Emerging Advanced Materials Company

Advanced Mining and Exploration Company, Focused on Mine-to-Market Commercialization

Message: Gratomic Announces Closing of $1.5 Million Convertible Debenture and $750,000 Equity Financing

TORONTO, ON / ACCESSWIRE / June 12, 2020 / Gratomic Inc. ("GRAT" or the "Company") (TSXV:GRAT) (FRANKFURT:CB81) (WKN:A143MR) is pleased to announce that it has closed its non-brokered financing referred to in its May 12, 2020 Press Release and raised $2,250,000 (the "Offering"). First Republic Capital Corporation ("First Republic") acted as its exclusive lead finder in respect of the financing.

First Republic placed $1,500,000 aggregate principal amount of convertible debenture units ("Debenture Units"). The Debenture Units consist of 1,500 senior secured convertible debentures, with each Debenture Unit priced at $1,000 consisting of (a) one $1,000 face value convertible debenture, convertible at the option of the holder into common shares of the Company (a "Share") at $0.06 per Share for the first twelve (12) months from the closing of the Offering ("Closing Date"), and thereafter at $0.10 for a further six (6) months, which will bear interest at 10% per year, paid quarterly in cash, until maturity, being December 11, 2021 (a "Debenture Certificate"); and (b) 8,333 share purchase warrants ("Debenture Warrants") with each Debenture Warrant entitling the holder to purchase one additional Share at an exercise price of $0.10 per Share until December 11, 2021.

In addition, First Republic placed 12,499,996 working capital units ("WC Units") at a price of $0.06 per WC Unit for gross proceeds of $750,000. Each WC Unit comprises (a) one Share, and (b) one Share purchase warrant (an "WC Warrant"). Each WC Warrant entitles the holder to acquire one (1) Share (a "WC Warrant Share") at $0.10 per WC Warrant Share until June 11, 2022. The Debenture Units and the WC Units are collectively referred to as the ("Units").

"We are thrilled to have fully filled our latest Private Placement. We thank our valued shareholders for their continued support in our efforts." ~ Arno Brand, President & CEO.

The Company also wishes to announce that it closed the previously announced debt settlements aggregating $267,004.85 of debt for the issuance of an aggregate of 4,450,079 Shares at a price of $0.06 per Share including an aggregate $149,606.75 of debt owed to arm's length parties, one director and two entities related to insiders of the Company, for the issuance of 2,493,444 Shares.

The Company paid an aggregate of $180,000 in cash compensation to First Republic (as to $169,960) Richardson GMP (as to $5600) and Hampton Securities (as to $4440). As additional compensation, the Company issued 2,000,000 compensation debenture warrants ("Compensation Debenture Warrants") to First Republic (as to 1,832,667), Richardson GMP (as to 93,333) and Hampton Securities (as to 74,000) and 1,000,000 compensation unit warrants ("Compensation Unit Warrants") to First Republic. Each Compensation Debenture Warrant is exercisable at $0.06 until June 11, 2022 to acquire one Share and one half of one Debenture Warrant. Each Compensation Unit Warrant is exercisable at $0.06 until June 11, 2022 to acquire one WC Unit.

All securities issued are subject to a statutory hold period expiring on October 12, 2020.

The transaction is subject to a number of standard post-closing conditions. In the event of default or upon maturity of the Debenture Certificates, the Debenture Certificates will bear interest at the rate of 18% per annum. The Company will have the right to prepay or redeem a part or the entire principal amount of the Debenture Certificates at any time by providing a minimum of 30 days and a maximum of 60 days of redemption notice prior to the redemption date.

The Company's obligations under the Debenture Certificates will be secured by substantially all of the Company's assets, including a pledge of the shares of the Company's subsidiaries to the debenture holders as security. Any income generated from the sale of graphite from the Company's Aukam Graphite Mine will first be allocated to repay the Debenture Certificates. The Debenture Units are subject to standard anti-dilution adjustments, change of control and other provisions applicable to a secured convertible debenture.

The insider debt settlements are exempt from the valuation and minority shareholder approval requirements of Multilateral Instrument 61-101 ("MI 61-101") by virtue of the exemptions contained in sections 5.5(a) and 5.7(1)(a) of MI 61-101 in that the fair market value of the consideration for the securities of the Company to be issued to insiders does not exceed 25% of its market capitalization.

About Gratomic Inc.

Gratomic is an advanced materials company focused on mine to market commercialization of graphite products most notably high value graphene-based components for a range of mass market products. We have a Joint Venture collaborating with Perpetuus Carbon Technology, a leading European manufacturer of graphenes, to use Aukam graphite to manufacture graphene products for commercialization on an industrial scale. The Company is listed on the TSX Venture Exchange under the symbol GRAT.

For more information: visit the website at www.gratomic.ca or contact:

Arno Brand at [email protected] or 416 561-4095

"Neither 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 release."

FORWARD LOOKING STATEMENTS: This press release contains forward-looking statements, which relate to future events or future performance and reflect management's current expectations and assumptions. Such forward-looking statements reflect management's current beliefs and are based on assumptions made by and information currently available to the Company. Investors are cautioned that these forward-looking statements are neither promises nor guarantees and are subject to risks and uncertainties that may cause future results to differ materially from those expected. These forward-looking statements are made as of the date hereof and, except as required under applicable securities legislation, the Company does not assume any obligation to update or revise them to reflect new events or circumstances. All of the forward-looking statements made in this press release are qualified by these cautionary statements and by those made in our filings with SEDAR in Canada (available at www.sedar.com).

SOURCE: Gratomic Inc.

New Message
Please login to post a reply