/NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR
DISSEMINATION IN THE UNITED
STATES./
TORONTO, Oct. 30, 2017 /CNW/ - The Hydropothecary
Corporation ("THCX" or the "Company") (TSX VENTURE:THCX) announced
today that it has entered into a revised agreement with Canaccord
Genuity Corp. and a syndicate of underwriters (the "Underwriters")
pursuant to which the Underwriters have agreed to purchase, on a
bought deal basis, 60,000 convertible debenture units of the
Company (the "Convertible Debenture Units") at a price of
$1,000 per unit for aggregate gross
proceeds of $60,000,000. Each
Convertible Debenture Unit will consist of $1,000 principal amount of 7.0% senior unsecured
convertible debentures of the Company (the "Convertible
Debentures") and 227 common share purchase warrants (the
"Warrants") of the Company (the "Offering").
The Company has also granted the Underwriters an option to
purchase up to an additional 9,000 Convertible Debenture Units
under the Offering at a price of $1,000 per unit (the "Over-Allotment Option"). If
the Over-Allotment Option is exercised in full, the aggregate gross
proceeds of the Offering will be $69,000,000. The Over-Allotment Option are
exercisable at any time up to 30 days following the date of the
closing of the Offering.
The Convertible Debentures will bear interest from the date of
closing at 7.0% per annum, payable semi-annually on June 30 and December
31 of each year and will mature three years from the date
the Convertible Debenture Units are issued (the "Maturity Date").
The Convertible Debentures will be convertible at the option of the
holder into common shares of the Company ("Common Shares") at any
time prior to the close of business on the Maturity Date at a
conversion price of $2.20 per share
(the "Conversion Price"). The Company may force the conversion of
all of the principal amount of the then outstanding Convertible
Debentures at the Conversion Price on 30 days' written notice
should the daily volume weighted average trading price of the
Common Shares be greater than $3.15
for any 10 consecutive trading days.
At maturity, if the Company's market capitalization is equal to
or greater than $100,000,000, the
Company will have the right to pay up to 50% of the principal
amount of the then outstanding Convertible Debentures due in Common
Shares, which will be valued at the lower of: (i) the market price
of the Common Shares on the maturity date, and (ii) 95% of their
weighted average trading price on the principal exchange for
trading of the Common Shares at the maturity date for the 20
consecutive trading days ending five trading days preceding the
maturity date, and in each case only if such price is equal to or
greater than $1.00 and will be
subject to compliance with applicable policies of the principal
exchange for trading of the Common Shares at that time.
Each Warrant will be exercisable to acquire one common share of
the Company for a period of two years following the closing date of
the Offering at an exercise price of $3.00 per share, subject to adjustment in certain
events, and subject to the Company's right to accelerate expiry of
the Warrants if the closing trading price of the common shares of
the Company equals or exceeds $4.50
for any 10 consecutive trading days.
The Company intends to use the net proceeds of the Offering for
working capital and general corporate purposes.
The Convertible Debenture Units shall be offered and sold by way
of a bought deal public offering in all provinces and territories
of Canada, except Quebec, qualified by short form prospectus and
will not be offered or sold in the United
States or to, or for the account of, United States persons except to qualified
institutional investors (as defined in Rule 144A of the United
States Securities Act of 1933).
The Company will file a short form prospectus qualifying the
issuance of the Convertible Debenture Units in all the provinces
and territories of Canada, except
Quebec, pursuant to National
Instrument 44-101 – Short Form Prospectus Distributions. The
Offering is expected to close on or about November 17, 2017 and is subject to certain
conditions including, but not limited to, the receipt of all
necessary regulatory and stock exchange approvals, including the
approval of the TSX Venture Exchange.
About The Hydropothecary Corporation
The Hydropothecary Corporation is an authorized licensed
producer and distributor of medical cannabis licensed by Health
Canada under the Access to Cannabis for Medical Purposes
Regulations (Canada).
Hydropothecary provides sungrown and rigorously tested medical
cannabis of uncompromising quality. Hydropothecary's branding,
cannabis product offering, patient service standards and product
pricing are consistent with Hydropothecary's positioning as a
premium brand for a legal source for medical cannabis within this
new marketplace. In addition to medical cannabis production and
sales, Hydropothecary explores various research and development
opportunities for cannabinoid extracts, drugs and combinatory
chemistry. In addition, the company is investigating the
development and patenting of novel technologies related to medical
cannabis, as well as the import and export of medical cannabis.
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 release.
SOURCE The Hydropothecary Corporation