All amounts expressed in Canadian dollars unless
otherwise noted
TORONTO and RIONEGRO,
Colombia, Dec. 22, 2021 /CNW/ - PharmaCielo Ltd.
("PharmaCielo" or the "Company") (TSXV: PCLO) (OTCQX: PCLOF), the
Canadian parent of Colombia's
premier cultivator and producer of medicinal-grade cannabis
extracts, PharmaCielo Colombia Holdings S.A.S. ("Holdings"), today
announced that it has plans to issue up to 15,000 debenture units
(each a "Unit") in a non-brokered private placement (the
"Offering"). The Units will be issued at a price of $1,000 per Unit for aggregate gross proceeds of
up to $15,000,000. Insiders,
including directors and management, plan to participate in the
Offering.
The Company expects to issue the Units on or about December 30, 2021, in one or more closings,
subject to the approval of the TSX Venture Exchange.
The Company intends to use the proceeds from the sale of the
Units for operations, working capital and the build-out of its
international psychoactive dry flower sales program.
Debenture Units
Each will Unit consist of $1,000
principal amount of 11% secured debentures ("Debentures") and 250
non-transferable common share purchase warrants ("Debenture
Warrants"). Each Debenture Warrant will entitle the holder for a
period of 36 months from the initial closing date to acquire one
common share of the Company (each a "Common Share") at an exercise
price equal to a 50% premium over the market price of the Common
Shares at the time of the initial closing. The Debentures will bear
interest at a rate of 11.0% per annum, will mature 36 months from
the date of initial closing date, and will be guaranteed by
Holdings. Holdings' guarantee of the Debentures will be secured by
mortgages on the real property of the Company and its
subsidiaries.
The Company will have the right to redeem any or all of the
Debentures from time to time at the following percentages of face
value: (i) 105% at any time prior to the first anniversary of the
initial closing date; (ii) 103% at any time on or after the first
anniversary of the initial closing date and prior to the second
anniversary of the initial closing date; and (iii) 101% thereafter,
in each case together with accrued and unpaid interest to, but not
including, the date of redemption.
Upon a change of control of the Company, holders will have the
right to have their Debentures repurchased at 105% of face value
plus accrued and unpaid interest to, but not including, the date of
repurchase.
The Debentures, Debenture Warrants and any Common Shares
issuable upon exercise of the Debenture Warrants will be subject to
a four-month hold period under applicable Canadian securities laws,
starting from the date of issuance of the corresponding
Units.
Management Commentary
Bill Petron, CEO of
PharmaCielo, commented, "We expect 2022 to be a very important
year for PharmaCielo, as Colombian dried flower exports begin, and
as global acceptance of and demand for imported cannabinoids
continues to grow. Since I assumed the CEO role in August, our team
has successfully streamlined the Company's overall cost structure
to align expenses with sales forecasts and re-focused the global
sales strategy towards high-margin products, leaving us ready to
execute. This Offering gives us the necessary capital to deliver on
current sales opportunities, while strategically building our
global sales organization to expand our pipeline."
Mr. Petron continued, "The fact that we were able to
obtain debt financing at a very reasonable cost, represents a
strong vote of confidence from investors and insiders regarding
both our team's progress to date as well as in PharmaCielo's growth
potential over the next twelve months. As a management team and
board of directors, we strongly believe in alignment with
shareholders. In addition to participating in the Offering, I
intend to purchase additional common shares of the Company on the
open market once the internal trading blackout has lifted, and I
know that several members of our senior team and board of directors
intend to do the same. We appreciate the support and continued
confidence of our shareholders and are committed to continuing to
advance our strategies during 2022, which we expect will result in
significant value creation."
About PharmaCielo
PharmaCielo Ltd. (TSXV: PCLO, OTCQX: PCLOF) is a global company,
headquartered in Canada, with a
focus on ethical and sustainable processing and supplying of all
natural, medicinal-grade cannabis oil extracts and related products
to large channel distributors. PharmaCielo's principal (and wholly
owned) subsidiary is PharmaCielo Colombia Holdings S.A.S.,
headquartered at its cultivation and processing center located in
Rionegro, Colombia.
The board of directors and executive team of PharmaCielo are
comprised of a diversely talented group of international business
executives and specialists with relevant and varied expertise.
PharmaCielo recognized the significant role that Colombia's ideal location plays in building a
sustainable business in the medical cannabis industry, and the
Company, together with its directors and executives, is executing
on a business plan focused on supplying the international
marketplace.
Forward-Looking Statements
This news release contains forward-looking statements.
Forward-looking statements can be identified by the use of words
such as "expects", "is expected", "intends", "anticipates",
"believes", or variations of such words and phrases or state that
certain actions, events or results "may" or "will" be taken, occur
or be completed or achieved. Forward-looking statements in this
news release include, without limitation, statements regarding the
issuance of the Units, including the terms thereof and the closing
date therefor.
The forward-looking statements in this news release are
necessarily based on assumptions, including assumptions with
respect to PharmaCielo's ability to obtain necessary approvals for
the issuance of the Units.
Forward-looking statements can be affected by known and
unknown risks, uncertainties and other factors, including changes
to PharmaCielo's development plans, the failure to obtain and
maintain all necessary regulatory approvals relating to the export
of cannabinoid products and the import of these products into other
countries, TSX Venture Exchange approval, the inability to export
or distribute commercial products through sales channels as
anticipated due to economic or operational circumstances, risks
associated with operating in Colombia, fluctuation of the market price for
the Company's products, risks associated with global economic
instability relating to COVID-19 or other developments, risks
related to retention of key Company personnel, currency exchange
risk, competition in PharmaCielo's market and other risks discussed
or referred to under the heading "Risk Factors" in PharmaCielo's
Annual Information Form for the financial year ended December 31, 2019, which is available at
www.sedar.com. Accordingly, readers should not place undue reliance
on forward-looking statements. Except as required by law,
PharmaCielo undertakes no obligation to publicly update any
forward-looking statements, whether as a result of new information,
future events or otherwise.
Neither the 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 press release.
SOURCE PharmaCielo Ltd.