Organto Foods completes $8 million private placement financing

Organto Foods Inc. (TSXV:OGO)(OTCQB: OGOFF) completed a non-brokered private placement financing that raised $8.0 million in gross proceeds, according to a company statement.

The Vancouver-based organic food company issued 16,000,000 units at $0.50 per unit. Each unit consists of one common share and one-half common share purchase warrant.

The warrants allow holders to purchase additional common shares at C$0.75 each for 18 months from the closing date. The company can accelerate the warrant expiry date to 30 days after announcing such acceleration if its common shares close at or above $1.00 for ten consecutive trading days on the TSX Venture Exchange.

Securities from the private placement are subject to a four-month-and-one-day hold period under Canadian securities laws, plus a 12-month contractual transfer restriction.

Organto will pay finder's fees totaling 7.5% of gross proceeds in cash ($600,000) plus 1,200,000 common share warrants exercisable at $0.50 per warrant for 18 months.

The company stated it intends to use net proceeds to expand its organic and fair-trade fruit and vegetable platform, develop its technology platform, support working capital requirements, and potentially repay short-term debt.

The financing remains subject to TSX Venture Exchange approval and other regulatory approvals.

"This financing strengthens our capital position and positions us to accelerate the expansion of our organic and fair-trade fruit and vegetable platform," said Steve Bromley, co-chair and chief executive officer, in the statement.

Organto operates as an integrated provider of branded, private label, and distributed organic and fair-trade fruit and vegetable products.

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