Halo Labs increases promissory note to $15-million
2020-08-26 19:09 ET - News Release
An anonymous director reports
HALO ENTERS INTO SECOND AMENDED AND RESTATED CONVERTIBLE PROMISSORY NOTE FOR AGGREGATE PRINCIPAL AMOUNT OF UP TO C$15 MILLION AND CLARIFIES PREVIOUS DISCLOSURE
Halo Labs Inc. has entered into a second amended and restated promissory note for a principal amount of up to $15-million.
The Second A&R Promissory Note amends and restates the amended and restated promissory note (the "Original A&R Promissory Note") that the Company entered into with a private arm's-length lender, as previously disclosed in the Company's press release dated June 9, 2020.
The Second A&R Promissory Note increases the committed funds available to the Company from C$10 million to C$15 million. To date, the Company has drawn down an aggregate of C$1 million of this committed amount. The Second A&R Promissory Note also contains an additional commitment fee of $35,000, to be satisfied through the issuance of 291,666 common shares in the capital of the Company ("Common Shares"). All of the other terms and conditions contained in the Original A&R Promissory Note remain unchanged.
A copy of the Second A&R Promissory Note will be filed under the Company's profile on SEDAR at www.sedar.com.
Clarification Regarding Certain Previous Disclosure
In connection with a regulatory review by Staff of the Ontario Securities Commission, the Company wishes to clarify previous disclosure included in the Company's press release dated July 6, 2020 (the "Previous Disclosure") with respect to the Company's acquisition of a majority interest in LKJ11 LLC ("LKJ11") and all of the issued and outstanding membership interests of Crimson & Black LLC ("Crimson & Black"). In the Previous Disclosure, the Company noted that: (i) the consideration paid for the majority interest in LKJ11 consisted of 42,881,646 Common Shares at a deemed price of USD$0.2332 per Common Share, representing a deemed value of approximately USD$10 million; and (ii) the consideration paid for all of the issued and outstanding membership interests of Crimson & Black consisted of 6,432,247 Common Shares at a deemed price of USD$0.2332 per Common Share, representing a deemed value of approximately USD$1.5 million. While the Company used deemed value to indicate the amount agreed upon between the parties at the time of the announcement of the transactions, as the consideration was payable in Common Shares, International Financial Reporting Standards require the use of fair value at the time of closing as this represents the actual value paid by the Company in connection with the acquisitions. In addition, the value of the acquisitions will be reported on the Company's financial statements at fair value at the time of closing. Based on the closing price of the Common Shares on the Neo Exchange Inc. on July 6, 2020, the date of closing, being $0.12 (USD$0.0886), the fair value of the Company's acquisition of a controlling interest in LKJ11 was approximately $5.15 million (USD$3.8 million) and the fair value of the Company's acquisition of all of the issued and outstanding membership interests in Crimson & Black was approximately $0.77 million (USD$0.57 million). For additional information, the Company relied on the exemption contained in Section 2.11 of National Instrument 45-106 -- Prospectus Exemptions to issue the Common Shares.
Annual General Meeting
Shareholders are reminded that the Company will be holding its annual general and special meeting (the "AGM") in virtual online format only on Wednesday, October 21, 2020. Meeting materials are expected to be delivered and filed which will provide details on how to attend and vote at the AGM. The Company is relying on the exemption in Ontario Instrument 51-504 - Temporary Exemptions from Certain Requirements to File or Send Securityholder Materials and equivalent blanket orders granted in other jurisdictions where the Company is a reporting issuer for the delay in complying with the annual request form requirement, the executive compensation disclosure requirement and the send-on-request requirements (as those terms are defined in the blanket orders), which will be complied with when the meeting materials for the AGM are delivered and filed.
About Halo
Halo is a leading cannabis cultivation, manufacturing, and distribution company that grows and extracts and processes quality cannabis flower, oils, and concentrates and has sold over 5 million grams of oils and concentrates since inception. Additionally, Halo has continued to evolve its business through delivering value with its products and now via verticalization in key markets in the United States and Africa with planned expansion into European and Canadian markets. With a consumer-centric focus, Halo markets innovative, branded, and private label products across multiple product categories.
Recently, the Company entered into a binding agreement to acquire Canmart Limited which holds wholesale distribution and special licenses allowing the import and distribution of cannabis based products for medicinal use (CBPM's) in the United Kingdom. Halo is led by a strong, diverse management team with deep industry knowledge and blue-chip experience. The Company is currently operating in the United States in California, Oregon, and Nevada while having an international presence in Lesotho within a planned 205-hectare cultivation zone via Bophelo Bioscience & Wellness (PTY) Ltd. as well as planned importation and distribution in the United Kingdom via Canmart Limited.
We seek Safe Harbor.
© 2020 Canjex Publishing Ltd. All rights reserved. |