(TheNewswire)
Vancouver BC - TheNewswire - October 6 ,2020 - Agrios GlobalHoldings Ltd. (CSE:AGRO) (CNSX:AGRO.CN) (OTC:AGGHF) (FSE:OSA - WKN-A2N62K)("Agrios" or the "Company") provides the followingsummary update regarding management and financial matters below. Links to the complete news releases have been provided in this releasefor the reader's convenience.
market Conditions
Market conditions for the sector have been challengingsince the fall of 2019; during this period, the Company has continuedits efforts to secure financing while making significant changes tocontinue its operations. Below is an outline of the steps the Companyhas taken and accomplished.
Management Updates
On September 9, 2019, the Board of Directors met toreview the financial requirements until December 31, 2020. Uponcompleting the review, the Board met with management, who agreed todefer all management salaries until further notice.
Financing Updates
After the September 9, 2019 meeting, the Companyentered into discussions with several parties to secure the necessaryfinancing required to move the Company forward and refinance themortgage on the Washington State facility held by the Citizens Bank ofNewburg. The Company was able to progress the discussions to thepoint of arranging terms when Covid-19 struck. Potential financiersadvised the Company they would delay their decision on participatinguntil they were able to evaluate the impact of Covid-19 on theirspecific situations. The financing did not move forward as a result ofthe effects of Covid-19. The Company secured a credit facility in theamount of US$3.5 million as outlined in the September 18, 2020 release[for complete release click here ], andcontinues to seek additional financing but has not been successful asof the date of this release.
Convertible Debentures
On June 3, 2019, the Company announced it had arrangeda non-brokered private placement convertible debenture of unsecuredconvertible debentures, for aggregate gross proceeds of up to C$3million dollars. The Company placed C$ 1,011,917 of the Debenture. TheDebentures mature 36 months from the date of issuance and bearinterest at a rate equal to 8% per annum, payable in cash or commonshares of the Company on the last day of each calendar year.
The Company paid C$44,274 on December 31, 2019, byissuing 88,544 shares in the capital of the Company, at the revisedconversion price of C$0.50 per share. As of September 30, 2020,according to the Company's calculations, the Company owes C$60,549 or121,097 shares of common shares to the Convertible Debenture Holdersif paid in shares. For the complete release, click here
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Convertible Credit Facility
On August 30, 2019, the Company announced it hadarranged an unsecured convertible credit facility of up to C$8,113,000from certain lenders. All Notes of the Credit Facility have a maturitydate of 36 months from the date of the advance of funds, and bearinterest at a rate equal to 18% per annum, payable in cash or commonshares of the Company on the last business day of each calendar year,and have a conversion price of C$0.37.
The Company placed C$3,251,500 of this Credit Facility. As a consideration to the lenders for making the Facility available,the Company also issued to the lender's Bonus shares in the amount of4,385,405 common shares of the Company. The Bonus Shares are subjecttransfer restrictions for one year from the date of issuance. As ofSeptember 30, 2020, according to the Company's calculations, theCompany owes C$437,750. in interest, or 1,183,108 common stock to theCredit Facility Debenture holders if paid in shares. For the completerelease, click here
Amended Warrants
On February 14, 2020, the Company announced it hadfiled documentation with the Canadian Securities Exchange (the"CSE") to amend the terms of 920,132 common purchasewarrants issued on March 2, 2018, in connection with a Non BrokeredPrivate Placement convertible at C$0.50 per common share, expiring onMarch 2, 2020. The Company amended the terms to provide for anexpiration date of March 2, 2021. For the complete release, click here
Management Fees and Changes
On September 9, 2019, as previously noted, managementagreed to defer all management salaries until further notice. Deferredsalaries to December 31, 2019 are included in the Q3 December 31,2019, financial statements. Deferrals during the periods of Q4 2020and Q 1 2021, despite numerous reductions have increased the Company'sliabilities.
On May 11, 2020, [for releaseclick here ] June5, 2020, [for release click here ] andSeptember 23, 2020, [for release click here ], theCompany announced the departure of several members of the managementteam and two Directors.
Financial Filings
On July 10, 2020, the Company announced they could notmeet the filing deadline for their March 31, 2020, annual auditedfinancial statements, Management and Analysis Discussion, and June 30,2020, Q1 statements complete with Management and Analysis Discussion.For the complete release, click here
On September 8, 2020, the Company requested andreceived a Management Cease Trade Order
(the "MCTO"), providing an additional 30 days or untilOctober 14, 2020, which it received to file both sets of thestatements and accompanying documents. The Company continues itsefforts to complete the statements.
Financial Data
In the Q3 2020 statements for the period ended December31, 2019, the Company noted US$1,500,000 of restricted cash on thebalance sheet and a mortgage of US$4,218,124. The Citizens Bank ofNewburg held the "unrestricted cash" as security against themortgage. For the complete financial statements, click here
On September 18, 2020, the Company announced it enteredinto a credit facility arrangement with JRV Finance andLease for up to US$3.5-million. JRV Finance andLease is an affiliate of the Company's largest shareholder, J.F.Foster, who serves as a director of Agrios. Thecredit facility was used to pay The Citizens Bank of Newburg thebalance of the mortgage due after applying the restricted cash andproviding up to US$500,000 of working capital. The working capital isallocated to the completion of the rooms at the Washington Statefacility. The amount of the Credit Facility is secured against thebuilding, located in and referred to as the Washington StateFacility. For complete release on credit facility with JRV, click here
In the same statements to Company showed an AccountsReceivable of US$6,382,183. This amount has increased since thestatement date. The Company may be required to take a write-down onits account receivable. Any potential write-downs will be made inconsultation with the Company's auditors and advisors.
For the period ended December 31, 2020, the Companyshowed PPE (Property, Plant, and Equipment) of US$24,553,734. TheCompany may be required to take an impairment charge against thisamount. Any potential impairment charges will be made in consultationwith the Company's auditors and advisors.
The Company showed accounts payable of US$1,102,542, asof December 31, 2019. This amount has increased since that statement.The Company will be discussing with its' creditors resolution of theseamounts on a best-efforts basis.
Additionally, the Company had US$2,705,150 ofConvertible Debentures and Convertible Credit Facility as of December31, 2019, and this amount remains unchanged; however, has interestowing as of September 30, 2020, according to the Company'scalculation, of C$498,299, and 1,304,205 common shares of the Companyif paid in shares.
About Agrios Global HoldingsLtd.
Agrios Global Holdings is a data analytics-drivenagriculture technology and services company advancing the latestinnovations in indoor growing science. The Company owns, leases andmanages properties and equipment for eco-sustainable agronomy andprovides advisory services to support all aspects of aeroponiccultivation in the cannabis sector. Agrios is actively pursuing newopportunities to expand its portfolio of tenant growers andinfrastructure assets in strategic licensed jurisdictions. Based inVancouver, BC. Agrios is managed by a highly accomplished team ofexperienced industry and capital markets experts who are committed tothe growth of the Company.
For further information, please contact:
Chris Kennedy
Director
801-455-4755
investor@agriosglobal.com
This news release was prepared by the management ofAgrios, which takes full responsibility for its contents. The CanadianSecurities Exchange ("CSE") has not reviewed and does notaccept responsibility for the adequacy of this news release. Neitherthe CSE nor its Regulation Services Provider (as that term is definedin the policies of the CSE) accepts responsibility for the adequacy oraccuracy of this release.
Forward Looking Statements
Statements in this news release that areforward-looking statements are subject to various risks anduncertainties concerning the specific factors disclosed here andelsewhere in Agrios' periodic filings with Canadian securitiesregulators. When used in this news release, words such as "will,could, plan, estimate, expect, intend, may, potential, believe,should," and similar expressions, are forward-lookingstatements.
Forward-looking statements may include, withoutlimitation, statements related the use of the funds from the CreditFacility.
Although Agrios has attempted to identify importantfactors that could cause actual results, performance or achievementsto differ materially from those contained in the forward-lookingstatements, there can be other factors that cause results, performanceor achievements not to be as anticipated, estimated or intended,including, but not limited to: dependence on obtaining regulatoryapprovals; investing in target companies or projects which havelimited or no operating history and are engaged in activitiescurrently considered illegal under US Federal laws; change in laws;limited operating history; reliance on management; requirements foradditional financing; competition; hindering market growth and stateadoption due to inconsistent public opinion and perception of themedical-use and adult-use marijuana industry and; regulatory orpolitical change.
There can be no assurance that such information willprove to be accurate or that management's expectations or estimates offuture developments, circumstances or results will materialize.Because of these risks and uncertainties, the results or eventspredicted in these forward-looking statements may differ materiallyfrom actual results or events.
Accordingly, readers should not place undue reliance onforward-looking statements. The forward-looking statements in thisnews release are made as of the date of this release. Agrios disclaimsany intention or obligation to update or revise such information,except as required by applicable law, and Agrios does not assume anyliability for disclosure relating to any other company mentionedherein.
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