Hempalta arranges $2-million financing, plans rollback

Executive Summary

• Hempalta Corp. announced a non-brokered private placement of up to 100 million units at $0.02 per unit, raising gross proceeds of up to $2 million, with proceeds allocated to advance its biochar carbon removal program, finance verification and marketing, and support working capital.
• The company reported significant progress in its nature-based carbon credit program, having verified 29,448 carbon credits (tonnes CO2) for the 2024 growing season across 12,669 acres and 38 farms in multiple countries, with sales completed for a portion of these credits.
• Hempalta proposed a one-for-four share consolidation to align its share structure with institutional standards, expected to result in approximately 49 million shares outstanding post-consolidation and post-financing.

Key Details

• Private Placement Structure:
  • Units: Up to 100,000,000 units.
  • Price: $0.02 per unit.
  • Gross Proceeds: Up to $2,000,000.
  • Warrant Terms: Each unit includes one-half common share purchase warrant; each full warrant is exercisable at $0.05 for 24 months from closing.
  • Hold Period: Four months in accordance with applicable securities laws.
  • Regulatory Status: Subject to final acceptance by the TSX Venture Exchange.
• Use of Proceeds:
  • Advance the biochar carbon removal program.
  • Finance verification, marketing, and farmer onboarding for Hemp Carbon Standard.
  • Support working capital.
  • Pursue potential M&A transactions.
  • Strengthen the company's balance sheet.
• Carbon Credit Verification (2024 Season):
  • Credits Verified: 29,448 carbon credits (29,448 tonnes CO2).
  • Land Area: 12,669 acres.
  • Scope: 38 farms in Canada, the United States, the United Kingdom, Ukraine, Sweden, Germany, and Australia.
  • Standard: ISO 14064-2-certified Hemp Carbon Standard methodology.
  • Sales Status: A portion of verified credits has been sold; the remainder is being marketed through Cloverly, omnichannel partners, independent brokers, and other platforms.
• Future Carbon Program Outlook:
  • 2025 Management: Over 14,000 acres under management internationally.
  • Verification Timeline: Final verification of carbon sequestration scheduled for completion in the first half of 2026.
  • Long-term Goal: Development of a 25,000-acre industrial hemp and biochar carbon removal program designed to generate approximately 100,000 verified carbon credits annually.
  • Advisory Engagement: Engaged an independent carbon removals advisory group to lead milestone-based technical and commercialization processes, including financial modeling, life cycle analysis (LCA), biomass sustainability studies, and registry pathway determination.
  • Next Steps: Secure first buyer Letter of Intent (LOI) or term sheet upon completion of milestones (contingent on financing availability).
• Proposed Share Consolidation:
  • Ratio: One-for-four.
  • Timing: Following completion of the financing, subject to shareholder and regulatory approval.
  • Expected Outcome: Approximately 49 million shares outstanding (assuming completion of the $2M private placement and prior to warrant exercise).
  • Rationale: Align share structure with institutional standards and improve marketability.

Notable Quotes

• "We've spent the past year repositioning Hempalta as a focused, verified and credible player in the carbon markets. This work has not been easy, and I want to acknowledge the challenges and patience all of our stakeholders have shown throughout this transition. Our nature-based carbon program represents the next evolution of this vision -- bridging hemp cultivation, the development of biochar applications and registry alignment to unlock meaningful long-term value. With verified credit sales and growing corporate interest, we're entering 2026 with renewed optimism and tangible traction." — Chief Executive Officer