Atlas Engineered Products Ltd. Announces Closing of $5.0 Million Bought Deal and $9.5 Million Concurrent Private Placement Offering

Atlas Engineered Products Ltd. (“AEP” or the “Company”) is pleased to announce the closing of its previously announced bought deal private placement of common shares (the “Offered Shares”) of the Company (the “Offering”) and concurrent brokered private placement of common shares (the “Private Placement Shares”) of the Company (the “Concurrent Private Placement”) for aggregate gross proceeds of $14,562,855.

The Company entered into an underwriting and agency agreement (the “Underwriting and Agency Agreement”) with Beacon Securities Limited (“Beacon”), as lead underwriter and sole bookrunner, together with Clarus Securities Inc., Cormark Securities Inc. and Ventum Financial Corp. (together with Beacon, the “Underwriters”), whereby the Company issued 3,704,000 Offered Shares at an issue price of $1.35 per Offered Share (the “Issue Price”) for gross proceeds of $5,000,400 pursuant to Part 5A (the “Listed Issuer Financing Exemption”) of National Instrument 45-106 – Prospectus Exemptions (“NI 45-106”), including 741,000 Offered Shares issued pursuant to the exercise in full of the option granted to the Underwriters pursuant to the Underwriting and Agency Agreement. Pursuant to the Concurrent Private Placement, the Company issued 7,083,300 Private Placement Shares at the Issue Price to certain purchasers pursuant to applicable exemptions under NI 45-106, for gross proceeds of $9,562,455.

The Company intends to use the net proceeds of the Offering and the Concurrent Private Placement for the purchase and installation of robotic automation equipment at facilities located in British Columbia, Ontario & New Brunswick, along with additional equipment and upgrades required to incorporate the robotics at these locations. The Company also intends to use the net proceeds of the Offering and the Concurrent Private Placement to pay for the initial costs of constructing a new building at its facility in Clinton, Ontario to house the robotics expansion at that location, to pay for potential new business acquisitions and for general working capital and corporate purposes.

In consideration for the services rendered by the Underwriters in connection with the Offering and Concurrent Private Placement, the Company has paid the Underwriters a cash commission of $720,090 and a corporate finance fee of $45,000.

The Private Placement Shares issued under the Concurrent Private Placement are subject to a four-month hold period in Canada. The Offered Shares issued under the Offering are not subject to a hold period pursuant to applicable Canadian securities laws as the Offering was completed pursuant to the Listed Issuer Financing Exemption. The Offering and Concurrent Private Placement remain subject to final approval of the TSX Venture Exchange (the “TSXV”).

The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the “U.S. Securities Act”), or the securities laws of any state of the “United States” (as such term is defined in Regulation S under the U.S. Securities Act), and may not be offered or sold in the United States unless registered under the U.S. Securities Act and the securities laws of any applicable state of the United States or an exemption from such registration requirements is available. This news release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any jurisdiction in which such offer, solicitation or sale would be unlawful.

Pursuant to Multilateral Instrument 61-101 Protection of Minority Security Holders in Special Transactions (“MI 61-101”), the Company advises that the Concurrent Private Placement constitutes a “related party transaction” under MI 61-101 due to the participation of certain insiders as subscribers under the Concurrent Private Placement. Insiders subscribed for 38,700 Private Placement Shares for aggregate proceeds of $52,245 pursuant to the Concurrent Private Placement. The Company is relying on the exemptions from the formal valuation and minority shareholder approval requirements of MI 61-101 pursuant to section 5.5(a) and section 5.7(1)(a) of MI 61-101 based on the fact that neither the fair market value of the Concurrent Private Placement nor the fair market value of the consideration paid pursuant to the Concurrent Private Placement, insofar as it involves related parties, exceeds 25% of the Company’s market capitalization.

About Atlas Engineered Products Ltd.

AEP is a growth company that is acquiring and operating profitable, well-established operations in Canada’s truss and engineered products industry. We have a well-defined and disciplined acquisition and operating growth strategy enabling us to scale aggressively and apply new technologies, giving us a unique opportunity to consolidate a fragmented industry of independent operators.

Contact:

Jake Bouma – Representative for AEP – (604) 317-3936 – jake.bouma@atlasaep.ca

Source: Atlas Engineered Products Ltd.