Earth Alive Issues Convertible Debenture in the Principal Amount of $667,000

MONTREAL, Sept. 12, 2018 (GLOBE NEWSWIRE) -- Earth Alive Clean Technologies Inc. (CSE: EAC) (“Earth Alive” or the “Corporation”) is pleased to announce that it has issued a secured convertible debenture (the “Debenture”) in the amount of $667,000 to Groupe Lune Rouge Inc. (as successor to Investissements Influx Anse Inc., the “Investor”), and 2,240,246 warrants (the “Warrant(s)”) as part of their final tranche investment of $1.5M in the Debenture financing.   Please refer to press release dated  October 11th, 2017  for full details of the Debenture financing, available at www.sedar.ca.

Micheal Warren, the Chief Executive Officer, stated: “We are happy to report that this final tranche from the Investor will enable Earth Alive to ramp up production to meet the demand created by our steadily growing sales,  such as the recent half million dollar microbial distribution agreement in China; execute our sales development strategy for the Dr MariJane line; as well as to support some of our programs such as “the clean fibre initiative.”             

The Debentures bear interest at a rate of 15% per annum, which will be payable, together with the principal, on the maturity date of October 11, 2019, subject to earlier optional conversion.  The Debenture holders have the right to convert, in whole or in part and at any time, the principal amount of the Debentures and accrued and unpaid interest thereon into common shares of the Corporation at a conversion price equal to $0.35, subject to adjustments to be made in accordance with applicable anti-dilution provisions. The Warrants have an exercise price of $0.25, subject to adjustments to be made in accordance with applicable anti-dilution provisions, for a term of five (5) years.  All Debentures issued are secured by way of a hypothec on all of the Corporation’s intellectual property assets and rank pari passu with the then outstanding Debentures, which hypothec will be removed earlier upon the Corporation completing a third party financing in the amount of $3M.

The Investor, prior to this investment, held 21,228,572 common shares, Debentures in the principal amount of $833,000 (which can be converted into 2,643,149 common shares, as of this day, with accrued interest) and Warrants which can be exercised and converted into 3,107,133 common shares. Assuming the conversion of the outstanding securities, the Investor would have held  26,978,854 common shares, representing 24.06% of the shares outstanding.  Pursuant to this investment, the Investor holds Debentures in the aggregate principal amount of $1,500,000 which can be converted into 4,548,863 common shares (as of this day, with accrued interest) and Warrants to acquire 5,347,379 common shares.  Assuming conversion of all securities, this would represent 31,124,814 common shares, representing 25.5% of the outstanding common shares on a partially diluted basis.

The Investor entered into the transaction for investment purposes. Depending on market and other conditions, the Investor may from time to time in the future increase or decrease its ownership, control or direction over the shares or other securities of the Corporation, through market acquisitions, private agreements, public offerings or otherwise. However, the Investor has no pre-determined intention with respect to any of the foregoing, other than as described herein. A copy of the Investor’s related early warning report will be filed with the applicable securities commissions and will be made available on SEDAR at www.sedar.com, a copy of which may be obtained by contacting Catherine Vu, Secretary-Treasurer, Groupe Lune Rouge Inc., at (514) 723-7646 x8184.

Pursuant to Regulation 61-101 Respecting protection of minority security holders in special transactions, this transaction constitutes a "related party transaction". However, the Corporation is exempt from obtaining minority shareholder approval and a formal valuation as the fair market value of the consideration for the transaction does not exceed 25% of the issuer’s market capitalization.

Any and all securities issued pursuant to the proposed investment will be subject to a statutory hold period of four months and one day from the date of issuance. 

The CSE has neither approved nor disapproved the contents of this press release. The CSE does not accept responsibility for the adequacy or accuracy of this release.

Forward Looking Information

Except for statements of historical fact, this news release contains certain forward-looking statements within the meaning of applicable securities law. Forward-looking statements are frequently characterized by words such as “plan”, “expect”, “project”, “intend”, “believe”, “anticipate”, “estimate” and other similar words, or statements that certain events or conditions “may” occur. Although Earth Alive believes that the expectations reflected in the forward-looking statements are reasonable, there can be no assurance that such financing will be completed. Such forward-looking statements are subject to risks and uncertainties that may cause actual results, performance or developments to differ materially from those contained in the statements. Except as required under applicable securities legislation, Earth Alive undertakes no obligation to publicly update or revise forward-looking information, whether as a result of new information, future events or otherwise.

For additional company information, please visit: www.earthalivect.com