Halo Announces Meeting of Debentureholders

TORONTO – Halo Collective Inc. (NEO: HALO) (OTCQB: HCANF) (Germany: A9KN) announced that it has mailed a notice of meeting and management information circular to the holders of its 8.00% unsecured convertible debentures due April 4, 2022 in connection with a meeting of the Debentureholders to be held at 11 a.m. (Toronto Time) on February 15, 2022.

At the Meeting, the Debentureholders will be asked to consider, and if deemed advisable, to pass an extraordinary resolution to amend the certificates between the Company and each of the Debentureholders, which will amend the Convertible Debentures to: (i) extend the maturity date of the Convertible Debentures to December 31, 2024; (ii) reduce the interest rate of the Convertible Debentures to 0.0%; (iii) amend the conversion terms of the Convertible Debentures to make such debentures convertible into units; (iv) lower the conversion price of the Convertible Debentures; and (v) provide the Company with a right to accelerate the conversion of the Convertible Debentures, all as more particularly described in the Information Circular.

If the resolution is passed, among other changes, each Convertible Debenture will become convertible into units of the Company consisting of one (1) common share of the Company and one half of one (1/2) Common Share purchase warrant. Each Warrant will entitle the holder thereof to acquire one (1) Common Share at an exercise price of $2.35 per Common Share until February 15, 2024. In addition, the conversion price of the Convertible Debentures will be equal to the lower of (i) $1.38, and (ii) the greater of: (A) the 10-day volume weighted average price of the Common Shares on the Neo Exchange Inc. on the date prior to the Meeting; and (B) the closing price of the Common Shares on the NEO on the date prior to the Meeting.

As the resolution is an extraordinary resolution, to be effective, the resolution must be passed by at least 662/3% of the aggregate principal amount of the Convertible Debentures represented in person or represented by proxy at the Meeting. If the resolution is passed at the Meeting, the amendments to the Convertible Debentures are expected to come into immediate effect and Debentureholders shall be entitled to receive any accrued and unpaid interest in respect of the Convertible Debentures up to the date of amendment. As of January 14, 2022, being the record date for the Meeting, approximately CDN$12,649,000 aggregate principal amount of Convertible Debentures are issued and outstanding.

The Company has engaged Paterson Partners as financial advisor in connection with the proposed amendments to the Convertible Debentures and the Meeting.

Cautionary Note Regarding Forward-Looking Information and Statements

This press release contains certain “forward-looking information” within the meaning of applicable Canadian securities legislation and may also contain statements that may constitute “forward-looking statements” within the meaning of the safe harbor provisions of the United States Private Securities Litigation Reform Act of 1995. Such forward-looking information and forward-looking statements are not representative of historical facts or information or current condition, but instead represent only Halo’s beliefs regarding future events, plans or objectives, many of which, by their nature, are inherently uncertain and outside of Halo’s control. Generally, such forward-looking information or forward-looking statements can be identified by the use of forward-looking terminology such as “plans”, “expects” or “does not expect”, “is expected”, “budget”, “scheduled”, “estimates”, “forecasts”, “intends”, “anticipates” or “does not anticipate”, or “believes”, or variations of such words and phrases or may contain statements that certain actions, events or results “may”, “could”, “would”, “might” or “will be taken”, “will continue”, “will occur” or “will be achieved”. Forward-looking information may relate to anticipated events or results including, but not limited to the expected conversion price of the Convertible Debentures, the date of the Meeting, the proposed amendments to the Convertible Debentures, management’s plans regarding its portfolio of cannabis businesses, the Company’s expansion plans regarding Canada, the expected size and capabilities of the final facility planned at Ukiah Ventures, the size of Halo’s planned cultivation facility in Northern California, and the ability of Bophelo and Canmart to serve the UK market and the proposed spin-off by Halo Tek Inc.

By identifying such information and statements in this manner, Halo is alerting the reader that such information and statements are subject to known and unknown risks, uncertainties and other factors that may cause the actual results to be materially different from those expressed or implied by such information and statements. In addition, in connection with the forward-looking information and forward-looking statements contained in this press release, Halo has made certain assumptions. Although Halo believes that the assumptions and factors used in preparing, and the expectations contained in, the forward-looking information and statements are reasonable, undue reliance should not be placed on such information and statements, and no assurance or guarantee can be given that such forward-looking information and statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information and statements. Among others, the key factors that could cause actual results to differ materially from those projected in the forward-looking information and statements are the following: inability of management to successfully integrate the operations of acquired businesses, changes in the consumer market for cannabis products, changes in the expected outcomes of the proposed changes to Halo’s operations, delays in obtaining required licenses or approvals necessary for the build-out of Oregon operations, dispensaries or Canadian operations, the proposed spin-out with Halo Tek Inc., delays or unforeseen costs incurred in connection with construction, the ability of competitors to scale operations in Northern California, delays or unforeseen difficulties in connection with the cultivation and harvest of Halo’s raw material, changes in general economic, business and political conditions, including changes in the financial markets; and the other risks disclosed in the Company’s annual information form dated March 31, 2021 and other disclosure documents  available on the Company’s profile at www.sedar.com. Should one or more of these risks, uncertainties or other factors materialize, or should assumptions underlying the forward-looking information or statements prove incorrect, actual results may vary materially from those described herein as intended, planned, anticipated, believed, estimated or expected.

The forward-looking information and forward-looking statements contained in this press release are made as of the date of this press release, and Halo does not undertake to update any forward-looking information and/or forward-looking statements that are contained or referenced herein, except in accordance with applicable securities laws. All subsequent written and oral forward-looking information and statements attributable to Halo or persons acting on its behalf is expressly qualified in its entirety by this notice.

Non-Solicitation

This press release shall not constitute an offer to sell nor the solicitation of an offer to buy any of the securities described herein, nor shall there be any sale of these securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.

(This information is primarily sourced from Halo Collective Inc.  Highly Capitalized has neither approved nor disapproved the contents of this news release. Read our Disclaimer here).