Ayurcann Holdings Corp. (CSE:AYUR) said it has closed a non-brokered private placement of 7,710,354 units at a price of $0.18 each for aggregate gross proceeds of $1,387,863.72.
The company said it intends to use the net proceeds of the private placement for general working capital for business, corporate, research and development.
Each unit consists of one common share in the corporation and one common share purchase warrant. Each warrant entitles the holder thereof to purchase one Ayurcann common share at an exercise price of $0.22 for a period of the earlier of thirty-six months from the date of the closing of the private placement.
If, at any time after the closing, the closing price of Ayurcann common shares on the Canadian Securities Exchange (CSE) is at least $0.70 for a minimum of ten consecutive trading days, the company may, upon providing written notice to the warrant holders, accelerate the expiry date of the warrants to the date that is at least thirty days following the date of such written notice.
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All securities issued in connection with the private placement will be subject to a four-month and one-day hold period under applicable securities laws.
In connection with the private placement, eligible finders received $17,747.28 in cash and 98,594 broker warrants. Each broker warrant entitles the holder thereof to purchase one Ayurcann common share at an exercise price of $0.22 for a period of thirty-six months from the closing, subject to the acceleration provision.
The company also announced the granting of an aggregate of 1,253,125 restricted share units (RSU) to certain directors, officers, employees and consultants of the corporation, under its RSU plan. All RSUs granted vest immediately and the common shares issuable upon redemption will be subject to a four-month and one-day hold period under applicable securities laws.
Trading Services Agreement
Ayurcann also said it has entered into a non-exclusive issuer trading services agreement with Generation IACP Inc. (GIACP) for the purpose of providing trading services and contributing to the market liquidity of the company's common shares currently listed on the CSE. GIACP has agreed to comply with all applicable securities laws and policies of the CSE in providing the services.
Under the trading agreement, GIACP will provide the services for an initial term of six months at a monthly fee of C$7,500, plus applicable taxes. The initial term shall be automatically renewed for subsequent six month periods unless terminated. Ayurcann and GIACP act at arm's length from one another, and to the best knowledge of the company, GIACP has no present interest, directly or indirectly, in the securities of Ayurcann.
The company also corrected certain disclosures made in its news release issued on September 14, 2021, with regards to the engagement of three marketing firms which stated that none of the firms engaged had a direct or indirect interest in the securities of Ayurcann, or any right or intent to acquire such an interest. Discrete Media Inc. o/a 'Unlimited', one of the firms engaged, held common shares, which represented 0.53% of Ayurcann's issued and outstanding shares as of the date the press release was issued.
Ayurcann is a leading post-harvest solution provider with a focus on providing and creating custom processes and pharma-grade products for the adult use and medical cannabis industry in Canada.
The company is focused on becoming the partner of choice for leading Canadian cannabis brands by providing best-in-class, proprietary services including ethanol extraction, formulation, product development and custom manufacturing.
Contact the author at jon.hopkins@proactiveinvestors.com