Noveris convertible debenture acquired by JJK Holdings

Executive Summary

• JJK Holdings Ltd. acquired a convertible debenture from Pioneer Garage Ltd. (controlled by Ray Van Empel) in the principal amount of $7,878,792.
• The acquisition triggers early warning reporting requirements under National Instrument 62-103, as the potential conversion of the debenture would result in JJK holding approximately 97.18% of Noveris Health Sciences Inc.'s outstanding shares.
• Prior to this transaction, JJK held no securities in Noveris; upon completion, Pioneer and its principal, Mr. Van Empel, hold no securities in the company.

Key Details

• Transaction Structure: JJK Holdings Ltd. acquired a convertible debenture previously held by Pioneer Garage Ltd. via a privately negotiated purchase agreement.
• Principal Amount: $7,878,792.
• Maturity Date: October 14, 2026.
• Conversion Terms: The debenture is convertible at the holder's option at a price equal to the greater of:
  • The 20-day trailing volume-weighted average trading price (VWAP) of Noveris common shares as of the conversion date.
  • The minimum conversion price permitted by the Canadian Securities Exchange (CSE).
• Potential Dilution/Ownership Impact:
  • Based on an illustrative conversion price of $0.18 per share (the most recent CSE closing price), the debenture could result in the issuance of 42,588,065 common shares to JJK.
  • This represents approximately 97.18% of Noveris's issued and outstanding shares (totaling 1,235,061 shares pre-conversion).
• Pre-Transaction Holdings:
  • JJK Holdings: 0% ownership/control.
  • Pioneer Garage Ltd.: Held the debenture (equivalent to ~97.18% if converted).
  • Mr. Ray Van Empel: Held 2 common shares (nil%).
• Post-Transaction Holdings:
  • JJK Holdings: Holds the debenture (potential for 97.18% equity ownership).
  • Pioneer Garage Ltd.: 0% ownership.
  • Mr. Ray Van Empel: Continues to hold 2 common shares (nil%).
• Regulatory Filings: Early warning reports filed pursuant to National Instrument 62-103 and National Instrument 62-104.
• Future Intent: JJK may transfer the debenture to third parties or acquire additional securities for investment purposes, subject to market conditions and regulatory compliance.

Notable Quotes

• No direct quotes from the CEO/President were included in the body of the release text provided.