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Organigram Holdings Inc. (TSX VENTURE:OGI) (OTCQB:OGRMF), a leading licensed producer of medical marijuana based in Moncton, New Brunswick, is pleased to announce that it has closed its previously announced short form prospectus offering, on a bought deal basis, including the full exercise of the over-allotment option. As such, a total of 16,428,572 Units of the Company were sold at a price of $3.50 per Unit, for aggregate gross proceeds of $57,500,002 (the “Offering“). The Offering was completed by a syndicate of underwriters led by Eight Capital, and including Canaccord Genuity Corp., GMP Securities L.P., Mackie Research Capital Corporation and PI Financial Corp.
Each Unit consisted of one common share of the Company and one-half of one common share purchase warrant (each whole common share purchase warrant, a “Warrant“). Each Warrant entitles the holder thereof to acquire one Share at a price of $4.00 until June 18, 2019.
The Company intends to use approximately 80% of the net proceeds of the Offering to commence and carry out part of the construction of an additional 255,000 of production space at its Moncton campus. The Expansion costs are expected to be funded by the proceeds of the Offering, debt financing and expected positive cash flow from operations. The remaining proceeds from the Offering are anticipated to be applied towards general working capital purposes and strategic international opportunity development.
The Units were offered and sold by way of a short form prospectus filed in each of the provinces of Canada, excluding Quebec, and offered and sold in the United States to certain purchasers, who are, or are purchasing for the account or benefit of, one or more U.S. persons or persons in the United States, each of whom qualifies as a “qualified institutional buyer” as defined in Rule 144A under the United States Securities Act of 1933, as amended.
The securities referred to in this news release have not been, nor will they be, registered under the United States Securities Act of 1933, as amended (the “1933 Act“), and may not be offered or sold within the United States or to, or for the account or benefit of, U.S. persons absent U.S. registration or an applicable exemption from the U.S. registration requirements.
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