C21 Investments Announces Private Placement of up to $45 Million of Convertible Debentures

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C21 Investments Inc. (“C21” or the “Company”) (CSE: CXXI) (FSE: C6QP) today announced that it has entered into a brokered syndicated private placement led by Industrial Alliance Securities Inc. (the “Lead Agent”) with Canaccord Genuity Corp. and Sprott Capital Partners joining as syndicate members (collectively with the Lead Agent, the “Agents”) for the sale of up to 45,000 units of C21 (the “Units”), at a price of $1,000 per Unit, for gross proceeds of a minimum of $20,000,000 and up to a maximum of $45,000,000 (the “Offering”).

In addition, C21 has granted the Agents an over-allotment option, exercisable in whole or in part, at the discretion of the Agents, to arrange for the purchase of up to an additional 15% of the Units sold by the Agents, at any time until the closing of the Offering.

Each Unit consists of one $1,000 principal amount 10% unsecured convertible debenture (the “Debenture”) and one-half of one non-transferable debenture warrant (each whole warrant, a “Warrant”). Each Warrant will entitle the holder thereof to purchase, for a period of 24 months from the date of issue, one additional $1,000 principal amount 10% unsecured convertible debenture (a “Warrant Debenture”) at an exercise price of $1,000 per Warrant Debenture. The Debentures are convertible to common shares of C21 at a price of $1.50 per common share. The Warrant Debentures are convertible into common shares of C21 at a price of $2.25 per common share. The Debentures and Warrant Debentures will mature two years from the date of issuance of the Debentures.

“This additional capital will accelerate our growth and expansion plans in the United States and globally,” said Robert Cheney, Chief Executive Officer of C21. “It is exciting to participate in an industry growing as rapidly as ours and with a regulatory landscape that continues to improve.”

Net proceeds from the Offering are intended to be used primarily to complete previously announced acquisitions in the United States, and to upgrade and expand the acquired businesses.

In consideration of the services rendered by the Agents in connection with the Offering, C21 has agreed to pay the Agents on the closing of the Offering an aggregate cash fee equal to: (a) 6.0% of the gross proceeds of the Offering resulting from the sale of Units to purchasers (other than purchasers identified on a mutually agreed upon subscriber list (the “President’s List”)); and (b) 3% of the gross proceeds of the Offering resulting from the sale of Units to purchasers on the President’s List.  In addition, C21 has agreed to issue to the Agents warrants for the purchase of Debentures in a number equal to: (a) 6% of the number of Units sold to purchasers (other than to purchasers on the President’s List); and (b) 3% of the number of Units sold to purchases on the President’s List.

Closing of the Offering is expected to occur November 28, 2018 and is subject to a number of conditions, including receipt of all necessary corporate and regulatory approvals, including the Canadian Securities Exchange (the “CSE”).

This news release does not constitute an offer to sell or a solicitation of an offer to buy any securities in the United States, nor shall there be any sale of the securities in any jurisdiction in which such offer, solicitation or sale would be unlawful. The securities described herein have not been, and will not be, registered under the United States Securities Act of 1933, as amended (the “U.S. Securities Act”), or any state securities laws, and, accordingly, may not be offered or sold within the United States, or to or for the account or benefit of persons in the United States or “U.S. Persons”, as such term is defined in Regulation S promulgated under the U.S. Securities Act, unless registered under the U.S. Securities Act and applicable state securities laws or pursuant to an exemption from such registration requirements.