MPX INTERNATIONAL ANNOUNCES NON-BROKERED PRIVATE PLACEMENT OF UNITS OF UP TO C$5 MILLION
MPX International Corp. intends to further operationalize some of its revenue-generating assets and is raising a minimum of $4.0-million and a maximum of $5.0-million in a non-brokered private placement offering of a minimum of 3,000 units and a maximum of 3,700 units at a price of $1,000 (U.S.) per unit.
"This fund raise will enable the final stage of development of our processing operations in Switzerland and the launch of a number of new CBD products into that market in the coming months, including oils, smokables and pouches and to advance other cannabis projects in Canada and globally. The revenue from these capital expenditures will have the potential to create a significant impact on our near-term revenue generation," said W. Scott Boyes, chairman, president and chief executive officer of MPX International. "At the same time, we have instigated cost saving measures across the corporate group in order to accelerate the path to sustainable long-term profitability."
Each unit consists of one 12 per cent secured convertible debenture of the corporation in the principal amount of $1,000 (U.S.) and 7,000 common share purchase warrants. The debentures will have a maturity date of 24 months from the date of issuance, subject to certain conversion privileges as set forth in a debenture indenture with AST Trust Company (Canada). Each debenture will rank pari passu in right of payment of principal and interest with all other debentures issued under the offering.
The corporation intends to use the proceeds from the offering to finance product and facility development in Switzerland and retail expansion in Canada as well as for working capital and other general corporate purposes.
The closing of the offering is subject to the receipt of any necessary regulatory approvals, including, to the extent necessary, the approval of the Canadian Securities Exchange and may occur in multiple tranches.
Each debenture shall bear interest at a rate of 12 per cent per annum from the date of issue, payable quarterly in arrears on the last day of March, June, September and December in each year, commencing Dec. 31, 2020. The amount of interest that becomes payable on Dec. 31, 2020, will represent accrued interest for the period from the initial closing date to Dec. 31, 2020. All accrued but unpaid interest as of each coupon date shall be payable by the corporation in cash and shall accrue interest at a rate of 12 per cent per annum.
The principal amount shall be convertible for no additional consideration into common shares of the corporation at the option of the holder at any time prior to the earlier of: (i) 6 p.m. Eastern Standard Time on the maturity date; or (ii) the business day immediately preceding the date specified by MPX International for redemption of the debentures at a conversion price equal to 12 cents per common share.
Each warrant entitles the holder thereof to purchase one common share at an exercise price of 20 cents for a period of 24 months from the closing date. The corporation and AST will enter into a warrant indenture pursuant to which the warrants will be created and issued.
It is a condition of the offering that the corporation execute and deliver a guarantee and certain security documents in favour of AST, as collateral agent, as security for the payment and performance of the corporation's obligations under the debenture indenture.
The corporation may pay a cash placement fee equal to 5 per cent of the aggregate gross proceeds paid by each purchaser of units that are invested in the offering, excluding the aggregate number of units purchased by investors that participated in the corporation's prior equity raise which closed in March, 2019.
In addition, the corporation may issue that number of common share purchase warrants equal to 5 per cent of the aggregate number of common shares underlying the debentures if converted as of the closing date and the warrants issued to purchasers of the units excluding the aggregate number units purchased by investors that participated in the corporation's equity raise that closed in March, 2019. The compensation warrants shall be exercisable at the exercise price for a period of two years from the applicable closing date of the offering.
The securities issued pursuant to the offering including any common shares and other underlying securities issued on conversion of the securities will be subject to a statutory hold period in Canada of four months and one day following the applicable closing date of the offering in accordance with applicable securities laws. Additional resale restriction may be applicable under the laws of other jurisdictions.
About MPX International Corp.
MPX International is a multinational diversified cannabis company focused on developing and operating assets across the global cannabis industry with an emphasis on cultivating, manufacturing and marketing products which include cannabinoids as their primary active ingredient.