmental or other competent authority or in accordance with applicable laws having been obtained, if necessary.

 

None of the above conditions are capable of being waived. In the event that the conditions of the Issuance are not fulfilled on or before October 25, 2019 (or such other time and date as may be agreed between the parties to the Settlement Agreement), the Settlement Agreement shall cease and determine and neither the Corporation nor the Trade Creditor shall have any obligations and liabilities under the Settlement Agreement.


EFFECTS ON SHAREHOLDING STRUCTURE OF THE CORPORATION
As at the date of this announcement, the Corporation has 6,316,217,006 Shares in issue. The shareholding structure of the Corporation as at the date of this announcement and immediately after completion of the Issuance (assuming that there are no other changes to the shareholding structure of the Corporation from the date of this announcement to the date of completion of the Issuance) are as follows: