QuickCool AB (Publ.) Proposes to become a holding company with the new direction of investing in cannabis and alternative medicine that also provides financing for the development of QuickCool® SYSTEM
QuickCool AB (Publ) ("QuickCool") The Board of directors proposes that the existing QuickCool company be transformed into a holding structure to invest in cannabis and other alternative medical markets as well as to, in a separate new subsidiary, continue to develop QuickCool® SYSTEM. The change provides a financing solution for acquisitions in medical cannabis, as well as for the development of QuickCool® SYSTEM.
The board of directors proposes that the name of the company, as a consequence of the change in business, will be changed to Bio-Med Cannabis Europe AB and that QuickCool becomes a significant player in the market for cannabis for medical applications by investing in the entire value chain of the cannabis industry.
The Board therefore proposes that the existing QuickCool company be transformed into a holding structure to invest in cannabis and other alternative medical markets and to continue, in a separate new subsidiary, to develop the current QuickCool® SYSTEM.
The Board considers that the new business is a unique investment opportunity for current and future shareholders in QuickCool, as there are few diversified investment platforms on the market for cannabis for medical use on the European securities exchanges. The change in operating direction will require that QuickCool applies to be relisted at Spotlight Stock Market.
The board proposes a change in the company's operations to the following: "the Company shall undertake investments, production and sales in the markets for the medical use of cannabis and alternative medicine as well as the development, production and sale of medical equipment and other herewith compatible activities".
The company has received a Term-Sheet containing the main content of a financing agreement from European High Growth Opportunities Securitization Fund ("EHGO"), regarding a financing solution based on the issuing of convertible debentures and warrants. The financing solution suggests that, during a 36-month period, the company can obtain a total capital contribution of 600 MSEK. In connection with the conclusion of the contract, the company shall release warrants of 20 MSEK.
QuickCool has negotiated the terms of the financing agreement in order to ensure the financing of the company's current and proposed future direction. The funding is estimated to provide QuickCool with capital over the next three (3) years in order to be able to execute the implementation of both the new business direction, related to investments in the market for the medical use of cannabis and other alternative treatment methods, as well as the continuous activities to achieve the CE-mark for the QuickCool® SYSTEM. The financing of the fully owned subsidiary is to be provided (subject to the fulfilment of certain conditions) for the next twelve (12) to fifteen (15) months, equivalent to a total investment of between 13-16 MSEK. The intention is to examine the opportunities for the fully owned subsidiary holding the QuickCool® SYSTEM business once CE-mark has been received, including potentially a disposition to a third party or to the public via a separate IPO process. 3
The financing would run for a period of 36 months. During this period, the company is able to receive SEK 600 million through the issuance of convertible debentures and associated warrants. It is equivalent to a total of 300 tranches of SEK 2 million each, of which EHGO obtains the right to call-off 150 tranches.
When the final agreement is signed, the company shall issue warrants related to new shares to EHGO, without extra charge, which, if exercised, will bring another 20 MSEK to the company. The convertible debentures must be converted into shares within twelve (12) months from the date of issue. The warrants must be exercised within five (5) years from the time of issue.
Conversion rate for the convertible debentures and subscription price for the warrants is determined based on a pricing period. The convertible debentures are required to be converted twelve (12) months after issue. The conversion rate is equivalent to 99 percent of the lowest price during the price period prior to receipt of a conversion request or at the end of the twelve (12) month period. For the warrants, the subscription price is defined as 300 per cent of the price per share when the contract is concluded. The warrants can only be transferred from EHGO to its affiliates.
EHGO undertakes to transfer 50 percent of the warrants, to which the commitment relates, to current shareholders in the company.
European High Growth Opportunities Securitization Fund is an institutional investment company based in Luxembourg which focuses on financing highly innovative companies in Europe that are evaluated to be significantly undervalued. EHGO has supported QuickCool with financial services in the past.
As per the rules of the Spotlight Stock Market, QuickCool will have to request that Spotlight approve the new business of QuickCool. Accordingly, a new listing application will be required to be filed with Spotlight Stock Market.
As a first step in regards to the establishment of the new business area in QuickCool, is the acquisition of 6 500 000 shares, equivalent to 8.51% in HTC purEnergy Inc. ("HTC") from two (2) affiliated companies of Biovation Sciences LTD. ("Biovation"). HTC is a leading producer of CBD (non-THC) cannabis with its headquarters at #002, 2305 Victoria Avenue, Regina, SK, S4P 0s7, Canada. Each of the two acquisitions are with respect to 3 250 000 shares in HTC. The transactions would be carried out during the first half of December, but no later than 31 January 2020. The transaction value amounts to about 20 MSEK and means that the company pays a premium of 20% for the shares at the specified value at the time of execution.
Quickcool intends to enter into agreements with Biovation regarding investment advice and support for investments in additional operations. The background to this is that Biovation has access to extensive experience in the relevant markets and stakeholders, which Biovation would be willing to make available to the company.
Furthermore, Biovation is a related company to QuickCool which means that the acquisitions of the shares in HTC as well as the agreement regarding investment advice, must be subject to and approved by the shareholders at a general meeting in accordance with The Swedish Securities Council’s statement 2019:25 and 16a chapter in the Swedish Companies Act (2005:551).
A notice to an extraordinary general meeting will be published during the day. Further the board's complete proposals and information under the Swedish Companies Act will be published on our website no later than 19 November 2019.
For more information, please contact:
Fredrik Radencrantz, VD
Telefon: 046-286 38 40
E-post: fredrik.radencrantz@quickcool.se
This information is such that QuickCool AB is required to make public in accordance with the EU’s market abuse regulation (MAR). The information was made publicly available by the Company’s contact person on 03 November, 2019.
Quickcool is a Swedish medical technology company, whose business concept is to save lives and prevent brain damage in acute ischemia (Inadequate blood supply to the brain) by developing and providing a unique and globally patented cooling system, the Quickcool SYSTEM. Quickcool is active in the fast-growing market, Targeted Temperature Management (TTM), for brain-protective cooling treatment of patients with e.g. acute cardiac arrest and stroke. QuickCool’s solution protects the brain by cooling in the nasal cavity and thus takes advantage of the innate heat exchanger in the nose. QuickCool’s Intranasal method offers gentle and uninterrupted cooling treatment for sedated patients. Quickcool is listed on Spotlight Stock Market and conducts its business at Ideon Science Park in Lund. For more Information, please refer to www.quickcool.se
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