Else Nutrition obtains up to $1.28M (U.S.) investment

Executive Summary

• Else Nutrition Holdings Inc. has entered into a convertible security funding agreement with Lind Global Fund III LP for gross proceeds of up to US$1,280,000.
• The initial closing involves the issuance of a convertible security with a face value of $420,000, netting approximately $337,750 in funds after original issue discounts and fees.
• The transaction includes a buyback option for the company after 180 days and optional follow-on investments of up to $310,000 each for three additional tranches.

Key Details

• Initial Financing Structure:
  • Face Value: $420,000 (U.S.)
  • Net Proceeds: $337,750 (U.S.) (after deduction of original issue discount and closing fees)
  • Maturity: 24 months
  • Use of Proceeds: Production and general working capital purposes
• Conversion Terms:
  • Convertible into common shares subject to a four-month lockup period.
  • Conversion Rate: Lind may convert 1/20th of the face value each month.
  • Conversion Price: Greater of (i) 80% of the 5-day VWAP immediately prior to conversion, or (ii) the 5-day VWAP immediately prior to conversion less the maximum allowable discount per Toronto Stock Exchange policies.
• Buyback Right:
  • After 180 days, the company may repay the outstanding face value in cash at its discretion with a 5% premium.
  • If exercised, Lind has the option to convert up to 33% of the face value into shares.
• Follow-On Investment Options:
  • Three optional follow-on investments of up to $310,000 (U.S.) each, upon mutual agreement, resulting in the issuance of second, third, and fourth convertible securities.
• Warrant Terms:
  • Initial Closing: 2,069,781 detached warrants issued.
  • Warrant Exercise Price: 130% of the 5-day VWAP immediately prior to the closing date.
  • Warrant Expiry: 48 months from issuance.
  • Subsequent Draws: Warrants issued for second, third, and fourth draws calculated by dividing the dollar amount of the draw by the 5-day VWAP prior to closing, with an exercise price of 130% of that VWAP and 48-month expiry.
• Regulatory & Trading Restrictions:
  • TSX Approval: Conditionally approved for listing up to an additional 10,582,354 shares.
  • Lockup: Shares issued upon conversion are not freely tradable for four months and one day following closing.
  • Resale/Short Sales: Volume restrictions on resale and restrictions on short sales apply to shares issued on conversion.