MONCTON, NB, Oct. 2, 2018 /CNW/ - Organigram Holdings Inc.
(TSX VENTURE: OGI) (OTCQX: OGRMF), the parent company of Organigram
Inc. (the "Company" or "Organigram"), a leading licensed producer
of medical marijuana, is pleased to announce that is has closed the
previously-announced private placement investment in Eviana Health
Corporation ("Eviana" or the "Issuer").
Organigram along with an institutional strategic investor each
participated 50% in a $10 million
debenture offering (the "Debenture Offering") by Eviana.
"Our investment in Eviana represents just the beginning of our
international aspirations" said Greg
Engel, CEO of Organigram, "but is representative of our
approach to work with trusted local partners to both move quickly
with boots on the ground and to navigate regional regulatory issues
effectively".
"In Organigram we have a strategic ally that will join us as we
continue to capitalize on the international CBD market into the
future. We have also strengthened our balance sheet as we scale up
our production operation and fund our ambitious future growth plans
in the international CBD market," stated Avram Adizes, Chief Executive Officer of the
Eviana.
Board Representation
In connection with the closing of the Debenture Offering,
Organigram has been granted board representation rights, pursuant
to which Eviana has agreed to include one Organigram designated
candidate for election to the board of directors of the Issuer and
include this candidate in the slate of nominees recommended to
shareholders at any annual or special meeting of the shareholders
at which directors are to be elected. This board seat shall
be occupied by Mr. Paolo De Luca,
Chief Financial Officer of Organigram.
Offtake Sales Agreement
Organigram shall have the right, but not the obligation, to
purchase up to and including 25% (the "Offtake Percentage") of the
Issuer's (on a consolidated basis) annual CBD oil (or a comparable
form including, but not limited to, CBD crystals) at 95% of the
agreed raw CBD oil (or equivalent thereof) wholesale market price
for a period of 5 years from the date on which the CBD oil (or
equivalent thereof) is first made commercially available by Eviana
for wholesale (subject to final agreement on terms between
management of both companies).
Terms of the Debenture Offering
In connection with completion of the Debenture Offering, the
Eviana issued 10,000 debenture units (the "Debenture Units") of the
Issuer, maturing 24 months from the closing date, each consisting
of (i) $1,000 principal amount of
senior unsecured convertible debentures of the Eviana (the
"Debenture"); and (ii) one half of one common share ("Common
Shares") purchase warrant of the Issuer (each whole such purchase
warrant, a "Warrant"). Each full Warrant shall be exercisable by
the holder thereof for 870 Common Shares in the capital of the
Issuer (the "Warrant Shares") at an exercise price per Warrant
Share of $1.30 for a period of 24
months from the closing date of the Debenture Offering. The
Debentures are convertible into that number of fully paid and
non-assessable Common Shares of the Issuer computed on the basis of
the principal amount of the Debentures being converted, divided by
the conversion price of $1.15 per
Common Share at the holder's option, or upon mandatory conversion
at the request of the Issuer in the event that at any time after
four months plus one day following the closing date, the daily
volume weighted average closing price of the Common Shares on the
Canadian Securities Exchange ("CSE") is greater than $2.15 for any ten consecutive trading days.
The Debentures bear interest at a rate of 10.0% per annum from
the date of issue, payable semi-annually in arrears on June 30 and December
31 of each year, commencing December
31, 2018. Interest shall be computed on the basis of a
360-day year composed of twelve 30-day months. The December 31, 2018, interest payment will
represent accrued interest for the period from the closing date to
December 31, 2018. Upon conversion of
the Debentures, the holder shall also receive a cash payment amount
equal to the accrued and unpaid interest on the principal amount
being converted up to, but excluding, the applicable date of
conversion, as well as a cash payment equal to the additional
interest amount that such holder would have received if it had held
the Debentures for a period of one year from the date of
conversion, provided such period does not extend beyond the
maturity date.
About Organigram Holdings Inc.
Organigram Holdings Inc. is a TSX Venture Exchange listed
company whose wholly owned subsidiary, Organigram Inc., is a
licensed producer of cannabis and cannabis-derived products in
Canada.
Organigram is focused on producing the highest-quality,
indoor-grown cannabis for patients and adult recreational consumers
in Canada, as well as developing
international business partnerships to extend the Company's global
footprint. In anticipation of the legal adult use recreational
cannabis market in Canada,
Organigram has developed a portfolio of brands including The Edison
Cannabis Company, Ankr Organics, Trailblazer and Trailer Park Buds.
Organigram's primary facility is located in Moncton, New Brunswick and the Company is
regulated by the Access to Cannabis for Medical Purposes
Regulations ("ACMPR").
Neither TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in policies of the TSX Venture
Exchange) accepts responsibility for the adequacy or accuracy of
this release.
This news release contains forward-looking information which
involves known and unknown risks, uncertainties and other factors
that may cause actual events to differ materially from current
expectations. Important factors - including the interpretation of
the Cannabis Act and promotional activities, the availability of
funds, the results of financing efforts, crop yields - that could
cause actual results to differ materially from the Company's
expectations are disclosed in the Company's documents filed from
time to time on SEDAR (see www.sedar.com). Readers are
cautioned not to place undue reliance on these forward-looking
statements, which speak only as of the date of this press release.
The Company disclaims any intention or obligation, except to the
extent required by law, to update or revise any forward-looking
statements, whether as a result of new information, future events
or otherwise.
SOURCE OrganiGram