Aurora Cannabis Announces $40 Million Bought Deal Private Placement of Convertible Debentures
Apr 11, 2017, 07:43 ET
Cash Position to Exceed $150 Million
/NOT FOR DISSEMINATION IN THE UNITED STATES OR THROUGH U.S. NEWSWIRE SERVICES/
VANCOUVER, April 11, 2017 /CNW/ - Aurora Cannabis Inc. (the "Company" or "Aurora") (TSXV: ACB) (OTCQB: ACBFF) (Frankfurt: 21P; WKN: A1C4WM) announced today that it has entered into an agreement with Canaccord Genuity Corp., on behalf of a syndicate of underwriters (the "Underwriters"), pursuant to which the Underwriters have agreed to purchase, on a bought deal, private placement basis, subject to adjustment pursuant to the Underwriters' Option (as hereinafter defined), $40 million aggregate principal amount of convertible debentures (the "Convertible Debentures") at a price of $1,000 per Convertible Debenture (the "Offering").
Aurora has also granted the Underwriters an option (the "Underwriters' Option") to purchase up to an additional $20 million aggregate principal amount of convertible debentures on the same terms as the Convertible Debentures pursuant to the Offering (together with the Convertible Debentures, the "Debentures"). If the Underwriters' Option is exercised in full, the aggregate gross proceeds of the Offering will be $60 million.
Furthermore, and in connection with the Offering, certain holders have agreed to convert $17.5 million of outstanding convertible debentures, bearing interest at 8% per annum, into approximately 8,750,000 additional common shares.
The Debentures will bear interest from the date of closing at 7% per annum, payable semi-annually on June 30 and December 31 of each year. The Debentures will have a maturity date of 24 months from the Closing Date of the Offering (the "Maturity Date"). Net proceeds from the Offering will be used primarily towards international expansion and growth opportunities.
"This lower cost financing places Aurora in an extremely powerful position to aggressively pursue international expansion opportunities, with what we believe will be the strongest cash balance, at more than $150 million, in the global cannabis sector," said Terry Booth, CEO. "With our existing facility in Mountain View County, Alberta, construction proceeding rapidly on Aurora Sky at the Edmonton International Airport, and the recent acquisition of Peloton Pharmaceuticals in Quebec, we are also developing what we expect will be the largest cannabis production capacity in the world, grown to the Aurora Standard. Combined with our technological innovation, one-of-a-kind mobile application and e-commerce strategy, Aurora is ideally placed to play a leading role not only in the Canadian medical and consumer cannabis markets, but also in multiple emerging global cannabis markets."
The 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 $3.29 per Common Share (the "Conversion Price"). Beginning on the date that is four months and one day following the Closing Date, the Company may force the conversion of all of the principal amount of the then outstanding Debentures at the Conversion Price on 30 days prior written notice should the daily volume weighted average trading price of the Common Shares be greater than $4.94, for any 10 consecutive trading days.
The Debentures will be subject to redemption, in whole or in part, by the Company at any time after 12 months upon giving holders not less than 30 and not more than 60 days' prior written notice, at a price equal to the then outstanding principal amount of the Debentures plus all accrued and unpaid interest up to and including the redemption date. Upon a change of control of the Company, holders of the Debentures will have the right to require the Company to repurchase their Convertible Debentures, in whole or in part, on the date that is 30 days following the giving of notice of the change of control, at a price equal to 100% of the principal amount of the Debentures then outstanding plus accrued and unpaid interest thereon (the "Offer Price"). If 90% or more of the principal amount of the Debentures outstanding on the date of the notice of the change of control have been tendered for redemption, the Company will have the right to redeem all of the remaining Debentures at the Offer Price.
The Debentures and any Common Shares issuable upon conversion or exercise thereof, as applicable, will be subject to a statutory hold period lasting four months and one day following the closing date.
Closing of the Offering is expected to occur on or about April 26, 2017 (the "Closing Date"). The Offering 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.
Aurora's wholly-owned subsidiary, Aurora Cannabis Enterprises Inc., is a licensed producer of medical cannabis pursuant to Health Canada's Access to Cannabis for Medical Purposes Regulations (ACMPR). The Company operates a 55,200 square foot, state-of-the-art production facility in Mountain View County, Alberta, is currently constructing a second 800,000 square foot production facility, known as "Aurora Sky", at the Edmonton International Airport, and has acquired and is undertaking completion of a third 40,000 square foot production facility in Pointe Claire, Quebec, near Montreal. In addition, the company is the cornerstone investor with a 19.9% stake in Cann Group Limited, the first Australian company licensed to conduct research on and cultivate medical cannabis. Aurora's common shares trade on the TSX-V under the symbol "ACB".
On behalf of the Board of Directors,
AURORA CANNABIS INC.
This news release contains certain "forward-looking statements" within the meaning of such statements under applicable securities law. Forward-looking statements are frequently characterized by words such as "plan", "continue", "expect", "project", "intend", "believe", "anticipate", "estimate", "may", "will", "potential", "proposed" and other similar words, or statements that certain events or conditions "may" or "will" occur. These statements are only predictions. Various assumptions were used in drawing the conclusions or making the projections contained in the forward-looking statements throughout this news release. Forward-looking statements include, but are not limited to, the anticipated timing for closing of the Offering. Forward-looking statements are based on the opinions and estimates of management at the date the statements are made, and are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected in the forward-looking statements. The Company is under no obligation, and expressly disclaims any intention or obligation, to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as expressly required by applicable law.
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 Aurora Cannabis Inc.
For further information: Cam Battley, Executive Vice President, +1.905.864.5525, [email protected], www.auroramj.com; Marc Lakmaaker, NATIONAL Equicom, [email protected], +1.416.848.1397
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