Organto Closes First Tranche of Oversubscribed Financing

Rhea-AI Summary

Organto Foods Inc. (OTCQB:OGOFF) has successfully closed the first tranche of its private placement of unsecured convertible debentures, raising $295,000 in gross proceeds. The debentures will mature in February 2025, carrying a 10% annual interest rate and convertible into common shares at CDN $0.30 per share. Organto aims to raise a total of $1.1 million through multiple tranches to support growth initiatives and general working capital. The company has also relocated its head office to Toronto, Ontario.

Positive

• Successfully raised $295,000 in gross proceeds from the first tranche of convertible debentures.
• Plans to raise a total of $1.1 million to support growth initiatives.
• 10% interest rate on the debentures is attractive for investors.

Negative

• Conversion price of CDN $0.30 is below the anticipated acceleration threshold of CDN $0.45 for conversion.

Relocates Head Office

VANCOUVER, BC and BREDA, THE NETHERLANDS / ACCESSWIRE / February 24, 2023 / Organto Foods Inc. (TSXV:OGO)(OTCQB:OGOFF)(FSE:OGF) ("Organto" or "the Company"), a leading provider of organic and value-added organic fruit and vegetable products, today announced that it has closed the first tranche of its previously announced (see December 13, 2022 and January 26, 2023 news releases) private placement of unsecured convertible debentures ("Debentures").

The Debentures issued in the first tranche were for gross proceeds of $295,000 and will mature in February 2025. These Debentures bear interest at an annual interest rate of 10% (payable annually) and are convertible into common shares of Organto (TSX-V: OGO) at a price of CDN $0.30 per share. If at any time after four months from the date of issuance of the Debentures, the closing price of Organto's common shares as traded on the TSX Venture Exchange is equal to or greater than CDN $0.45 for 10 consecutive trading days or more, Organto may, in its sole discretion, accelerate conversion of the Debentures. There is no pre-payment penalty.

Organto will pay finder's fees of CDN $17,700 in cash and issue 59,000 broker warrants related to this tranche of Debentures. These broker warrants are exercisable at a price of $0.30 and expire in February 2025. Any common shares issued upon the conversion of the Convertible Notes or exercise of the broker warrants will be subject to a hold period that expires in June 2023.

Marketing of the private placement continues, and the Company now expects to raise a total of $1.1 million in multiple tranches. The terms of the Debentures issued in subsequent tranches will be the same as this first tranche, though maturity dates will be different.

Funds raised from the private placement of Debentures will be used to support growth initiatives and for general working capital purposes.

The Debenture financing remains subject to final acceptance by the TSX Venture Exchange.

New head office

The Company also announces that effective immediately, its head office has relocated to Toronto, Ontario at 36 Toronto Street, Suite 805, M5C 2C5.

ON BEHALF OF THE BOARD,

Steve Bromley
Chair and Co-Chief Executive Officer

Neither the 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 news release.

For more information contact:

Investor Relations
info@organto.com
John Rathwell, Senior Vice President, Corporate Development and Investor Relations
647 629 0018

ABOUT ORGANTO

Organto is an integrated provider of branded, private label, and distributed organic and non-GMO fruit and vegetable products using a strategic asset-light business model to serve a growing socially responsible and health-conscious consumer around the globe. Organto's business model is rooted in its commitment to sustainable business practices focused on environmental responsibility and a commitment to the communities where it operates, its people, and its shareholders.

SOURCE: Organto Foods Inc.

View source version on accesswire.com:
https://www.accesswire.com/740632/Organto-Closes-First-Tranche-of-Oversubscribed-Financing

FAQ

What is the significance of the $295,000 raised by Organto Foods in its recent private placement?

Organto Foods raised $295,000 to support growth initiatives and general working capital.

When will the first tranche of debentures mature?

The first tranche of debentures will mature in February 2025.

What is the interest rate on the convertible debentures issued by Organto?

The interest rate on the issued convertible debentures is 10% per annum.

What are the future plans for Organto's private placement financing?

Organto plans to raise a total of $1.1 million in multiple tranches.

Where has Organto Foods relocated its head office?

Organto Foods has relocated its head office to Toronto, Ontario.