Supreme Pharma to Issue $40mm Convertible Note

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Supreme Pharma (CSE: SL) (OTC: SPRWF) announced after the close that it will be issuing convertible notes and warrants in a “bought deal” underwritten by Canaccord Genuity. The $40mm convertible note offering has a 12/31/19 maturity, pays interest of 10% and is convertible into shares at $1.30 per share (a total of 30.77mm shares). The company can force conversion in the event shares trade above $1.75 for 15 consecutive trading days. Buyers of the notes will receive 770 warrants at $1.70 for each $1000 invested (a total of 30.8mm shares).

The company, which through its wholly-owned subsidiary 7 Acres (formerly AMMCann) is approved to cultivate cannabis by Health Canada and is expected to become licensed soon for sale, is pursuing a wholesale model exclusively. The capital raise supports the company’s buildout of 7 Acres.  Supreme’s stock posted an all-time high in early October and has consolidated subsequently. Trading was halted just in advance of the close today with the financing news pending.

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Exclusive article by Alan Brochstein, CFA
Alan Brochstein, CFA
Based in Houston, Alan leverages his experience as founder of online communities 420 Investor, the first and still largest due diligence platform focused on the publicly-traded stocks in the cannabis industry. With his extensive network in the cannabis community, Alan continues to find new ways to connect the industry and facilitate its sustainable growth. At New Cannabis Ventures, he is responsible for content development and strategic alliances. Before shifting his focus to the cannabis industry in early 2013, Alan, who began his career on Wall Street in 1986, worked as an independent research analyst following over two decades in research and portfolio management. A prolific writer, with over 650 articles published since 2007 at Seeking Alpha, where he has 70,000 followers, Alan is a frequent speaker at industry conferences and a frequent source to the media, including the NY Times, the Wall Street Journal, Fox Business, and Bloomberg TV. Contact Alan: Twitter | Facebook | LinkedIn | Email

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