Calgary, Alberta--(Newsfile Corp. - January 22, 2024) - Trail Blazing Ventures Ltd. (TSXV: BLAZ.P) (the "Corporation" or "TBV") and Hempalta Inc. ("HEMPALTA") today announced the closing of the previously announced brokered private placement (the "Private Placement") of subscription receipts of HEMPALTA ("Subscription Receipts"). The Private Placement was led by Canaccord Genuity Corp. (the "Agent").
The Private Placement was completed pursuant to an agency agreement dated January 19, 2024 among TBV, HEMPALTA and the Agent. Aggregate gross proceeds for the Private Placement were $1,100,469.67, with 6,473,351 subscription receipts of HEMPALTA (each, a "Subscription Receipt") at $0.17 per Subscription Receipt being issued. Additionally, 176,470 Subscription Receipts were issued to the Agent in connection with the corporate finance fee payable by HEMPALTA to the Agent (the "SR Corporate Finance Fee").
It is intended that, following the completion of the proposed qualifying transaction between TBV and HEMPALTA (the "Qualifying Transaction"), the net proceeds from the Private Placement will be used to pay the remaining costs of the Qualifying Transaction, expand HEMPALTA's Calgary-based processing plant, repay certain indebtedness of HEMPALTA, for general and administrative expenses and for general working capital. Upon completion of the Qualifying Transaction, TBV intends to complete a name change to "Hempalta Corp." (hereinafter referred to as the "Resulting Issuer").
Upon satisfaction or waiver of the escrow release conditions in the Subscription Receipt Agreement (as defined below) (the "Escrow Release Conditions"), each Subscription Receipt will be converted and will entitle the holder thereof to receive, without payment of any additional consideration or further action on the part of the holder, one common share of HEMPALTA, which will be automatically exchanged in connection with the Qualifying Transaction for one common share of the Resulting Issuer (each, a "Resulting Issuer Share").
The gross proceeds of the Private Placement net of the Agent's expenses and the Cash Corporate Finance Fee (the "Escrowed Funds"), are being held in escrow pursuant to the terms of a subscription receipt agreement dated January 19, 2024 among HEMPALTA, the Agent and Odyssey Trust Company ("Odyssey"), as registrar and transfer agent for the Subscription Receipts and as escrow agent for the Escrowed Funds (the "Subscription Receipt Agreement"). Upon satisfaction or waiver of the Escrow Release Conditions, the Escrowed Funds together with any interest earned thereon, will be released to HEMPALTA (and the Agent in respect of the Agent's Commission (as defined below)) in accordance with the terms set out in the Subscription Receipt Agreement. If the Escrow Release Conditions are not satisfied or waived, the Subscription Receipts will be cancelled without any further action and the Escrowed Funds together with any interest earned thereon will be returned to subscribers on a pro rata basis, with any shortage of funds being paid by HEMPALTA.
In connection with the Private Placement, HEMPALTA has (i) paid to the Agent a cash corporate finance fee (the "Cash Corporate Finance Fee") in the amount of $25,000, (ii) issued to the Agent a total of 176,470 Subscription Receipts in satisfaction of the SR Corporate Finance Fee with a value of $30,000, an increase from the value of $25,000 under the previous terms of the Private Placement (the "Previous Terms") disclosed in TBV's news releases dated November 15, 2023 and January 12, 2024, and (iii) issued 154,859 non-transferable Agent's warrants to purchase common shares ("Agent's Warrants"), representing the sum of (a) 35,000 Agent's Warrants, being compensation that was not included in the Previous Terms, and (b) the number of Agent's Warrants ("Subject Agent's Warrants") that is equal to 3% (the percentage issuable in respect of president's list subscribers) of the Subscription Receipts issued to subscribers under the Private Placement that did not settle directly with HEMPALTA (the "Subject Subscribers"), rather than a number equal to 3% of the Subscription Receipts issued to all subscribers under the Private Placement as disclosed in the Previous Terms. In addition, HEMPALTA will pay to the Agent, on satisfaction of the Escrow Release Conditions, $20,375.99 in cash commission (the "Agent's Commission"), representing 3% (the percentage payable in respect of president's list subscribers) of the gross proceeds from the sale of Subscription Receipts to the Subject Subscribers, rather than 3% of the gross proceeds from the sale of Subscription Receipts to all subscribers under the Private Placement as disclosed in the Previous Terms. Under the Previous Terms, Subject Agent's Warrants were issuable to the Agent concurrently with the exchange of the Subscription Receipts into underlying securities (if and when), rather than at the closing of the Private Placement. Each Agent's Warrant entitles the holder thereof to purchase one common share of HEMPALTA at an exercise price of $0.17, subject to adjustment, for a period of 24 months commencing upon satisfaction of the Escrow Release Conditions.
Closing of the Qualifying Transaction is subject to certain conditions, including but not limited to, the receipt of all necessary approvals including acceptance by the TSX Venture Exchange (the "Exchange").
ABOUT TBV
TBV is a capital pool company (a "CPC") that has not commenced commercial operations and has no assets other than cash. Except as specifically contemplated in the Exchange's CPC Policy, until the completion of its qualifying transaction, TBV will not carry on business, other than the identification and evaluation of businesses or assets with a view to completing a proposed qualifying transaction.
ABOUT HEMPALTA
HEMPALTA is a private company incorporated under the Business Corporations Act (Alberta). HEMPALTA makes products from hemp grown sustainably in Southern Alberta and processes the hemp using a state-of-the-art HempTrain Advanced Processing Plant at the company's production facility in Calgary, Alberta into various consumer products which are sold and distributed through various retail channels. HEMPALTA is led by passionate advocates for industrial hemp who have years of operations, manufacturing, marketing, consumer packaged goods, and retail sales experience. In 2023, HEMPALTA was named one of the Top 10 Startups by Calgary's Launch Party and one of the 50 most investable cleantech companies in Canada by Foresight Canada.
For further information, please contact:
Craig Steinberg
Director
Trail Blazing Ventures Ltd.
Telephone: 1-800-503-1875
Email: info@trailblazingventures.com
Darren Bondar
Chief Executive Officer
Hempalta Inc.
Telephone: 1-877-622-3354
Email: info@hempalta.com
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Forward-Looking Information Cautionary Statement
This news release includes forward-looking information ("forward-looking information") within the meaning of Canadian securities laws regarding TBV, HEMPALTA, the Resulting Issuer and their respective businesses, which may include, but is not limited to, statements with respect to the completion, and the terms and conditions, of the Qualifying Transaction, the HEMPALTA business plans, the satisfaction of conditions to closing, including the satisfaction of the Escrow Release Conditions and the actions occur at such time, and the use of the net proceeds from the Private Placement. Often, but not always, forward-looking information can be identified by the use of words such as "plans", "is expected", "expects", "scheduled", "intends", "contemplates", "anticipates", "believes", "proposes", "estimates" or variations of such words and phrases, or state that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved. Such statements are based on the current expectations and views of future events of the management of each entity, and are based on assumptions and subject to risks and uncertainties. Although the management of each respective entity believes that the assumptions underlying the forward-looking information as applicable to them or their respective businesses or the Qualifying Transaction are reasonable, such forward-looking information is subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of TBV, HEMPALTA and the Resulting Issuer to be materially different from those expressed or implied by such forward-looking information and may prove to be incorrect. The forward-looking information, events and circumstances discussed in this release may not occur by certain specified dates or at all and could differ materially as a result of known and unknown risk factors and uncertainties affecting the companies, including the risk that HEMPALTA and TBV may not obtain all requisite approvals for the Qualifying Transaction, including the approval of the Exchange for the Qualifying Transaction (which may be conditional upon amendments to the terms of the Qualifying Transaction), risks of the hemp processing industry, hemp products industry, and consumer products industry, failure to obtain regulatory or shareholder approvals, general business, economic, economic, competitive, political and social uncertainties; the equity markets generally and risks associated with growth and development, general capital market conditions and market prices for securities and junior market securities; hemp prices; hemp processing company market conditions and the market conditions of the hemp products industry in general; competition; and changes in legislation, including hemp-related legislation affecting TBV, HEMPALTA and the Resulting Issuer. Although TBV and HEMPALTA have attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking information, there may be other factors that cause actions, events or results to differ from those anticipated, estimated or intended. Accordingly, readers should not place undue reliance on any forward-looking information contained herein. No statements comprising forward-looking information can be guaranteed. Except as required by applicable securities laws, forward-looking information contained herein speak only as of the date on which they are made and TBV and HEMPALTA undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise.
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SOURCE: Trail Blazing Ventures Ltd.
