POND Pond Technologies Holdings Inc

MARKHAM, ON, March 12, 2025 /CNW/ - Pond Technologies Holdings Inc. ("Pond") (TSXV: POND) (OTCQB: PNDHF) (FSE:4O0), an ESG company addressing global sustainability challenges of wellness and climate change, today announced that its Board of Directors (the "Board") has initiated a strategic review process aimed at maximizing shareholder value. To support this initiative, the Chairman of the Board, Rob McLeese, has provided funding under the terms outlined below, and Pond has come to an agreement with certain executive officers and a consultant to Pond to have certain debt owing to them satisfied through the issuance of common shares of Pond ("Shares").

The strategic review process will involve a comprehensive assessment of Pond's current strategic direction, operational performance, market valuation, and capital structure. Pond will evaluate a range of potential alternatives, which may include, among other things, a corporate sale, a merger or other business combination, strategic investment, joint ventures, asset divestitures, continuation as a standalone public company or privatization.

Grant Smith, Chief Executive Officer of Pond, emphasized the importance of the strategic review, stating, "This process is a proactive step to explore all available opportunities that could enhance shareholder value. The Board and management team are fully aligned in ensuring that we conduct a rigorous and objective review of potential alternatives. Our priority remains to act in the best interest of our shareholders while continuing to execute our business strategy."

The Board has set a 90-day timeline to complete the process, though there is no assurance that it will result in any specific transaction or outcome. Pond remains fully committed to pursuing the most effective path forward, with a focus on delivering long-term value for shareholders. Pond will provide updates as appropriate when further developments arise.

Funding Details:

The funding arrangement provides for the following:

• Colmac Holdings Limited ("Colmac") (an entity controlled by Mr. Robert McLeese, who is Chairman of Pond, and which entity currently owns or exercises control or direction over 14,306,620 (approximately 18.3%) of the issued and outstanding Shares on a non-diluted basis) has provided a loan (the "Loan") in the aggregate amount of up to $815,000 in several tranches to Pond's wholly-owned subsidiary, Pond Technologies Inc., of which $615,000 has been advanced as of the date hereof.
  
  
• The Loan is unsecured, bears interest at 15% per annum, and matures on June 1, 2028.
  
  
• As consideration for agreeing to be on standby to advance the full aggregate principal amount of the Loan, Pond has agreed to issue to Colmac up to 20,000,000 Share purchase warrants of Pond ("Warrants"), to be issued proportionately to the amount advanced under the Loan, which vest on the date of issuance and are exercisable for Shares at an exercise price of $0.05 per Share, expiring on June 1, 2028, provided that if the Loan is repaid in whole or in part within one year of its term (and the Shares were listed on the TSX Venture Exchange ("TSXV") on the date of such payment), then the expiry date for that number of Warrants that are proportionate to the amount so repaid shall be reduced to the later of the date that is (a) one year from the issue date of the Warrants and (b) 30 days from such reduction or repayment of the Loan. 15,092,025 Warrants have been issued to Colmac as of the date hereof. The Warrants also provide that they cannot be exercised without prior Pond disinterested shareholder approval if such exercise would cause Colmac to acquire more than 20% of the Pond's issued and outstanding shares.
  
  
• In addition, on March 12, 2025 Pond awarded to Mr. McLeese 1,000,000 restricted share units ("RSUs") pursuant to Pond's existing omnibus incentive plan (the "Plan"). The RSUs vest on June 1, 2025, and will then be settled in Shares in accordance with the Plan.
  
  
• Proceeds of the Loan will be used for general working capital purposes and to fund the expenses associated with the strategic review process.
  
  
• The Loan and related issuance of the Warrants and RSUs are related party transactions for the purposes of TSXV Policy 5.9 and Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions ("MI 61-101") but are exempt from the valuation and majority of the minority shareholder approval requirements thereunder pursuant to the exemptions found in sections 5.5(b) (issuer not listed on specified markets) and 5.7(1)(e) (financial hardship) of MI 61-101, respectively.
  
  
• In considering the entering of the Loan arrangements, the Board, with Mr. McLeese abstaining, unanimously determined that the transaction is designed to improve the financial position of Pond and is reasonable in the circumstances.

The Loan remains subject to TSXV acceptance.

An aggregate of 7,500,000 Shares, issued at a price of $0.01 per Share, will be issued to satisfy an aggregate of $75,000 of consulting fees and employment salary owing to a consultant and certain executive officers of Pond. This arrangement enables Pond to preserve cash and reflects the continued commitment to Pond by its consultant and executive officers.

The issuance of the Shares remains subject to TSXV acceptance. The Shares issued in satisfaction of such debt are expected to be free-trading on the date of issuance.

Located in Markham, Ontario, Pond is a technology leader in controlled environment cultivation of microalgae. In over ten years of R&D, Pond has developed a robust disruptive technology platform based on artificial intelligence, proprietary LED-lights and patented CO2-Management. The use of concentrated CO2 from industrial waste streams enables Pond to boost productivity of microalgae well beyond the capacity of outdoor algae growers and allows industrial emitters to abate and ultimately recycle CO2. Pond is currently selling microalgae derived antioxidant astaxanthin under its Regenurex brand. As microalgae are becoming increasingly important in pharmaceuticals and cosmetics, nutraceuticals, human nutrition, aqua farming, bioplastics and biofuels, Pond has begun to license its technology to third parties for ongoing license fees and royalties. Pond recently added a Biotech division focused on the growth of unique strains of microalgae to be used as a reproductive medium for the expression of human anti-bodies and proteins.  

For more information, please visit https://www.pondtech.com/.

This news release contains forward–looking statements within the meaning of applicable securities laws, including statements regarding the use of proceeds of the Loan and related strategic review process and potential outcome thereof, and anticipated approval by the TSXV of the transactions described herein. Such forward–looking statements are based on certain key expectations and assumptions made by Pond, including, among others, the continued commercialization of Pond's technology, the successful negotiation of strategic alternatives, satisfaction of the requirements of the TSXV for its approval of the transactions described herein, continued successful negotiation of licensing, supply and commercial agreements on terms acceptable to Pond, the continued legislative regime in which Pond operates, availability of cost–effective labour and supplies, the proper functioning of Pond's technology, the quality of the algae produced, the demand for Pond's products, the ability of Pond to successfully compete, cash flow and expenses, and obtaining and maintaining intellectual property protection. Although Pond believes that the expectations and assumptions on which such forward–looking statements are based are reasonable, undue reliance should not be placed thereon and Pond can give no assurance that they will prove to be correct. By their nature, such forward–looking statements are subject to various risks and uncertainties, which could cause the actual results and expectations to differ materially from the anticipated results or expectations expressed, including the risks set forth in Pond's management's discussion and analysis of financial condition and results of operations for its year ended December 31, 2023, and for the interim period ended September 30, 2024, available on Pond's profile on the SEDAR+ website at www.sedarplus.ca

Readers are cautioned not to place undue reliance on this forward–looking information, which is given as of the date hereof, and to not use such forward–looking information for anything other than its intended purpose. Pond does not undertake any obligation to update publicly or revise any forward–looking information, whether as a result of new information, future events or otherwise, except as required by law.

Neither the TSXV nor its Regulation Services Provider (as that term is defined in the policies of the TSXV) accepts responsibility for the adequacy or accuracy of this release.

SOURCE Pond Technologies Holdings Inc.