VANCOUVER, March 10, 2020 /CNW/ - Rojo Resources Ltd.
("Rojo" or the "Company") (TSXV: RJ:H) is pleased to
announce that it has closed its previously announced private
placement of subscription receipts. The private placement was
over-subscribed and raised gross proceeds of $5,745,000 (the "Offering"). In
addition to proceeds raised by Rojo under the Offering, the target
company of Rojo's proposed reverse takeover Salvation Botanicals
Ltd. ("Salvation") has also completed a non-brokered private
placement of 1,020,000 units ("Units") for gross proceeds of
$255,000 (the "Sidecar"), for
aggregate gross Offering and Sidecar proceeds of $6,000,000.
Rojo issued 45,960,000 subscription receipts (the
"Subscription Receipts") at a price of $0.125 per Subscription Receipt ($0.25 per Subscription Receipt on a
post-consolidation basis, with reference to the Company's
previously announced 2:1 common share consolidation). The
gross proceeds from the Offering will be held in escrow by
Computershare Trust Company of Canada and will be released upon completion of
the escrow release conditions, which include completion of the
Company's acquisition by plan of arrangement of Salvation, which
includes Salvation's wholly-owned subsidiary, Numinus Wellness Inc.
("Numinus"). The entity resulting from the acquisition is
referred to as the "Resulting Issuer".
The Resulting Issuer aims to operate at the forefront of the
transformative change in treating the growing prevalence of mental
health issues and desire for greater overall wellness through
regulated alternative medicine therapies including the use of
cannabinoids and, subject to regulatory approval, psychedelic drug
treatments. The Resulting Issuer has an established and integrated
treatment and healing centre with the goal of creating a model to
scale globally.
The Resulting Issuer proposes to deploy the additional working
capital provided by the substantial oversubscription of the
Offering and Sidecar to:
|
(i)
|
upgrade its existing
integrated treatment and healing centre, as well as expand the
network of centres through acquisitions of existing
facilities;
|
|
(ii)
|
upgrade Salvation's
existing laboratory and processing facilities;
|
|
(iii)
|
finance the
completion of Salvation's cannabis sales license application
process with Health Canada;
|
|
(iv)
|
build a comprehensive
research and development facility to advance the growth and
sophistication of both Salvation and Numinus' offerings;
|
|
(v)
|
engage the growing
community of experts in psychedelic therapy protocol developments
to enhance and grow the scope of Numinus' services, and provide
additional training to Numinus' staff in respect of
same;
|
|
(vi)
|
to fund strategic
partnerships aimed at developing a model that uses research,
therapies and technology to advance public health and wellness;
and
|
|
(vii)
|
for general working
capital.
|
In connection with the plan of arrangement, pursuant to which
Rojo will acquire Salvation (including its wholly-owned subsidiary
Numinus), the Company will prepare and file a filing statement on
TSX Venture Exchange Form 3D2 (the "Filing Statement"). When
available under the Company's profile at www.sedar.com, investors
are encouraged to review the entirety of the Filing Statement for
greater detail in respect of the business of the Company, business
of Salvation, the proposed business of the Resulting Issuer and the
use of proceeds discussed above.
As a result of the 2:1 common share consolidation, each two
Subscription Receipts represents the right to automatically
receive, upon closing of the Company's proposed plan of
arrangement, one unit of the Resulting Issuer, each unit comprising
one common share and one-half of one share purchase warrant (the
"Warrants"). Each Warrant will entitle the holder to acquire
for a period of 2 years, one common share at a price of
50 cents per share, subject to
accelerated expiry. The Warrants contain an accelerator clause
whereby, if at any time after the date of issuance and prior to the
expiry of the Warrants the volume-weighted average trading price of
the common shares exceeds 75 cents
for a period of 10 consecutive trading days, the Resulting Issuer
is entitled, at its option, to accelerate the expiry date of the
Warrants by delivering written notice to the holders of Warrants,
to a date that is not less than 30 days following the delivery of
such written notice. The Salvation Units issued under the Sidecar
are each comprised of one common share of Salvation, and one
warrant of Salvation having the same terms as the Warrants. All
securities of Salvation issued in the Sidecar will be included in
the previously announced acquisition of Salvation by Rojo on a 1:1
basis.
The Company has agreed to pay certain finder's fees in
connection with the Offering. The finder's fees are not payable
until the escrow release conditions are met, being the closing of
the Company's acquisition of Salvation.
ON BEHALF OF THE BOARD
Rojo Resources Ltd.
Allen Morishita
President and Chief Executive Officer
For further information contact:
Michael Tan
Chief Operating Officer at Salvation/Numinus
1-855-420-8617
About Salvation
Since 2016, Salvation Botanicals Ltd. has been committed to
helping customers create safe and reliable products through
analytical services and full-spectrum testing. Based in
Nanaimo, B.C. Salvation operates
out of a state-of–the-art 7,000 sq foot facility that is one of the
largest labs in Western Canada.
Salvation deploys acclaimed scientists and lab technicians devoted
to research and building intellectual capital in the cannabis and
psychedelics sectors to advance intelligence in the alternative
medicine field for the treatment of many illnesses and for general
wellness. For more information regarding Salvation go to:
www.salvationbioscience.ca. Through its subsidiary Numinus Wellness
Inc., Salvation intends to provide alternative medicinal services
and tested products at its healing centre. For more information
about Numinus go to:
www.numinus.ca.
Statements in this press release regarding Rojo which are not
historical facts are "forward-looking statements" that involve
risks and uncertainties, such as the acquisition of Salvation (the
"Transaction"). Such information can generally be identified
by the use of forwarding-looking wording such as "may", "expect",
"estimate", "anticipate", "intend", "believe" and "continue" or the
negative thereof or similar variations. Since forward-looking
statements address future events and conditions, by their very
nature, they involve inherent risks and uncertainties such as the
risk that the closing may not occur for any reason.
Statements made in this press release regarding Salvation and
Numinus are based on information provided to Rojo by Salvation and
Numinus management.
Actual results in each case could differ materially from
those currently anticipated in such statements due to factors such
as: (i) the decision to not close the Transaction for any reason,
including adverse due diligence results and TSX Venture Exchange
refusal of the Transaction; (ii) adverse market conditions; (iii)
the need for additional financing; and (iv) change in laws and
regulations regarding the industry in which Salvation
operates. Except as required by law, the Company does not
intend to update any changes to such statements.
Completion of the Transaction is subject to a number of
conditions, including but not limited to, Exchange acceptance.
There can be no assurance that the Transaction will be completed as
proposed or at all.
Investors are cautioned that, except as disclosed in the
filing statement to be prepared in connection with the Transaction,
any information released or received with respect to the
Transaction may not be accurate or complete and should not be
relied upon. Trading in the securities of Rojo should be considered
highly speculative.
The TSX Venture Exchange has in no way passed upon the merits
of the proposed Transaction and has neither approved nor
disapproved the contents of this press release.
Neither TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release.
SOURCE Rojo Resources Ltd.
