Organto Foods Announces Increase to Private Placement Financing

Rhea-AI Summary

Organto Foods Inc. (TSX-V:OGO)(OTC PINK:OGOFF) has announced an increase in its non-brokered private placement from C$5,000,000 to C$5,500,000. The company plans to issue up to 55,000,000 common shares at $0.10 per share.

Upon completion and combined with ongoing debt restructuring, the total outstanding shares will reach approximately 155,000,000. The proceeds will be used for short-term loan repayment and working capital. The company may pay finders' fees in cash, shares, or both.

Additionally, Organto has granted 1,300,000 stock options to officers and directors at $0.12 per share with a five-year term, and 150,000 restricted stock units with a three-year term to certain directors.

Positive

• Successful increase in private placement financing by C$500,000
• Debt restructuring initiatives in progress
• Funds secured for working capital and debt repayment

Negative

• Significant shareholder dilution with 55,000,000 new shares being issued
• Additional dilution from potential finders' fees paid in shares
• Share issuance price of $0.10 represents a discount to option grant price of $0.12

VANCOUVER, BC AND BREDA, THE NETHERLANDS / ACCESS Newswire / April 1, 2025 / Organto Foods Inc. (TSX-V:OGO)(OTC PINK:OGOFF) ("Organto" or the "Company") today announced its plan to increase the size of its recently announced non brokered private placement (see news release dated March 20, 2025) from C$5,000,000 to up to $5,500,000 (the "Private Placement").

Private Placement

The Company now proposes to conduct a non-brokered private placement of up to 55,000,000 common shares of the Company at the price of $0.10 per share for gross proceeds of up to C$5,500,000. When combined with other ongoing debt restructuring activities, the Company expects to have approximately 155,000,000 shares outstanding once completed.

The Company may pay finders' fees on the gross proceeds raised through the Private Placement in cash or shares or a combination thereof. The net proceeds from the Private Placement will be used for repayment of short-term loans and to fund general working capital.

Certain directors and officers of the Company may acquire securities under the Private Placement. Any such participation would be considered to be a "related party transaction" as defined under Multilateral Instrument 61-101 ("MI 61-101"). The transaction will be exempt from the formal valuation and minority shareholder approval requirements of MI 61-101 as neither the fair market value of any shares issued to, or the consideration paid by such persons will exceed 25% of the Company's market capitalization.

Completion of the Private Placement will be subject to the prior approval of the TSX Venture Exchange as well as all other requisite corporate, regulatory and security holder approvals, as applicable. Further, all securities issued pursuant to the Private Placement will be subject to a minimum hold period of four months and one day from their date of issuance.

Grant of Stock Options and Restricted Share Units

The Company also announces that it has granted a total of 1,300,000 stock options to certain officers and directors as per the terms of the Company's Share Option Plan. The options were granted at an exercise price of $0.12 per share and have a term of five years. 700,000 options will vest 20% immediately and 20% on each anniversary thereafter while 600,000 options will vest 25% immediately and 25% every six months thereafter. In addition, 150,000 restricted stock units were issued to certain directors of the Company as per the terms of the Company's Restricted Share Unit Plan. The restricted share units have a term of 3 years and will vest one-third after one-year and one-third every six months thereafter.

ON BEHALF OF THE BOARD

Steve Bromley
Chairman and CEO

For more information, contact:

Investor Relations
John Rathwell, Senior Vice President, Investor Relations & Corporate Development
647 629 0018
info@organto.com

ABOUT ORGANTO

Organto is a leading provider of branded, private label, and distributed organic and non-GMO fruit and vegetable products using a strategic asset-lighter business model to serve a growing socially responsible and health-conscious consumers. Organto's business model is rooted in its commitment to sustainable business practices focused on environmental responsibility and a commitment to the communities where it operates, its people, and its shareholders.

FORWARD LOOKING STATEMENTS

This news release may include certain forward-looking information and statements, as defined by law, including without limitation, Canadian securities laws and the "safe harbor" provisions of the US Private Securities Litigation Reform Act ("forward-looking statements"). In particular, and without limitation, this news release contains forward-looking statements respecting the Company's proposed private placement and debt restructuring activities. Forward-looking statements are based on a number of assumptions that may prove to be incorrect, including, without limitation, the assumption that the Company will be able to complete its planned private placement and debt restructuring activities in a timely manner. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements. Factors that could cause actual results to differ materially from those anticipated in forward-looking statements in this news release include, among others, uncertainty regarding the outcome of negotiations with the Company's creditors; regulatory risks; risks related to market volatility and economic conditions; risks related to unforeseen delays; and risks that necessary financing will be unavailable when needed. For further information on these and other risks and uncertainties that may affect the Company's business, see the "Risks and Uncertainties" and "Forward-Looking Statements" sections of the Company's annual and interim management's discussion and analysis filings with the Canadian securities regulators, which are available under the Company's profile at www.sedarplus.ca. Except as required by law, Organto does not assume any obligation to release publicly any revisions to forward-looking statements contained in this news release to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this news release.

SOURCE: Organto Foods, Inc.

View the original press release on ACCESS Newswire

FAQ

What is the size of Organto Foods' (OGOFF) increased private placement financing?

Organto Foods has increased its private placement financing from C$5,000,000 to C$5,500,000, offering 55,000,000 common shares at $0.10 per share.

How many shares will Organto Foods (OGOFF) have outstanding after the private placement?

After completing the private placement and debt restructuring, Organto Foods expects to have approximately 155,000,000 shares outstanding.

What will Organto Foods (OGOFF) use the private placement proceeds for?

The net proceeds will be used for repayment of short-term loans and to fund general working capital.

How many stock options and RSUs did Organto Foods (OGOFF) grant in April 2025?

Organto Foods granted 1,300,000 stock options at $0.12 per share and 150,000 restricted stock units to officers and directors.

What is the holding period for shares issued in Organto Foods' (OGOFF) private placement?

All securities issued in the private placement will have a minimum hold period of four months and one day from their date of issuance.