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Tetra's Officers and EES Participate in Private Placement

[Humanist]

Tetra's Officers and Employees Participate in Private Placement
07/30/2019
ORLEANS, Ontario, July 30, 2019 (GLOBE NEWSWIRE) -- Tetra Bio-Pharma Inc. (“Tetra” or the “Corporation”) is pleased to announce that, after successfully completing a prospectus offering for aggregate gross proceeds of $8,050,000 on July 12, 2019 (the “Unit Offering“), it now intends to complete a non-brokered private placement offering (the “Private Placement“), in which some of the Corporation’s directors, officers, consultants and employees, as well of certain of their associates, will purchase an aggregate of 870,000 units (“Unit“) of the Corporation at a price of $0.30 per Unit for aggregate gross proceeds of $261,000.

The Private Placement will be completed on the same terms as the Unit Offering and remains subject to approval by the TSX Venture Exchange (the “TSXV“). When aggregating the Unit Offering and the Private Placement, insiders, consultants and employees, including the Chief Executive Officer, Chief Financial Officer, the Chairman, directors and certain employees of the Corporation, will have purchased a total of 802,600 Units for aggregate gross proceeds of $240,780.
Guy Chamberland, Chief Executive Officer of Tetra, stated: “We are pleased to have extended the offering after certain members of our management team at site expressed a strong desire to participate in the private placement as well, which further highlights the strong commitment of the team towards the Company’s success.”
 
TERMS:
Each Unit to be issued in the Private Placement will consist of one common share of the Corporation (a “Common Share“) and one Common Share purchase warrant (a “Warrant“), with each Warrant entitling the holder thereof to purchase one Common Share at an exercise price of $0.40 per Common Share for a period of 36 months following the closing of the Private Placement.

The securities offered have not been, and will not be, registered under the U.S. Securities Act of 1933, as amended (the "U.S. Securities Act") or any U.S. state securities laws and may not be offered or sold in the United States absent registration or an available exemption from the registration requirement of the U.S. Securities Act and applicable U.S. state securities laws. This press release shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of these securities, in any jurisdiction in which such offer, solicitation or sale would be unlawful.

The Corporation intends to use net proceeds of the Private Placement to continue the development of its clinical trials and for working capital purposes as stated in its final short form prospectus filed on July 8, 2019.
Certain directors and senior officers of the Corporation or of its subsidiaries will subscribe for Units as part of the Private Placement. Their subscription as part of the Private Placement will constitute 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 of the TSXV.

Other than improving Tetra’s working capital position and increasing the number of Common Shares held by directors, officers and employees, the Private Placement is not expected to have any effect on Tetra’s business and affairs.
The Private Placement will be completed in reliance on

(i) an available exemption from the formal valuation requirement of MI 61-101 provided in paragraph (a) of Section 5.5 of MI 61-101 and

 (ii) an available exemption from the minority shareholder approval requirement of MI 61-101 provided in paragraph (a) of Section 5.7(1) of MI 61-101. Neither the fair market value of the Units to be issued nor the consideration to be paid for the Units pursuant to the portion of the Private Placement subscribed for by related parties of the Corporation will exceed 25% of the Corporation’s market capitalization.

As at the date of this news release, the “related parties” of Tetra own an aggregate of 6% of Tetra’s 211,969,411 issued and outstanding Common Shares (not including Common Shares issuable on the exercise of outstanding options).

Assuming the Private Placement is completed, the “related parties” will own an aggregate of 6% of the Corporation’s issued and outstanding Common Shares. Also, assuming the completion of the Private Placement, an aggregate of 398,900 Common Shares would be issued to “related parties” of the Corporation pursuant to the Private Placement which amounts to approximately 0.19% of the Corporation’s issued and outstanding Common Shares as of the date of this news release.

Assuming the exercise of the Warrants to be issued to “related parties” under the Private Placement, an aggregate of 398,900 additional Common Shares would be issued to “related parties” of the Corporation pursuant to the Private Placement which amounts to approximately 0.19% of the Corporation’s issued and outstanding Common Shares as of the date of this news release.

The Private Placement was approved by Tetra’s directors, provided that each disclosed an interest in the resolutions relating to the approval of the Private Placement in accordance with Section 120 of the Canada Business Corporations Act to the extent he is a participant in the Private Placement as a purchaser of Units and abstained from voting solely with respect to his purchase of Units but otherwise voted to approve the transaction. In approving the Private Placement, the Board of Directors took into account the following factors:

1. the fact that the Private Placement will be completed above market price with no discount, even though a discount would be permitted under TSXV rules;
2. Tetra’s need for working capital to fund on-going operations and strengthen its financial position; and

 
(iii) the participation in the Private Placement of management and employees who are an important part of Tetra’s business plan. The Board of Directors subsequently approved the Private Placement (subject to the disclosures of interest and abstentions noted above) and there was no contrary view by any director on the resolution approving the Private Placement.

The Private Placement will be completed pursuant to subscription agreements to be entered into between Tetra and each subscriber which contain standard representations and warranties as to eligibility to participate in the Private Placement under applicable Canadian securities laws and is expected to close on or about August 2, 2019. The completion of the Private Placement is subject to the approval of the TSXV.

The Corporation expects that it will not file a material change report more than 21 days before the expected closing of the Private Placement the Corporation wishes to close the Private Placement on an expedited basis for sound business reasons and in a timeframe consistent with usual market practices for transactions of this nature.

About Tetra Bio-Pharma:
Tetra Bio-Pharma Inc. (TSX-V: TBP) (OTCQB: TBPMF) a biopharmaceutical leader in cannabinoid-based drug discovery and development with a Health Canada approved and FDA reviewed clinical program aimed at bringing novel prescription drugs and treatments to patients and their healthcare providers. Tetra Bio-Pharma has subsidiaries engaged in the development of an advanced and growing pipeline of Bio Pharmaceuticals, Natural Health and Veterinary Products containing cannabis and other medicinal plant-based elements. With patients at the core of its mission, Tetra Bio-Pharma is focused on providing rigorous scientific validation and safety data required for inclusion into the existing bio pharma industry by regulators, physicians and insurance companies. For more information visit: www.tetrabiopharma.com More information at: www.tetrabiopharma.com Source: Tetra Bio-Pharma