Organto Closes Third Tranche of the Oversubscribed Financing

Rhea-AI Summary

Organto Foods has successfully closed the third tranche of its unsecured convertible debenture financing, raising $500,000 in gross proceeds. This financing is part of a larger fundraising effort that has generated total gross proceeds of CAD $1,033,000. The debentures carry a 10% annual interest rate and mature in December 2024, convertible into common shares at CDN $0.30 per share. If Organto's share price exceeds CDN $0.45 for 10 consecutive trading days, the company may accelerate conversion. The funds will support growth initiatives and general working capital.

Positive

• Total gross proceeds from the financing reached CAD $1,033,000.
• The 10% interest rate on debentures is favorable for fundraising.
• No finder's fees were paid, leading to cost-efficient financing.
• Proceeds will be allocated to growth initiatives and working capital.

Negative

• Dependency on stock price performance for conversion of debentures could create volatility.
• The need for raising additional capital may indicate liquidity concerns.

TORONTO, ON and BREDA, THE NETHERLANDS / ACCESSWIRE / April 3, 2023 / Organto Foods Inc. (TSX-V: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 third and final tranche of its previously announced (see December 13, 2022, February 24, 2023, and March 23, 2023 news releases) private placement of unsecured convertible debentures ("Debentures").

The Debentures issued in this, the third and final tranche, were for gross proceeds of $500,000 and will mature in December 2024. These Debentures bear interest at an annual interest rate of 10% 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 the conversion of the Debentures. There is no pre-payment penalty.

No finder's fees were paid or are payable in connection with this tranche of the Debenture financing.

Marketing of the private placement has now been completed. The Company raised total gross proceeds of CAD $1,033,000, and net proceeds of $990,487 after fees and related costs. In addition, 106,600 broker warrants were issued with an exercise price of $0.30 and a term of two years. Any common shares issued upon the conversion of the Convertible Notes or exercise of the broker warrants will be subject to hold periods that expire in June and July 2023. Funds raised in the three tranches 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.

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/747172/Organto-Closes-Third-Tranche-of-the-Oversubscribed-Financing

FAQ

What is the total amount raised by Organto Foods in its recent financing?

Organto Foods raised a total of CAD $1,033,000 in gross proceeds from its recent financing.

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

The convertible debentures issued by Organto Foods bear an annual interest rate of 10%.

When will the convertible debentures mature?

The convertible debentures will mature in December 2024.

What price will Organto Foods' debentures convert into common shares?

The debentures are convertible into common shares at a price of CDN $0.30 per share.

What will the funds raised from the debenture financing be used for?

The funds raised will support growth initiatives and general working capital purposes.