Sugarbud Announces Closing of Fully Subscribed $4.0 Million Public Offering of Secured Convertible Debenture Units and Provides Corporate Update
Summary
"We are very pleased with the result of our public offering of secured convertible debentures and warrants, and view the outcome as yet another strong vote of confidence in the combined leadership of our management team, a very disciplined and focused business model and most importantly our ability to deliver strong operational and financial results," stated Sugarbuds Chief Executive Officer, John Kondrosky. "Together with the recently announced Credit Facility with First Calgary, the successful conclusion of our public offering further strengthens our balance sheet and provides the Company with a strong foundation and the additional working capital necessary to continue to successfully execute against our primary growth objectives and priorities," concluded Mr. Kondrosky.Each Debenture Unit, including those sold pursuant to the Over-Allotment Option (as defined below), consists of: (i) one 12.0% secured convertible debenture (each, a "Convertible Debenture"); and (ii) 20,000 common share purchase warrants of the Company (the "Warrants"). The Broker Warrants are exercisable into Common Shares at a price $0.05 per Common Share at any time up to 36 months following the date of issuance.The Offering was made pursuant to a short-form prospectus filed in each of the provinces of Canada (except Qu\xe9bec), and otherwise by private placement exemption in those jurisdictions where the Offering can lawfully be made, including the United States. Any number of important factors could cause actual results to differ materially from those in the forward-looking statements including, but not limited to: establishing a trading market for the Convertible Debenture and Warrants; fluctuations in the market price of the Common Shares, Convertible Debentures, Secured Notes and Warrants; risks relating to the dilution of the Common Shares, Convertible Debentures and Warrants; risks and uncertainties relating to the actual use of the net proceeds of the Offering; changes in market conditions; stock price volatility; Sugarbud may not obtain the necessary regulatory approvals to list the Convertible Debentures, the Warrants and the Common Shares issuable upon conversion of the Convertible Debentures and the exercise of the Warrants and the Compensation Warrants on the TSXV; currently contemplated expansion and development plans may cease or otherwise change; production of cannabis may be lower than expected, Sugarbud may not obtain the required approvals from Health Canada, the size of the medical marijuana market and the recreational marijuana market; government regulations, including future legislative and regulatory developments involving medical and recreational marijuana; construction delays; risks inherent in the agricultural business, such as insects, plant diseases and similar agricultural risks which can have a significant impact on the size and quality of the harvest of cannabis crops; competition from other industry participants; and other factors more fully described from time to time in the reports and filings made by Sugarbud with securities regulatory authorities. While the precise impact of the COVID-19 virus on the Company remain unknown, rapid spread of the COVID-19 virus may have a material adverse effect on global economic activity, and can result in volatility and disruption to global supply chains, operations, mobility of people and the financial markets, which could affect interest rates, credit ratings, credit risk, inflation, business, financial conditions, results of operations and other factors relevant to the Company.