Feronia Inc. Announces Closing of First Tranche of Previously Announced US$17.5 Million Private Placement of Common Shares
TORONTO, ONTARIO--(Marketwired - Oct. 16, 2017) -
NOT FOR DISTRIBUTION IN THE UNITED STATES OR OVER UNITED STATES WIRE SERVICES
Feronia Inc. ("Feronia" or the "Company") (TSX VENTURE:FRN) is pleased to announce that it has closed the first US$9 million
tranche of the previously announced subscription by Straight KKM 2 Limited ("KKM") for US$17.5 million of common shares in the
capital of the Company ("Common Shares") at a price of Cdn.$0.18 per Common Share (the "Private Placement"). Based on a fixed
exchange rate of Cdn.$1.253 per US$1.00 as set out in the applicable subscription agreement, the Company has issued 62,650,000
Common Shares to KKM pursuant to this first tranche. The US$4 million bridge loan (the "Loan Facility") advanced to the Company
by two funds managed by the majority shareholder of KKM was applied towards the subscription amount for this first
tranche.
Further details regarding the Private Placement and the Loan Facility are described in the press release of the Company issued
on September 25, 2017. The Company anticipates that the closing of the US$8.5 million balance of the Subscription Amount will
occur in accordance with the terms of the Subscription Agreement.
As a result of closing this first tranche, KKM holds approximately 14.76% of the issued and outstanding Common Shares and thus
became an 'insider' of the Company. Pursuant to the rules of the TSXV, the Company obtained the written approval of its two
largest shareholders for the Private Placement. The Common Shares issued to KKM are subject to a four month statutory hold
period.
About Feronia Inc.
- Feronia is an agribusiness operating in the Democratic Republic of the Congo (DRC).
- At the heart of Feronia lies a long established palm oil business, Plantations et Huileries du Congo (PHC), which has
three remotely located plantations; Lokutu, Yaligimba and Boteka.
- When Feronia acquired its palm oil business from Unilever in 2009, it had suffered from years of underinvestment and
considerable disruption caused by conflict in the DRC. Our initial focus has been on rebuilding the business and resuming
production to secure its future and the livelihoods of our employees.
- Feronia's plantations produce crude palm oil (CPO) and palm kernel oil (PKO). CPO is part of the staple and traditional
diet of the Congolese and, with our products sold locally in the DRC, we are well placed to help decrease reliance on imports
and increase food security and quality.
- Feronia prides itself on being the guardian of our 106 year-old palm oil business and its employees, communities, and
environment. We have a long term commitment to improve the living and working environment of our employees and their
communities and are committed to sustainable agriculture, environmental protection and community inclusion. Feronia has in
place an Environmental and Social Action Plan which is focused on implementing environmental and social best practice and
improving social infrastructure.
- Feronia is working towards certification by the Roundtable for Sustainable Palm Oil (RSPO) and is implementing
IFC/World Bank standards for environmental and social sustainability. Our oil palm replanting programme is brownfield in nature
- replacing old palms with new - and it has no reliance on deforestation.
- Feronia's management team has extensive experience in managing both plantations and farming operations in emerging
markets.
- For more information please see www.feronia.com
Cautionary Notes
Except for statements of historical fact contained herein, the information in this press release constitutes "forward-looking
information" within the meaning of Canadian securities law. Such forward-looking information may be identified by words such as
"anticipates", "plans", "proposes", "estimates", "intends", "expects", "believes", "may" and "will". There can be no assurance
that such statements will prove to be accurate; actual results and future events could differ materially from such statements.
Factors that could cause actual results to differ materially include, among others: risks related to foreign operations
(including various political, economic and other risks and uncertainties), the interpretation and implementation of the "Loi
Portant Principes Fondamentaux Relatifs A L'Agriculture", termination or non-renewal of concession rights or expropriation of
property rights, political instability and bureaucracy, limited operating history, lack of profitability, lack of infrastructure
in the DRC, high inflation rates, limited availability of debt financing in the DRC, fluctuations in currency exchange rates,
competition from other businesses, reliance on various factors (including local labour, importation of machinery and other key
items and business relationships), the Company's reliance on one major customer, lower productivity at the Company's plantations,
risks related to the agricultural industry (including adverse weather conditions, shifting weather patterns, and crop failure due
to infestations), a shift in commodity trends and demands, vulnerability to fluctuations in the world market, the lack of
availability of qualified management personnel and stock market volatility. Details of the risk factors relating to Feronia and
its business are discussed under the heading "Risks and Uncertainties" in Feronia's Management's discussion and Analysis for the
year ended December 31, 2016, a copy of which is available on the Company's SEDAR profile at www.sedar.com. Most of these factors are outside the control of the Company. Investors are
cautioned not to put undue reliance on forward-looking information. Except as otherwise required by applicable securities
statutes or regulation, the Company expressly disclaims any intent or obligation to update publicly forward-looking information,
whether as a result of new information, future events or otherwise.
Neither 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.