On January 19, 2007, Lignol Energy Corporation (formerly Santa Cruz Ventures Inc.) ("Lignol Energy" or "the Company") announced that it had completed the acquisition of all the issued and outstanding common shares of Lignol Innovations Corporation ("Lignol"), a private company. The acquisition was effected by way of reverse-takeover transaction pursuant to an amalgamation agreement dated October 31, 2006 between the Company, a wholly-owned subsidiary of the Company and Lignol. The common shares of Lignol Energy will resume trading on the TSX Venture Exchange under the trading symbol "LEC", subject to the Company fulfilling the customary requirements of the Exchange.
Concurrent with the closing of the acquisition, Lignol Energy completed a private placement financing of 10 million units of the Company at a price of $0.50 per unit for aggregate gross proceeds to the Company of $5 million. Each unit is comprised of one common share and one-half common share purchase warrant of the Company, with each whole warrant being exercisable for one common share of the Company within two years of issue at a price of $0.75 per share.
The financing will fund the completion of Lignol's pre-commercial work plan and be used to acquire equity ownership in energy-related projects that have synergies with Lignol's biorefining technology and corporate mission. With the support of Sustainable Development Technology Canada (SDTC) and specific interested corporations, the pre-commercial work plan should deliver a technical design for a commercial biorefining plant capable of producing fuel grade ethanol and a variety of biochemical co-products from hardwood, softwood and a variety of agricultural residues.
A western Canadian company, Lignol's mission is to build biorefineries for the production of fuel-grade ethanol and biochemical co-products produced from cellulosic material sourced from Canadian forests and biomass. The technology facilitates the rapid, high-yield conversion of cellulose to ethanol. Plant economics are expected to be enhanced with revenues through value-added biochemical co-products. Lignol's unique technology has positioned it as one of the world's promising 'Cellulose to Ethanol' solutions.
Fasken Martineau advised Lignol Energy upon both the reverse take-over and the private placement with a team comprised of Blair Horn, Georald Ingborg, Benjamin Lee and Deepak Gill.