Organigram Invests in U.S. Based Open Book Extracts Representing Inaugural Jupiter Investment
26 März 2024 - 6:36PM
Business Wire
North Carolina-based Open Book Extracts is a
leading ingredient provider, product formulator and manufacturer of
hemp-derived extracts and products.
Organigram Holdings Inc. (NASDAQ: OGI) (TSX: OGI), (the
“Company” or “Organigram”) is pleased to announce a US $2 million
minority investment in Steady State LLC (d/b/a Open Book Extracts)
(“OBX”) in the form of a convertible note.
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Based in Roxboro within North Carolina’s “Research Triangle,”
OBX specializes in legal cannabinoid ingredient production and
serves as a one-stop formulation and finished goods manufacturer,
simplifying its clients’ supply chains.
“We are extremely excited to make our first Jupiter pool
investment in Open Book Extracts, a company that we’ve had on our
radar for quite some time,” said Paolo De Luca, Chief Strategy
Officer of Organigram. “OBX has a scalable platform, differentiated
products, and a great team, all of which support its tremendous
access to the U.S. market and leadership in the fast-growing hemp
derivatives category,” he concluded.
“Organigram has consistently proven itself to be one of Canada’s
leading licensed cannabis producers and has growing international
ambitions which is why we are so eager to have them as an investor
in OBX,” said OBX co-founder and CEO David Neundorfer. “We are
pleased to receive the investment from Organigram, who share our
commitment to upholding the highest standards of product quality,
and we look forward to helping the company launch hemp-derived
products in the U.S. over time,” added Oscar Hackett, co-founder,
President, and CFO.
Strategic Rationale of the Investment
- The investment in OBX provides a further footprint in the U.S,
which was a strategic priority set out in the Jupiter investment
strategy.
- OBX is a professional, quality-led company that is growing
quickly and is uniquely positioned to leverage the expanding legal
hemp derivatives market.
- Through its investment in OBX, Organigram will gain valuable
insights into the U.S. market and its consumers. In time,
Organigram plans to work with OBX to explore potential product
launches in the U.S.
- OBX and Organigram are currently discussing an opportunity for
OBX to serve as a collaborative research partner for efficacy
testing, technology development, and formulation sciences.
- OBX is nearing completion of its EU GMP certification, which
will create further international collaboration opportunities
between OBX and Organigram.
Select Convertible Note Particulars
- Organigram’s US $2 million subordinate secured convertible note
instrument (the “Note”) is part of a larger funding round totaling
~US $15 million. The most recent investors include a fund managed
by KEY Investment Partners and the Lago Innovation Fund. Existing
investors of OBX include BT DE Investments Inc., a subsidiary of
British American Tobacco plc. (BAT).
- The Note matures on October 16, 2026, unless converted
beforehand into equity of OBX.
- If OBX completes a future equity raise of at least US $5
million, the Note will, subject to certain conditions, convert into
equity at a 20% discount to the price of that financing round.
- The Note is secured by a general security charge over OBX’s
assets and is subordinate only to one security holder.
- Funds will be used for general corporate purposes.
- As part of the convertible note subscription, Organigram will
be granted one observer seat on the OBX board.
About Organigram Holdings Inc.
Organigram Holdings Inc. is a NASDAQ Global Select Market and
TSX listed company whose wholly owned subsidiaries include
Organigram Inc., a licensed producer of cannabis, cannabis-derived
products and cannabis infused edibles in Canada.
Organigram is focused on producing high-quality cannabis for
patients and adult recreational consumers, as well as developing
international business partnerships to extend the Company’s global
footprint. Organigram has also developed and acquired a portfolio
of adult-use recreational cannabis brands, including Edison, Holy
Mountain, Big Bag O’ Buds, SHRED, SHRED’ems, Monjour, Laurentian,
Tremblant Cannabis and Trailblazer. Organigram operates facilities
in Moncton, New Brunswick and Lac-Supérieur, Quebec, with a
dedicated edibles manufacturing facility in Winnipeg, Manitoba. The
Company is regulated by the Cannabis Act and the Cannabis
Regulations (Canada).
About Open Book Extracts
Headquartered in Roxboro, N.C., Open Book Extracts is an NSF
cGMP and ISO 9001-certified manufacturer of premium hemp-based
cannabinoid products, aiming to be the industry’s true north by
delivering premium products, exceptional service, and
industry-leading transparency. With a state-of-the-art extraction
campus near North Carolina’s Research Triangle, proprietary
refinement and conversion methods backed by a growing IP portfolio,
and a team of experienced scientists and seasoned business leaders,
OBX is the trusted partner for global brands seeking to enter the
marketplace.
For more information, visit https://openbookextracts.com.
Forward-Looking Information
This news release contains forward-looking information. Often,
but not always, forward-looking information can be identified by
the use of words such as “plans”, “expects”, “estimates”,
“intends”, “anticipates”, “believes” or variations of such words
and phrases or state that certain actions, events, or results
“may”, “could”, “would”, “might” or “will” be taken, occur or be
achieved. Forward-looking information involves known and unknown
risks, uncertainties and other factors that may cause actual
results, events, performance or achievements of Organigram to
differ materially from current expectations or future results,
performance or achievements expressed or implied by the
forward-looking information contained in this news release. Risks,
uncertainties and other factors involved with forward-looking
information could cause actual events, results, performance,
prospects and opportunities to differ materially from those
expressed or implied by such forward-looking information include
changes to market, legal and regulatory conditions, and factors and
risks as disclosed in the Company’s most recent annual information
form, management’s discussion and analysis and other Company
documents filed from time to time on SEDAR (see www.sedar.com) and
filed or furnished to the Securities and Exchange Commission on
EDGAR (see www.sec.gov). Readers are cautioned not to place undue
reliance on these forward-looking statements, which speak only as
of the date of this press release. Although the Company believes
that the assumptions and factors used in preparing the
forward-looking information in this news release are reasonable,
undue reliance should not be placed on such information and no
assurance can be given that such events will occur in the disclosed
time frames or at all. The forward-looking information included in
this news release are made as of the date of this news release and
the Company disclaims any intention or obligation, except to the
extent required by law, to update or revise any forward-looking
information, whether as a result of new information, future events
or otherwise.
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version on businesswire.com: https://www.businesswire.com/news/home/20240326681362/en/
For Media enquiries: Megan McCrae Senior Vice
President, Global Brands and Corporate Affairs
megan.mccrae@organigram.ca Organigram For Investor
enquiries: Max Schwartz Director of Investor Relations
max.schwartz@organigram.ca Organigram
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