VANCOUVER, BC / ACCESSWIRE / January 11, 2021 / Experion Holdings Ltd. (the 'Company' or 'Experion') (TSXV:EXP)(OTCQB:EXPFF)(FRANKFURT:MB31) has executed a commitment letter (the 'Commitment Letter') for a loan of up to $2,500,00 (the 'Loan') with a Canadian based mortgage lender (the 'Lender'). The Loan will support ongoing acceleration and growth of Experion's business.
'Experion continues to deliver on its growth objectives and has had tremendous success over the past 4 quarters as the Company's ‘aggregation and distribution' model for high quality, premium cannabis products have begun to deliver the return on investment we anticipated earlier in the year', said Jarrett Malnarich, CEO of Experion. 'The underpinning of this success continues to be the building of awareness and distribution of our premium cannabis brand, Citizen Stash, across Canada. We continue to cultivate our premium Citizen Stash flower at our B.C. based facility, but to fully realize on our growth plans, the Company also works with strategic cultivation partners to grow the Citizen Stash strains to our specifications, on our behalf. The Loan will support our working capital requirements to accelerate and increase strategic flower purchases from our cultivation partners to meet the growing market demand for our branded products. This injection of funds will allow us to ramp-up sales, ultimately driving both revenue and profit for the benefit of our business and by extension, our shareholders.'
Use of Proceeds
The Company will use the proceeds of the Loan to purchase premium flower feedstock from cultivation partners and other Canadian licensed producers to drive production and distribution growth of its Citizen Stash products. In addition, the proceeds will be used to purchase minor processing equipment to increase operating capabilities and drive cost efficiencies within the business.
The Loan will be advanced up to a maximum of $2,500,000 and have a 19-month term, with an option to extend for an additional 6-months, subject to Lender approval. The Loan will be secured with a conventional first mortgage on the land and building of the Company's Mission based operating facility. The Loan will bear interest at a rate of 11% per annum for the first 18 months and 14% per annum for the 19th month and beyond if the Loan is extended, pursuant to the 6-month extension option. The interest will be paid monthly, with principal due at maturity at the end of 19 months, subject to the extension option. The Loan can be repaid at any time but is subject to a minimum payment of 9-month's interest on the amount outstanding at the time of repayment. The Loan will be advanced in two tranches with the first advance being $1,565,000. The Company will have an option to draw the second advance of $935,000 anytime within 9-months of the initial funding date of the first advance.
The closing and funding of the Loan is subject to the execution of all security documentation and satisfaction of the conditions set forth in the Commitment Letter including, but not limited to, the approval of the TSX Venture Exchange. Subject to these conditions, it is expected that the Loan will be advanced sometime in January 2021.
Grant of Warrants
Pursuant to the Commitment Letter, Experion will issue 1,000,000 warrants to the Lender at a strike price of $0.18 for 24 months. The warrants will be issued at the time of closing of the Loan. The issue of the warrants by Experion is conditional upon such issuance being exempt from the prospectus requirements under applicable securities legislation and the receipt of all necessary regulatory approvals, including the acceptance of the TSX Venture Exchange.
About Experion Holdings Ltd.
Experion Holdings Ltd. is the parent company of Experion Biotechnologies Inc., a Health Canada licensed cultivator and processor of Cannabis, based in Mission, BC.
Experion Holdings Ltd. is invested in a portfolio of products to address a wide spectrum of consumer needs' including Adult-use, Wellness and Therapeutic, and Medical products.
Experion trades on the TSX Venture Exchange as a Tier 1 issuer under the symbol 'EXP' on the OTCQB Venture under the symbol 'EXPFF' and on the Frankfurt Stock Exchange under the symbol 'MB31'.
This news release contains 'forward-looking statements' and 'forward-looking information' (collectively referred to herein as 'forward-looking statements') within the meaning of applicable securities legislation. Such forward-looking statements include, without limitation, forecasts, estimates, expectations and objectives for future operations that are subject to a number of material factors, assumptions, risks and uncertainties, many of which are beyond the control of the Company.
Forward-looking statements are statements that are not historical facts and are generally, but not always, identified by the words 'expects', 'plans', 'anticipates', 'believes', 'intends', 'estimates', 'continues', 'future', 'forecasts', 'potential', 'outlook' and similar expressions, or are events or conditions that 'will', 'would', 'may', 'likely', 'could', 'should', 'can', 'typically', 'traditionally' or 'tends to' occur or be achieved. This news release contains forward-looking statements, pertaining to, among other things, the following: The Company's capital spending forecast and expectations of how it will be funded; near-term impacts from the COVID-19 pandemic; the Company's capital management strategy and financial position; the impact of governmental and Company measures implemented in response to the COVID-19 pandemic; the Company's outlook, activity levels, supply chains and sales channels; loss of markets; further legislative and regulatory developments involving cannabis or otherwise affecting the Company's business or its consumers generally, including delays in the issuance of licenses; competition; currency and interest rate fluctuations; and marketing costs.
Although the Company believes that the material factors, expectations and assumptions expressed in such forward-looking statements are reasonable based on information available to it on the date such statements are made, undue reliance should not be placed on the forward-looking statements because the Company can give no assurances that such statements and information will prove to be correct and such statements are not guarantees of future performance. Since forward-looking statements address future events and conditions, by their very nature they involve inherent risks and uncertainties.
Actual performance and results could differ materially from those currently anticipated due to a number of factors and risks. These include, but are not limited to: known and unknown risks, including those set forth in the Filing Statement dated September 25, 2017 and/or the most recent annual and interim Management's Discussion and Analysis ('MD&A') (a copy of which can be found under Experion's profile on SEDAR at www.sedar.com); a significant expansion of COVID-19 pandemic and the impacts thereof; the Company's ability to raise the necessary capital or to be fully able to implement its business strategy; integration of acquisitions, competition, and uncertainties resulting from potential delays or changes in plans with respect to acquisitions, development projects or capital expenditures and changes in legislation; stock market volatility and the inability to access sufficient capital from external and internal sources; general economic, market or business conditions including those in the event of an epidemic, natural disaster or other event; global economic events; changes to the Company's financial position and cash flow; the availability of qualified personnel, management or other key inputs; currency exchange fluctuations; changes in political and security stability; potential industry developments; and other unforeseen conditions which could impact the Company. Accordingly, readers should not place undue importance or reliance on the forward-looking statements. Readers are cautioned that the foregoing list of factors is not exhaustive and should refer to 'Risk Factors' set out in the MD&A.
Statements, including forward-looking statements, contained in this news release are made as of the date they are given and the Company disclaims any intention or obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws. The forward-looking statements contained in this news release are expressly qualified by this cautionary statement.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
SOURCE: Experion Holdings Ltd.
View source version on accesswire.com: