THIS NEWS RELEASE IS INTENDED FOR DISTRIBUTION IN CANADA ONLY AND IS NOT INTENDED FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR DISSEMINATION IN THE UNITED STATES.
TORONTO, Nov. 06, 2019 (GLOBE NEWSWIRE) -- North Bud Farms Inc. (CSE:NBUD) (NOBDF) ("NORTHBUD" or the "Company") today announces that the Company will hold its Annual General and Special Meeting at 1:00 p.m. on Monday, December 16, 2019 at the office of McMillan LLP World Exchange Plaza, Suite 2000, Ottawa, Ontario.
Additionally, the Company is pleased to announce that on November 6, 2019, the board authorized the issuance of up to 4,000 convertible debenture units (“Units”) of the Company at a price of $1,000 per Unit for total gross proceeds of up to $4,000,000. Based on this decision the Company will not be closing any additional tranches of the previously announced equity private placement.
Each Unit is comprised of one $1,000 principal amount of secured convertible debenture (a “Convertible Debenture”) accruing interest at 10.0% per annum, payable semi-annually in arrears until maturity, and 2,000 common share purchase warrants of the Company (each, a “Warrant”). The Convertible Debentures will have a maturity date of 36 months from the date of issuance.
Each Convertible Debenture shall be convertible into common shares in the capital of the Company (each, a “Conversion Share”) at a price of $0.30 per Conversion Share.
Each Warrant entitles the holder thereof to acquire one common share in the capital of the Company (each, a “Warrant Share”) for an exercise price of $0.25 per Warrant Share for a period of 18 months following the closing date.
The Convertible Debentures are direct secured obligations of the Company and rank pari passu in right of payment of principal and interest with all other Convertible Debentures issued under the Offering.
The Company is pleased to announce that on November 6, 2019 it closed an initial tranche of 1,264 Units for gross proceeds of $1,264,000. These Units were purchased by one insider and existing shareholders. The Company intends to close the remaining Units in one or more tranches over the coming weeks.
Ryan Brown, the Chief Executive Officer, of the Company participated in the private placement and beneficially acquired 664 Units for a total proceeds of $664,000. The purchase constitutes a “related party transaction” within the meaning of Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions (“MI 61-101”). The issuance is exempt from the formal valuation and minority shareholder approval requirements of MI 61-101 as the fair market value of the Units issued to or the consideration paid by such insider did not exceed 25% of the Company’s market capitalization.
Certain finders (the “Finders”) received a cash commission on the sale of the Offering of $48,000. The Finders also received 48,000 compensation warrants (the “Compensation Warrants”), each carrying the right to purchase 3.3333 common shares in the capital of the Company at a price of $1.00 per Compensation Warrant for a period of 18 months from the closing date.
The proceeds of the Offering will be used by the Company for expansion of the Company’s facilities and for general corporate and working capital purposes.
The Convertible Debentures, Warrants and Compensation Warrants issued pursuant to the Offering and any common shares in the capital of the Company issued on conversion of the Convertible Debentures or exercise of the Warrants or Compensation Warrants are subject to a statutory hold period in Canada of four months and one day following the closing date in accordance with applicable securities laws, which shall expire on March 7, 2020. Additional resale restrictions may be applicable under the laws of other jurisdictions, if any.
The securities of the Company have not been and will not be registered under the United States Securities Act of 1933, as amended (the “U.S. Securities Act”) or any state securities laws. Accordingly, the securities of the Company may not be offered or sold within the United States unless registered under the U.S. Securities Act and applicable state securities laws or pursuant to an exemption from the registration requirements of the U.S. Securities Act and applicable state securities laws. This news release does not constitute an offer to sell or a solicitation of an offer to buy any of the securities of the
Company in any jurisdiction in which such offer, solicitation or sale would be unlawful.
Since the submission of our evidence package to Health Canada, the Company has received some minor comments from the regulators all of which have been responded to within 24 hours. The Company will update shareholders with any material developments related to the application process.
About North Bud Farms Inc.
North Bud Farms Inc., through its wholly owned subsidiary GrowPros MMP Inc., is pursuing a licence under The Cannabis Act. The Company has built a state-of-the-art purpose-built cannabis production facility located on 135 acres of Agricultural Land in Low, Quebec, Canada. NORTHBUD through its wholly owned U.S. subsidiary, Bonfire Brands USA has entered into agreements to acquire assets in California and Nevada.
For more information visit: www.northbud.com
Neither the Canadian Securities Exchange (the “CSE”) nor its Regulation Services Provider (as that term is defined in the policies of the CSE) accepts responsibility for the adequacy or accuracy of this release.
Certain statements included in this press release constitute forward-looking information or statements (collectively, “forward-looking statements”), including those identified by the expressions “anticipate”, “believe”, “plan”, “estimate”, “expect”, “intend”, “may”, “should” and similar expressions to the extent they relate to the Company or its management. The forward-looking statements are not historical facts but reflect current expectations regarding future results or events. This press release contains forward- looking statements that include, but are not limited to, statements related to the intended use of proceeds from the Offering. These forward-looking statements are based on current expectations and various estimates, factors and assumptions and involve known and unknown risks, uncertainties and other factors. Such risks and uncertainties include, among others, the risk factors included in North Bud Farms Inc.’s final long form prospectus dated August 21, 2018, which is available under the issuer’s SEDAR profile at www.sedar.com.
FOR ADDITIONAL INFORMATION, PLEASE CONTACT:
North Bud Farms Inc.
VP, IR & Communications
Office: (855) 628-3420 ext. 3