TORONTO, Sept. 26, 2017 /CNW/ - Cronos Group Inc. (TSX-V:
MJN) (OTC – Nasdaq International Designation: PRMCF) ("Cronos
Group" or the "Company") is pleased to announce the
closing of its non-brokered private placement of approximately
6,666,667 common shares at a price of CAD$2.25 per share, following an upsizing from
4,444,444 common shares after increased investor demand (the
"Offering"). The issuance by the Company for the Offering
results in total gross proceeds of approximately CAD$15,000,000. The net proceeds from the
Offering will primarily be used for working capital and general
corporate purposes and to fund the continued expansion of the
Company's production capacity.
"We are extremely fortunate to have investors that share our
vision and are focused on the long term. Our strategic
capital partners add intangible value that doesn't show up on the
balance sheet," said Mike
Gorenstein, CEO of Cronos.
William Hilson, Chief Financial
Officer of the Company and an insider as defined in Policy 1.1 of
the TSX‑V, subscribed for 17,567 common shares (the
"Insider Shares") in the Offering. Such subscription
constitutes a related party transaction within the meaning of
Multilateral Instrument 61-101 – Protection of Minority Security
Holders in Special Transactions ("MI 61-101") and Policy
5.9 – Protection of Minority Security Holders in Special
Transactions of the TSX-V (the "Related Party
Transaction"). In connection with the Related Party
Transaction, the Company is relying on the exemptions from the
formal valuation and minority approval requirements under MI
61-101. The Company is exempt from the formal valuation requirement
of MI 61-101 in reliance on section 5.5(b) of MI 61-101 as no
securities of the Company are listed or quoted on the Toronto Stock
Exchange, Aequitas NEO Exchange Inc., the New York Stock Exchange,
the American Stock Exchange, the NASDAQ Stock Market, or a stock
exchange outside of Canada.
Additionally, the Company is exempt from the minority shareholder
approval requirement under MI 61-101 in reliance on section
5.7(1)(a) of MI 61-101 as neither the fair market value of the
Insider Shares nor the fair market value of the consideration
therefor exceeds 25% of the Company's market capitalization.
Members of the Board of Directors of the Company unanimously
approved the issuance of the Insider Shares and the Related Party
Transaction. The Company did not file a material change report 21
days prior to its completion as the details of the participation of
insiders of the Company in the Offering had not been confirmed at
that time.
All securities issued in connection with the Offering are
subject to a regulatory hold period of four months and a day in
accordance with the rules and policies of the TSX Venture Exchange
and applicable Canadian securities laws, and such further
restrictions as may apply under foreign securities laws. Completion
of the financing is subject to final approval of the TSX Venture
Exchange.
About Cronos Group
Cronos Group is a geographically diversified and vertically
integrated cannabis company that operates two wholly-owned Licensed
Producers ("LPs") regulated within Health Canada's Access to
Cannabis for Medical Purposes Regulations (the "ACMPR") and holds a
portfolio of minority investments in other Licensed Producers. The
Company's flagship LPs, Peace Naturals Project Inc. (Ontario) and In The Zone Produce Ltd.
(British Columbia), are
collectively situated on over 125 acres of agricultural, licensed
land. Cronos Group is focused on building an international iconic
brand portfolio, providing patients with compassionate and
personalized care, and creating value for our shareholders.
Forward-looking statements
This news release may contain "forward-looking information" and
"forward-looking statements" within the meaning of applicable
Canadian securities legislation. All information contained herein
that is not clearly historical in nature may constitute
forward-looking information. Forward-looking statements are
necessarily based upon a number of estimates and assumptions that,
while considered reasonable by management, are inherently subject
to significant business, economic and competitive risks,
uncertainties and contingencies that may cause actual financial
results, performance or achievements to be materially different
from the estimated future results, performance or achievements
expressed or implied by those forward-looking statements and the
forward-looking statements are not guarantees of future
performance. Except as required by law, Cronos Group disclaims any
obligation to update or revise any forward-looking statements.
Readers are cautioned not to put undue reliance on these
forward-looking statements. This news release contains information
obtained by Cronos Group from third parties. Cronos Group believes
such information to be accurate but has not independently verified
such information.
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.
For more information, please visit
www.thecronosgroup.com.
SOURCE Cronos Group Inc.