ELSE NUTRITION HOLDINGS INC. (TSX: BABY) (OTCQX: BABYF) (FSE: 0YL)
(the “
Company”) is pleased to announce that the
Company has entered into a definitive convertible security funding
agreement (the “
Agreement”) with Lind Global Fund
II LP, an entity managed by The Lind Partners, LLC, a New
York-based institutional fund manager (together,
“
Lind”). Under the terms of the Agreement, the
Company will on closing issue an initial convertible security (the
“
Initial Convertible Security”)
with a face value of US$5,100,000, which would provide US$4,133,125
in funds after deduction of the original issue discount and closing
fees.
On closing, the Initial Convertible Security
will have a 36-month maturity date, and will be convertible into
common shares of the Company (the “Shares”) after
completion of a 120 day lock-up period. Lind will be able to
convert 1/20th of the face value each month at a conversion price
equal to 85% of the five-day volume weighted average price of the
Shares immediately prior to each conversion, subject to a right to
increase conversions in certain circumstances. The outstanding face
value of the Initial Convertible Security, after 180 days, may be
repaid in cash at the discretion of the Company, with a 5% premium
(the “Buy-Back Right”). Should the Company
exercise its Buy-Back Right, Lind would have the option to convert
up to 33% of the face value of the Initial Convertible Security
into Shares.
Following the Initial Convertible Security
issuance, the Company would have the right to draw a further
US$1,250,000 (which may be increased to US$3,000,000 upon mutual
agreement) (the “Second Draw”), subject to the
terms of the formal agreements, and thereafter an optional
follow-on investment of up to US$6,500,000, (the “Third
Draw”), upon mutual agreement, in exchange for the
issuance of additional convertible notes.
The Initial Convertible Security, and each of
the additional convertible notes, if applicable, will include
detached warrants (the “Warrants”) to purchase
common Shares. In connection with the Initial Convertible Security,
the Company will issue 8,247,129 Warrants having an exercise price
of C$1.15 per share and an expiry date 48 months from the date of
issuance. The number of Warrants issued on the Second Draw and
Third Draw will be calculated on 75% of the amount of the draw
divided by the VWAP per share during the twenty (20) consecutive
trading days immediately before the closing date of the Second Draw
and the Third Draw. The exercise price of Warrants issued on the
Second Draw and the Third Draw will be equal to the greater of: (i)
the VWAP per share (in Canadian dollars) for the five (5)
consecutive trading days immediately before the date of the Second
Draw or Third Draw closing as applicable, and (ii) 130% of the VWAP
per share (in Canadian dollars) for the twenty (20) consecutive
trading days immediately before the date of the Second Draw or
Third Draw closing as applicable.
The Agreement provides that the Initial
Convertible Security, and the additional convertible notes, if
applicable, will include volume restrictions on resale of the
Shares issued on conversion of the Initial Convertible Security,
and the additional convertible notes, if applicable, as well as
restrictions on short sales.
The proceeds from the issuance of the Initial
Convertible Security will be applied to clinical trials in
connection with FDA and other application processes, as well as
general working capital.
The Company has obtained approval of Toronto
Stock Exchange (“TSX”) for the transactions
described above. Shares issued pursuant to any conversions would be
issued under TSX private placement rules and would not be freely
tradable for four months and one day following closing and would be
subject to restrictions under applicable Canadian and United States
securities laws.
This press release shall not constitute
an offer to sell or a solicitation of an offer to buy nor shall
there be any sale of the securities offered in any jurisdiction in
which such offer, solicitation, or sale would be unlawful. The
securities offered have not been registered under the United States
Securities Act of 1933, as amended (the “U.S. Securities Act”), or
applicable state securities laws, and may not be offered or sold
to, or for the account or benefit of, persons in the United States
or U.S. persons (as both such terms are defined in Regulation S
promulgated under the U.S. Securities Act) absent registration or
an applicable exemption from such registration
requirements.
About The Lind Partners
The Lind Partners manages institutional funds
that are leaders in providing growth capital to small- and mid-cap
companies publicly traded in the US, Canada, Australia and the UK.
Lind’s funds make direct investments ranging from US$1 to US$30
million, invest in syndicated equity offerings and selectively buy
on market. Having completed more than 150 direct investments
totaling over US$1.5 Billion in transaction value, Lind’s funds
have been flexible and supportive capital partners to investee
companies since 2011. For more information, please visit
http://www.thelindpartners.com.
About Else Nutrition Holdings
Inc.
Else Nutrition Holdings Inc. is a food and
nutrition company in the international expansion stage focused on
developing innovative, clean, and plant-based food and nutrition
products for infants, toddlers, children, and adults. Its
revolutionary, plant-based, non-soy formula is a clean-ingredient
alternative to dairy-based formula. Else Nutrition (formerly INDI)
won the “2017 Best Health and Diet Solutions” award at Milan’s
Global Food Innovation Summit. The holding company, Else Nutrition
Holdings Inc., is a publicly-traded company, listed on Toronto
Stock Exchange under the trading symbol ‘BABY’ and is quoted on the
US OTCQX board under the trading symbol ‘BABYF’ and the Frankfurt
Exchange under the symbol ‘0YL’. Since launching its Plant-Based
Complete Nutrition for Toddlers, made of whole foods, almonds,
buckwheat, and tapioca, the brand has received thousands of
powerful testimonials and reviews from parents and gained national
retailer support from Sprouts Farmers Market, and achieved rapid
sales growth. Else became the #1 Best Seller on Amazon in the Fall
of 2020 in the New Baby & Toddler Formula Category. It recently
won the “Best Dairy Alternative” award 2021 at World Plant-Based
Expo and was a Nexty Award Finalist at Expo West 2022 in the
Plant-Based lifestyle category.
For more information, visit
www.elsenutrition.com or @elsenutrition on Facebook and
Instagram.
For more information,
contact:Ms. Hamutal Yitzhak, CEO, Co-Founder &
DirectorELSE Nutrition Holdings Inc.E: hamutaly@elsenutrition.com
P: +972(0)3-6445095
Mr. Sokhie Puar, Lead Director of Else
NutritionE: sokhiep@elsenutrition.com P : 604-603-7787
Investor Relations Contact:
RBMG – RB Milestone Group LLCTrevor Brucato,
Managing DirectorE: Baby@rbmilestone.com www.rbmilestone.com
Lytham Partners, LLCMr. Ben Shamsian New York |
Phoenix E: shamsian@lythampartners.com P: 646-829-9701
Caution Regarding Forward-Looking
Statements
This press release contains statements that may
constitute “forward-looking statements” within the meaning of
applicable securities legislation. Forward-looking statements are
typically identified by words such as “will” or similar
expressions. Forward-looking statements in this press release
include but are not limited to, statements with respect to the
funding under the Agreement and the issuance of convertible
securities, including the Initial Convertible Security, and
warrants under the Agreement. These forward-looking statements are
made as of the date of this press release. Such forward-looking
statements reflect current estimates, beliefs and assumptions,
which are based on management’s perception of current conditions
and expected future developments, as well as other factors
management believes are appropriate in the circumstances. Although
the Company believes the forward-looking statements in this press
release are reasonable, it can give no assurance that the
expectations and assumptions in such statements will prove to be
correct. The Company cautions investors that any forward-looking
statements by the Company are not guarantees of future results or
performance, and are subject to risks, uncertainties, assumptions
and other factors which could cause events or outcomes to differ
materially from those expressed or implied by such forward-looking
statements. Such factors and assumptions include, among others, the
ability of the Company and Lind to negotiate the terms of the
definitive funding agreement, variations in market conditions;
currency exchange rates; the Company’s ability to obtain any
necessary permits, consents or authorizations required for its
activities; the Company’s ability to access further funding, to
continue its projected growth, or to be fully able to implement its
business strategies. In addition, there are known and unknown risk
factors which could cause our actual results, performance or
achievements to differ materially from any future results,
performance or achievements expressed or implied by the
forward-looking statements. Actual results may differ from the
estimates, beliefs and assumptions expressed or implied in the
forward-looking statements. Readers are cautioned not to place
undue reliance on any forward-looking statements, which reflect
management’s expectations only as of the date of this press
release. The Company disclaims any obligation to update or revise
any forward-looking statements, whether as a result of new
information, future events or otherwise, except as required by
law.
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