Jan. 23, 2019, VANCOUVER – Nextleaf Solutions Ltd. is pleased to announce that it has appointed a syndicate of agents led by Mackie Research Capital Corporation (as the “Lead Agent” and sole book runner) and including Industrial Alliance Securities Inc. and Gravitas Securities Inc. (collectively, the “Agents“) to conduct a marketed private placement of units (the “Units“) at a price of $0.35 per Unit for gross proceeds of up to $4,000,000 (the “Offering“).
The Company has also granted the Agents an over-allotment option (the “Agents’ Option“) to increase the size of the Offering by up to 15% in Units or, with the written consent of Nextleaf and Legion Metals Corp., such consent not to be unreasonably withheld, more by giving written notice of the exercise of the Agents’ Option, or a part thereof, to the Company at any time up to 48 hours prior to the closing of the Offering. The Agents’ Option will be on the same terms and conditions of the Offering, exercisable in whole or in part.
Each Unit will be comprised of one common share in the capital of the Company (a “Common Share“) and one common share purchase warrant of the Company (a “Warrant“). Each Warrant shall be exercisable to acquire one Common Share (a “Warrant Share“) at price per Warrant Share of $0.70 for a period of 24 months from the Closing Date (as defined herein).
Provided that the Common Shares trade above $1.25 per share for 20 consecutive trading days, then the expiry date of the Warrants will be automatically accelerated to the date that is 30 days after the date the Company provided notice by press release to the holders of the Warrants.
In connection with the Offering, Nextleaf will pay a cash commission of 8.0% of the aggregate gross proceeds raised, and grant options exercisable at any time up to 24 months following the closing date to purchase shares of the Company in an amount equal to 8.0% of the number of Units sold in connection with the Offering. A corporate finance fee will also be payable by Nextleaf to Mackie Research Capital Corporation.
In addition, the Company is also conducting a concurrent non-brokered private placement and with Hunter Capital Advisory (Australia) as a selling group member, on the same terms as the Offering, for gross proceeds of up to $3,000,000. Finder’s fees may be payable in connection with the non-brokered private placement.
The Company intends to use the net proceeds from the Offering and the non-brokered private placement to accelerate the Company’s growth, including the purchase of equipment to further increase capacity, continued intellectual property development, and for general corporate purposes.
As Nextleaf is a private company, the securities issued in connection with the Offering and the non-brokered private placement will be subject to restrictions on transfer in accordance with Nextleaf’s Articles.
The shareholders of Nextleaf and the securityholders of Legion Metals Corp. (“Legion“) (CSE: LEGN) have provided approval of a transaction which will result in all of the securities of Nextleaf (including any securities issued pursuant to the Offering) being exchanged for equivalent securities of Legion by way of plan of arrangement (the “Transaction“). The Supreme Court of British Columbia has also granted a final order approving the Transaction.
The Transaction is subject to the satisfaction of certain conditions, including the completion of a private placement for minimum gross proceeds of $3,000,000. Upon completion of the Transaction, and subject to receipt of approval from the Canadian Securities Exchange (the “CSE“), it is expected that Nextleaf will commence trading on the CSE under the ticker OILS.