They're dreaming if they think they can raise $ 5 million . Are there that many suckers left in the pot space .
2020-02-25 12:13 ET - News Release
Mr. Patrick Brauckmann reports
PASHA ANNOUNCES SHARE CONSOLIDATION, FINANCING AND RESTRUCTURING OF DEBT
Pasha Brands Ltd. plans to consolidate its common share capital on the basis of one postconsolidation share for every 12 preconsolidation shares. It is anticipated that the consolidation will reduce the outstanding capital of the company such that there will be approximately 16,216,612 common shares outstanding. The company believes that the consolidation will make the company more attractive to financing opportunities, and will allow for the restructuring and settlement of certain existing liabilities.
Financing
Following completion of the consolidation, the company intends to offer up to 6,944,444 postconsolidation units by way of a non-brokered private placement at a price of 72 cents per offering unit for gross proceeds of up to $5-million. Each offering unit will consist of one postconsolidation common share and one-half of one share purchase warrant, which will entitle the holder to acquire one additional postconsolidation common share at an exercise price of $1.02 for a period of 36 months following closing.
The company anticipates paying finders' fees to certain eligible parties who have assisted by introducing subscribers to the offering. All securities issued in connection with the offering will be subject to a four-month-and-one-day statutory hold period in accordance with applicable securities laws.
Debt settlement
The company has reached an agreement with certain arm's-length creditors to settle all outstanding obligations related to the acquisition of certain intellectual property associated with the trade name CBD Therapeutics. The obligations total $2.75-million and are being settled through the transfer of ownership of 1160988 B.C. Ltd., a wholly owned subsidiary of the company, which holds the assets related to CBD Therapeutics. In connection with the settlement, the company has also agreed to release a total of 17,510,072 preconsolidation common shares issued in connection with the original acquisition of 1160988 B.C. from the terms of a voluntary pooling arrangement, such that they will now become free trading.
Restructuring of convertible debentures
The company intends to seek approval from the holders of outstanding convertible debentures in the aggregate principal amount of $12,261,456 to convert the debentures into equity of the company. The company will seek approval of the holders to issue an aggregate of 12,021,035 units at a price of $1.02 per conversion unit in full and final settlement of all outstanding obligations due and owing in connection with the debentures. Each conversion unit will consist of one postconsolidation common share and one share purchase warrant, which will entitle the holder to acquire one additional postconsolidation common share of the company at an exercise price of $1.20 for a period of 36 months following the closing date.
Completion of the consolidation, the offering, the debt settlement and the restructuring of the debentures remains subject to completion of appropriate regulatory filings with the Canadian Securities Exchange.