OTTAWA, April 12, 2017 (GLOBE NEWSWIRE) -- Panda Capital Inc. (NEX:PDA.H) (the “Company”) today announces an increase in the size of its concurrent subscription receipt financing (the “Financing”), as previously announced by press release dated March 23, 2017 and in the Company’s filing statement dated March 31, 2017 (the “Filing Statement”). The Financing is being undertaken in connection with the proposed reverse takeover (the “Transaction”) of the Company by ABcann Medicinals Inc. (“ABcann”), which is intended to constitute the Company’s Qualifying Transaction (as defined in the policies of the TSX Venture Exchange (the “TSXV”)). Canaccord Genuity Corp. (“Canaccord Genuity”) and PI Financial Corp. (“PI Financial” and, together with Canaccord Genuity, the “Agents”) have agreed to act as co-lead agents in respect of the Financing.
The Financing as previously announced was to consist of the issuance of 10,000,000 subscription receipts of the Company (each, a “Subscription Receipt”) at a price of $0.80 per Subscription Receipt for gross proceeds of $8,000,000. The Company now intends to issue a total of 12,875,000 Subscription Receipts at a price of $0.80 per Subscription Receipt for gross proceeds of $10,300,000. As previously announced, the Agents will also be granted an over-allotment option to acquire such number of additional Subscription Receipts as is equal to 15% of the Subscription Receipts sold under the Financing (the “Over-Allotment Option”). The Over-Allotment Option will be exercisable until the closing of the Financing. Additional details regarding the terms of the Transaction and the Financing are included in the Filing Statement.
As a result of the increase in the Financing, the number of common shares in the capital of the Company (each, a “Share”) outstanding at the closing of the Transaction will increase from that shown in the Filing Statement, such that there will be 97,203,024 Shares outstanding on completion of the Transaction (or 99,134,274 if the Over-Allotment Option is exercised in full).
The following table sets out information respecting the Company’s expected sources of cash following the completion of the Transaction. The amounts shown in the table are estimates only and are based upon the information available to the Company and ABcann as of the date hereof:
| Sources | Amount ($) |
| Estimated combined working capital of the Company and ABcann as at February 28, 2017 | 389,906 |
| Gross proceeds of Concurrent Subscription Receipt Financing(1) | 10,300,000 |
| Gross proceeds of Concurrent Debenture Financing (see Filing Statement for additional information) | 15,000,000 |
| Estimated funds available to the Company upon completion of the Transaction | 25,689,906 |
| (1) Assuming no exercise of the Over-Allotment Option. If the Over-Allotment Option is exercised in full, an additional | |
| $1,545,000 will be available to the Company. | |
The additional funds will largely be allocated towards additional developments in connection with the expansion of the Vanluven Facility. The following table sets out information respecting the Company’s intended principal uses of funds for the 12 months following the completion of the Transaction. The intended uses of funds may vary based upon a number of factors and variances may be material. The amounts shown in the table are estimates only and are based upon the information available to the Company and ABcann as of the date hereof:
| Use of Funds | Amount ($) |
| Estimated Transaction costs | 350,000(1) |
| Agents’ Commission | 648,900(2) |
| Estimated 12 month general and administration expenses | 2,911,000 |
| Research and development | 650,000 |
| Expansion of Vanluven Facility | 5,000,000 |
| Construction of Kimmett Facility | 14,500,000 |
| Negotiation of international licensing and distribution agreements | 250,000 |
| Unallocated funds | 1,380,006 |
| Total | 25,689,906 |
| (1) Includes legal fees, auditor review fees, filing fees, shareholder meeting fees and Agents’ expenses incurred or expected | |
| to be incurred in connection with the Transaction. | |
| (2) Assuming the investors on the Company’s president’s list subscribe for 20% of the Offering and the Over-Allotment | |
| Option is not exercised. If the investors on the Company’s president’s list subscribe for 20% of the Offering and the | |
| Over-Allotment Option is exercised in full, the total Agents’ Commission will be $757,050. The Agents may elect to | |
| settle up to 3.5% of the 7% cash commission in shares of the Company. | |
The table below sets out the differences in the fully diluted share capital of the Company after giving effect to the increase to the Financing, as compared to the disclosure included in the Filing Statement. For additional information with respect to the amounts set out in the table below, please refer to the section entitled “Information Concerning the Resulting Issuer – Fully Diluted Share Capital” in the Filing Statement.
| Description of Security | As disclosed in Filing Statement | After Giving Effect to Financing Increase |
| Resulting Issuer Shares outstanding | 94,328,024(1) | 97,203,024(1) |
| Resulting Issuer Shares issuable on exercise of Agents’ Warrants | 700,000 | 901,250(1) |
| Resulting Issuer Shares issuable on exercise of outstanding stock Options | 9,410,951 | 9,410,951 |
| Resulting Issuer Shares issuable on exercise of outstanding Warrant | 38,810,680 | 38,810,680 |
| Resulting Issuer Shares issuable on exercise of outstanding RSUs | 2,972,888 | 2,972,888 |
| Resulting Issuer Shares issuable on conversion of ABcann 2016 Debentures | 7,812,500 | 7,812,500 |
| Resulting Issuer Shares issuable on conversion of ABcann 2016 Loan | 2,297,561 | 2,297,561 |
| Resulting Issuer Shares issuable on conversion of Resulting Issuer Debentures | 14,423,077 | 14,423,077 |
| Fully Diluted Total | 170,755,681 | 173,831,931 |
| (1) Assumes exercise of all Subscription Receipts in connection with the closing and no exercise of the Over-Allotment | ||
| Option. If the Over-Allotment Option is exercised in full, an additional 1,931,250 Shares will be outstanding at closing, | ||
| after conversion of the Subscription Receipts issuable on exercise of the Over-Allotment Option. | ||
The Subscription Receipts to be issued under the Financing, and the Shares into which the Subscription Receipts will be exercised, will be legended with a hold period in accordance with applicable securities laws and, if required, the policies of the TSXV. None of the securities to be issued pursuant to the Financing have been or will be registered under the United States Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements. This news release shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of the securities, in any jurisdiction in which such offer, solicitation or sale would require registration or otherwise be unlawful.
Results of Annual General and Special Meeting
The Company also announces the results of its annual general and special meeting of shareholders held on March 30, 2017 (the “Meeting”).
The Company put forward nine resolutions to be voted on by shareholders at the Meeting, including resolutions: (i) to elect directors of the Company, effective as of the closing of the Meeting; (ii) assuming completion of the Transaction, to increase the number of directors of the Company and approve the election of a new slate of directors effective as of the closing of the Transaction; (iii) to approve a name change of the Company to “ABcann Global Corporation”, or such other name as may be approved by the board of directors of the Company; (iv) to ratify the appointment of MNP LLP as auditor of the Company for the years ended December 31, 2014, 2015 and 2016; (v) to approve the appointment of MNP LLP as auditor of the Company for the year ending December 31, 2017; (vi) to approve the adoption of a new stock option plan; (vii) to approve the adoption of a restricted share unit plan; (viii) to approve the adoption of new bylaws that contain an advance notice provision with respect to the process for shareholder nominations of directors; and (ix) to ratify and approve all acts of the directors and officers of the Company since the last general meeting of the shareholders. The resolutions were outlined in the Company’s management information circular dated February 27, 2017, which is available under the Company’s profile on SEDAR at www.sedar.com.
A total of 1,622,347 of the 2,812,500 outstanding Shares were voted at the Meeting, representing 57.8% of the outstanding Shares. All of the Shares were voted unanimously in favour of all matters to be approved at the Meeting.
Completion of the Transaction is subject to a number of conditions, including but not limited to, TSXV acceptance and if applicable pursuant to TSXV requirements, majority of the minority shareholder approval. Where applicable, the Transaction cannot close until the required shareholder approval is obtained. There can be no assurance that the Transaction will be completed as proposed or at all.
Investors are cautioned that, except as disclosed in the management information circular or filing statement to be prepared in connection with the Transaction, any information released or received with respect to the Transaction may not be accurate or complete and should not be relied upon. Trading in the securities of a capital pool company should be considered highly speculative.
The TSXV has in no way passed on the merits of the proposed Transaction and has neither approved nor disapproved the contents of this press release.
ON BEHALF OF THE BOARD OF DIRECTORS OF PANDA CAPITAL INC.
“Aaron Keay”
Aaron Keay
Director
For further information, please contact Aaron Keay by phone at (604) 323-6911 or by email at aaron@informcapital.com.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Disclaimer for Forward-Looking Information
Certain statements in this release are forward-looking statements, which are statements that are not purely historical, including any statements regarding beliefs, plans, expectations or intentions regarding the future. Forward looking statements in this news release include statements relating to the Financing, the funds available to the Company on completion of the Transaction and the proposed use of such funds. Such statements are subject to risks and uncertainties that may cause actual results, performance or developments to differ materially from those contained in the statements, including that: the TSXV may not give final approval for the Transaction; the Transaction may not be completed for any other reason, including failure to obtain any necessary shareholder approval; that delays may occur in timing of completion of the Financing; and other factors beyond the Company’s control. No assurance can be given that any of the events anticipated by the forward-looking statements will occur or, if they do occur, what benefits the Company or the Resulting Issuer will obtain from them. Readers are urged to consider these factors, and the more extensive risk factors included in the Filing Statement, carefully in evaluating the forward-looking statements contained in this news release and are cautioned not to place undue reliance on such forward-looking statements, which are qualified in their entirety by these cautionary statements. These forward-looking statements are made as of the date hereof and the Company disclaims any intent or obligation to update publicly any forward-looking statements, whether as a result of new information, future events or results or otherwise, except as required by applicable securities laws.