CALGARY,
AB, Nov. 9, 2023 /CNW/ - CE Brands Inc. (TSXV:
CEBI) (the "Company") announces that it has completed the
shares for debt transaction previously announced on October 25, 2023. The Company received final
approval from the TSX Venture Exchange (the "TSXV") for the
transaction and issued 421,974,842 common shares of the Company
(the "New Shares"), at a deemed price of $0.02 per New Share, to certain creditors of the
Company to settle aggregate debts of $8,439,497 (the "Transaction"). Following
the Transaction, the Company intends to consolidate all its issued
and outstanding common shares, including the New Shares (the
"Consolidation"), on a ten-for-one basis.
Transaction
Under the terms of the definitive agreements, the Company issued
an aggregate of 382,265,941 New Shares, representing 85.47% of the
outstanding common shares of the Company on a post-Transaction
basis, to investment vehicles advised or managed by Vesta Wealth
Partners Ltd. ("Vesta"), a "related party" of the Company
under Multilateral Instrument 61-101 Protection of Minority
Security Holders in Special Transactions ("MI 61-101"),
and issued 39,708,901 New Shares, representing 8.88% of the
outstanding common shares of the Company on a post-Transaction
basis, to an arm's length third party to the Company. The shares
were issued effective and outstanding as at October 27, 2023.
Under National Instrument 45-102 Resale of Securities ("NI
45-102") all the New Shares are subject to a four (4) month
hold period ending on February 28,
2024. Under TSXV policies, the New Shares issued to Vesta
are also subject to a four (4) month hold period ending on
February 28, 2024.
Vesta is a related party of the Company, and the issuance of New
Shares to investment vehicles advised or managed by Vesta
constitute "related party transactions" under MI 61-101, as Mr.
Jared Wolk, a director of the
Company, is also a senior officer of Vesta. The board of directors
of the Company and all the directors of the Company that are
independent in respect of the related party transactions have
determined that the related party transactions are exempt from the
formal valuation requirements and minority shareholder approval
requirements under MI 61-101 on the grounds that: (a) the Company
is in serious financial difficulty; (b) the related party
transactions are designed to improve the financial position of the
Company; (c) the terms of the related party transactions are
reasonable in the circumstances of the Company; and (d) the related
party transactions are not subject to bankruptcy or insolvency
proceedings.
Consolidation
The Consolidation will be subject to TSXV acceptance and the
approval of the shareholders of the Company. Management of
the Company plans to hold a special meeting of shareholders for the
purpose of approving the Consolidation in November 2023.
Assuming receipt of TSXV acceptance and shareholder approval of
the Consolidation, the Company expects there to be approximately
42,197,484 post-Consolidation common shares of the Company issued
and outstanding on a non-diluted basis. Investment vehicles advised
or managed by Vesta will have ownership or control or direction
over an aggregate of approximately 38,226,594 post-Consolidation
common shares.
The Company will provide further information on the terms of the
Consolidation and the special meeting of shareholders of the
Company to approve the Consolidation in due course.
About the Company
The Company develops products with leading manufacturers and
iconic brand licensors by utilizing proprietary data that
identifies key market opportunities.
Neither the TSX Venture Exchange nor its regulation services
provider (as defined in the policies of the TSX Venture Exchange)
accepts responsibility for the adequacy or accuracy of this press
release.
Forward-Looking Information
This press release may contain forward-looking information
within the meaning of securities legislation. In general,
forward-looking information refers to disclosure about future
conditions, courses of action, and events. The use of any of the
words "anticipates", "expects", "intends", "will", "would", and
similar expressions are intended to identify forward-looking
information. The forward looking information in this news release
relates to the terms, and the approval of, the Transaction and the
Consolidation. This forward-looking information is based on certain
key expectations and assumptions. Although the Company believes
that the expectations and assumptions on which its forward-looking
information is based are reasonable, undue reliance should not be
placed on the forward-looking information because the Company
cannot give any assurance that they will prove to be accurate. By
its nature, forward-looking information is subject to various risks
and uncertainties, which could cause the actual results and
expectations to differ materially from the anticipated results or
expectations expressed in this press release. Certain of these
risks and uncertainties are more particularly described in the
documents filed by the Company from time to time on SEDAR+ (see
www.sedarplus.ca). Readers are cautioned not to place undue
reliance on this forward-looking information, which is given as of
the date of this press release, and to not use such forward-looking
information for anything other than its intended purpose. The
Company undertakes no obligation to update publicly or revise any
forward-looking information, whether as a result of new
information, future events, or otherwise, except as required by
applicable securities legislation.
SOURCE CE Brands Inc.
