Abacus Health Products Enters Into $15 Million Bought Deal Equity Financing
TORONTO, April 12, 2019 (GLOBE NEWSWIRE) — Abacus Health Products, Inc. (CSE: ABCS) (“Abacus” or the “Company”), is pleased to announce that it has entered into a letter of engagement with Eight Capital, under which Eight Capital has agreed to purchase, as sole bookrunner and lead underwriter, along with a syndicate of underwriters (the “Underwriters”), 1,071,500 units of the Company (the “Units”), on a “bought deal” basis pursuant to a filing of a short form prospectus, subject to all required regulatory approvals, at a price per Unit of $14.00 (the “Issue Price”) for gross proceeds of $15,001,000 (the “Offering”).
The Company has agreed to grant the Underwriters an over-allotment option to purchase up to an additional 15% of the Units at the Issue Price, exercisable in whole or in part, at any time on or prior to the date that is 30 days following the closing of the Offering. If this option is exercised in full, an additional approximately $2,250,150 will be raised pursuant to the Offering and the aggregate proceeds of the Offering will be approximately $17,251,150.
Each Unit will be comprised of one subordinate voting share of the Company (a “Subordinate Voting Share”) and one-half of one Subordinate Voting Share purchase warrant (each whole warrant, a “Warrant”). Each Warrant shall entitle the holder thereof to purchase one Subordinate Voting Share at an exercise price of $18.00, for a period of 36 months following the closing of the Offering.
The Company intends to use the net proceeds of the Offering for the following purposes: To accelerate the company’s marketing and sales programs to increase retail pharmacy store locations from 1,100 to over 10,000 – this includes marketing with influencers, in-store displays, aggressive digital marketing, significant media relations efforts with major North American publishers and media outlets ; for working capital to support the associated increase in sales; and to launch its international distribution activities which include both regulatory approvals and strategic alliances.
The closing date of the Offering is scheduled to be on or about May 3, 2019 and is subject to certain conditions including, but not limited to, the receipt of all necessary approvals, including the approval of the Canadian Securities Exchange and the applicable securities regulatory authorities.
This press 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 state in which such offer, solicitation or sale would be unlawful. The securities being offered have not been, nor will they 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 of the United States Securities Act of 1933, as amended, and applicable state securities laws.
About Abacus Health Products
Abacus is a company engaged in the development and commercialization of over-the-counter (OTC) registered topical medications with active pharmaceutical ingredients and which contain organic and natural ingredients, including a cannabinoid-rich hemp extract containing CBD from Cannabis sativa plant. Abacus’ products are aimed at the rapidly growing markets for topical pain relief and therapeutic skincare and are based on proprietary patent-pending technologies developed by Abacus. Abacus’ formulations combine advanced science with organic and natural ingredients to provide safe relief. Abacus currently offers two lines of products: (i) CBD CLINIC™, marketed to the professional practitioner market, and (ii) CBDMEDIC™, marketed to the consumer market. Abacus’ products are offered across the United States and are produced by a contract manufacturer in a cGMP compliant and audited manufacturing facility.