Alliance Growers Increases Private Placement, Amends Pricing Of Stock Options

Alliance Growers Corp. (CSE:ACG) has increased the number of units being offered pursuant to a non-brokered private placement announced Nov. 8, 2016. The offering has been increased from 10,000,000 units (the “Units”) at a price of $0.20 per Unit, to a maximum of 15,000,000 Units for gross proceeds of up to $3,000,000.
Each Unit is comprised of one common share and one share purchase warrant. Each share purchase warrant will entitle the holder to acquire one additional common share in the capital of the Company at a price of $0.30 per share, for a period of two years from the date the Units are issued. If during the exercise period of the warrants, but after the resale restrictions on the shares have expired, the Company’s shares trade at or above a weighted average trading price of $0.45 per share for 10 consecutive trading days, the Company may accelerate the expiry time of the warrants by giving written notice to warrant holders that the warrants will expire 30 days from the date of providing such notice.
A portion of the Private Placement may be completed in accordance with the exemption set out in BC Instrument 45-534 (Exemption from prospectus requirement for certain trades to existing security holders) (the “Security Holder Exemption”) pursuant to the terms and conditions of this Offering News Release and BC Instrument 45-534. Alliance shall make the pro-rata offer available to all persons who, as of the record date of November 7, 2016, held common shares in the capital of the Company. In accordance with the requirements of the Security Holder Exemption, the Company confirms there is no material fact or material change related to the Company which has not been generally disclosed.
The Private Placement securities have not been and will not be registered under the U.S. Securities Act of 1933, as amended (the “1933 Act”), or under any state securities laws, and may not be offered or sold, directly or indirectly, or delivered within the United States or to, or for the account or benefit of, U.S. persons (as defined in Regulation S under the 1933 Act) absent registration or an applicable exemption from the registration requirements. This news release does not constitute an offer to sell or a solicitation to buy such securities in the United States.
The Company plans to allocate the proceeds of the Private Placement primarily to the Botany Centre for property acquisition and preliminary planning and development, plus Investments in Licensed Growers and at various stages of the license process, investments in other potentially lucrative arrangements in the medical and recreational cannabis space, as well as general working capital. The financing is subject to regulatory approval. All securities issued pursuant to the placement will be subject to a hold period of four months and one day from the date of closing.
The Board of Directors has been advised that the January 3, 2017 press release was in contravention of Canadian Securities Exchange Policy, where announced Options were priced incorrectly, as they may not be granted at a discount, but rather the higher of the closing price the day before, or the closing price the day of the grant.
The Company has adjusted the pricing for the grant to $0.185 for 1,750,000 options to directors, officers and consultants of the Company, which options are exercisable into common shares of the Company at a price of $0.185 per share. Subject to the rules of the Canadian Securities Exchange and the Company’s Stock Option Plan, the options have a term of five years and will expire on January 2, 2022. At the time of the grant closing price of Alliance common shares was $0.185.
About Alliance Growers Corp.
Alliance Growers is a diversified cannabis company driven by the Company’s ‘Four Pillars’ Organization Plan – MMPR cannabis production facilities, distribution network, consumer products, and research and development.
Alliance has finalized a Definitive License Agreement with B.R.I.M. for a Canada Exclusive License to jointly develop and operate cannabis Botany Centres. The initial project is planned as a staged development of a 40,000 square foot facility being located near Vancouver, B.C., to be the first of its kind in Western Canada to house a DNA Botany lab, extraction facility and Tissue Culture Plantlet Production facility to service the cannabis market and agriculture market in general. The planned facility will grow cannabis plantlets using proprietary tissue culture propagation, specifically the “Chibafreen Invitro Plant Production System”, which assures consistent composition and purity of each plantlet for the growers. As well, Alliance Growers is negotiating to obtain exclusive Canadian distribution agreements for certain proprietary products for support of the cannabis growing industry in addition to possible partnerships with existing MMPR licensed and soon-to-be licensed facilities.