WeedMD Inc (CVE:WMD) (OTCMKTS:WDDMF) has closed its previously announced convertible debenture offering, netting more than $13.1 million in proceeds.
The company sold convertible debenture units for $1,000 each in an offering led by Mackie Research Capital Corporation, according to a statement released Wednesday. The offering was originally worth $12 million, but the underwriters took advantage of a 15% over-allotment option to purchase another $1.15 million worth of units.
The company said it plans to use the proceeds to buy new equipment, retrofit its Aylmer Facility and build an outdoor processing facility at its Strathroy operations, among other things.
As previously announced, each unit contains a debenture with an 8.5% interest rate and 625 share purchase warrants, exercisable at a price of $1.80 per share.
The principal of each debenture can be converted into common shares after 36 months. Should WeedMD shares trade above $3.60 for 20 days in a row, that timeline could be accelerated.
WeedMD paid a cash commission of 6% to the underwriters of the deal and issued 491,812 non-transferrable broker warrants, which are exercisable at a price of $1.60 per share.
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