Aurora Announces Terms and Increase of Brokered Private Placement to $18 Million
Jul 18, 2016, 08:00 ET
/NOT FOR DISSEMINATION IN THE UNITED STATES OR THROUGH U.S. NEWSWIRE SERVICES/
VANCOUVER, July 18, 2016 /CNW/ - Aurora Cannabis Inc. (the "Company" or "Aurora") (CSE: ACB) (OTCQB: ACBFF) (Frankfurt: 21P; WKN: A1C4WM) is pleased to announce, further to its news release dated June 8, 2016, the pricing terms, and an increase in the size of its best efforts private placement offering (the "Offering") of subscription receipts (the "Subscription Receipts"). Canaccord Genuity Corp. (the "Agent") is the lead manager and sole bookrunner for the Offering.
Aurora will offer to sell, on a private placement basis, 45,000,000 Subscription Receipts at a price of $0.40 per Subscription Receipt, for an aggregate of $18 million in gross proceeds. Upon satisfaction of certain escrow release conditions, each Subscription Receipt shall be automatically exchanged, without any further action by the holder of such Subscription Receipt (and for no additional consideration), for one common share in the capital of the Corporation (each, a "Common Share") and a half of one warrant, with each whole warrant (each, a "Warrant") exercisable at a price of $0.55 for one Common Share, subject to adjustment in certain events, for a period of two years.
The Company has granted the Agent an over-allotment option (the "Over-Allotment Option") to offer for sale an additional 12,500,000 Subscription Receipts for gross proceeds of $5 million on the same terms and conditions as the Offering. The Over-Allotment Option is exercisable in whole or in part up to 48 hours prior to the closing of the Offering. The closing of the offering is expected to take place on or about July 28, 2016.
Proceeds from the private placement are anticipated to be used to satisfy the cash component of the acquisition of CanvasRx Inc. (the "Acquisition"), and to fund a major expansion of Aurora's production capacity, with construction of a second large production facility in Alberta, Canada.
"This financing will provide Aurora with the capital to execute on core elements of our strategic plan, and I'm very pleased by the enthusiastic response to the private placement," said Terry Booth, CEO. "Since we commenced product sales in January 2016, we've established ourselves as a leading driver in the cannabis sector, with unprecedented rates of growth and patient registration. Our business strategy is to rapidly expand production capacity, continue to operationalize industry leading technology, and ensure absolute consistency of the Aurora Standard, in terms of our product quality and our customer care experience."
The Subscription Receipts will be issued pursuant to a subscription receipt agreement (the "Subscription Receipt Agreement") to be entered into among the Company, the Agent and a subscription receipt agent to be agreed upon. Pursuant to the Subscription Receipt Agreement, the gross proceeds from the Offering (less 1/2 of the Agents' cash commission and all of the Agents' expenses) (the "Escrowed Funds") will be held in escrow pending satisfaction of the escrow release conditions, including (i) the satisfaction of all conditions precedent to the completion of the Acquisition; (ii) Aurora shall have complied with all requirements under the policies of the Canadian Stock Exchange (the "CSE") in connection with the Offering, (iii) the receipt of all necessary shareholder, regulatory, third-party approvals, if any, with respect to the Acquisition, and (iv) Aurora shall not be in breach or default of any of its covenants or obligations under the Subscription Receipt Agreement or the agency agreement to be entered into with the Agent (the "Escrow Release Conditions"). Upon satisfaction of the Escrow Release Conditions, the Escrowed Funds, together with any interest earned thereon, will be released to the Company.
If the Escrow Release Conditions have not been satisfied by 5:00 p.m. (EST), on November 25, 2016, the Subscription Receipts will be deemed to be cancelled and holders of Subscription Receipts will receive a cash amount equal to the offering price of the Subscription Receipts and any interest that has been earned on the Escrowed Funds less any applicable withholding taxes.
The Offering is subject to certain conditions including receipt of all regulatory approvals and satisfaction of all conditions (other than payment of the closing date cash payment) for the completion of the Acquisition.
On behalf of the Board of Directors, AURORA CANNABIS INC.
Terry Booth, CEO
This news release contains statements that are forward-looking in nature and, as a result, are subject to certain risks and uncertainties. Forward-looking information in this press release includes statements regarding the timing and completion of the proposed Acquisition, the use of proceeds from the Offering, the satisfaction of the escrow release conditions, management's expectations with respect to the Offering and the Acquisition, and management's assessment of the Company's future plans and financial outlook. The words "may", "anticipate", "will" and similar words and expressions are used to identify forward-looking statement. Although the Company believes that the expectations reflected in these forward-looking statements are reasonable, undue reliance should not be placed on them as actual results may differ materially from the forward-looking statements. Such forward-looking statements are estimates reflecting the Company's best judgment based upon current information and involve a number of risks and uncertainties, and there can be no assurance that other factors will not affect the accuracy of such forward-looking statements. Such factors include but are not limited to the risks set out in the Company's management's discussion and analysis filed on SEDAR. The forward-looking statements contained in this news release are made as of the date hereof, and the Company undertakes no obligation to update publicly or revise any forward-looking statements or information, except as required by law.
The CSE or other regulatory authority has not reviewed, approved or disapproved the contents of this press release.
We seek Safe Harbour.
SOURCE Aurora Cannabis Inc.
For further information: Cam Battley, Senior VP Communications and Medical Affairs, +1.905.864.5525, [email protected], www.auroramj.com; Marc Lakmaaker, NATIONAL Equicom, [email protected], +1.416.848.1397
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