On April 20, 2023 Sirona Biochem Corp. (TSX-V: SBM) (Frankfurt: ZSB) (Xetra: ZSB) (the "Company") reported that it has closed an oversubscribed, non-brokered convertible debenture for gross proceeds of $1,563,600 (Press release, Sirona Biochem, APR 20, 2023, View Source [SID1234630387]). The private placement consists of 1,563 Debenture units, (the "Debenture Units") at a price of $1,000 per Debenture Unit.

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Dr. Howard Verrico, CEO, subscribed to $500,000 of Debenture Units. Dr. Verrico’s participation is a "related party transaction" within the meaning of Multilateral Instrument 61-101 Protection of Minority Security Holders in Special Transactions. The Company relied on the exemptions from the formal valuation and minority shareholder-approval requirements of MI 61-101 in respect of related party participation in the Offering. The MI 61-101 exemptions are available as the fair market value of the Debenture Units, and the fair market value of the consideration for the Debenture Units, insofar as it involves Dr. Verrico and other interested parties, did not exceed 25% of the Company’s market capitalization.

"Although we are in a challenging market, I am confident the value of our platform technology will be recognized as we advance our diverse pipeline. It is my intention to support Sirona, as needed, both financially and by working with our team to make Sirona a commercial success. We appreciate the contribution of the long-term shareholders in this financing who share my vision", reports Dr. Howard Verrico.

Approximately 1/3 of the net proceeds from the Offering will be used for general corporate purposes, and the remainder of the proceeds will used for research and development expenses (including but not limited to, laboratory staff salaries, laboratory materials and intellectual property costs).

Each Debenture Unit has a face value of (the "Face Value") of $1,120, consisting of $1,000 in principal (the "Principal") and $120 in prepaid interest (the "Prepaid Interest"). The Principal of the Debenture Units will accrue interest at a rate of 12% per annum, which accrued interest ("Accrued Interest") will be paid semi-annually, in arrears. The Company will pay the Prepaid Interest and Accrued Interest in cash or, subject to TSX Venture Exchange ("TSXV") acceptance, may elect to satisfy payment in kind by issuing Shares ("Interest Shares"). In the event of payment in kind, the number of Interest Shares due will be calculated using a conversion price (the "Interest Conversion Price") equal to, subject to acceptance by the TSXV, the maximum Discounted Market Price (as defined in TSXV policies) on the applicable payment due date.

The holder may, at its option, convert in full or in part, the Principal at any time prior to April 20, 2026 (the "Maturity Date") into units (the "Units") of the Company at $0.10 per Unit (the "Conversion Price"). Upon conversion of the Principal, the Company will pay Prepaid Interest and unpaid Accrued Interest in cash or, subject to acceptance by the TSXV, in Interest Shares issued at the Interest Conversion Price.

Each Unit consists of one Share and one non-transferable share purchase warrant (a "Warrant"). Each Warrant is exercisable by the holder thereof to purchase one Share (a "Warrant Share") at an exercise price of $0.15 at any time prior to the Maturity Date.

The Company shall have the right to redeem the Convertible Debentures prior to the Maturity Date at any time after 6 months from the issue date, by paying holders in cash the Face Value of the Convertible Debentures, together with all Prepaid and Accrued Interest and a redemption penalty payment of 8% of the Face Value. The Company shall give the holders 30 business days’ notice (the "Redemption Notice") to do so. On receipt of a Redemption Notice, a holder may elect to convert all or part of the Principal of the Convertible Debenture into Units at the Conversion Price. All Prepaid and Accrued Interest in respect of the Principal amount so converted shall be, at the election of the holder, either paid in cash or, subject to acceptance by the TSXV, converted into Shares at the Interest Conversion Price, by giving the Company notice (the "Conversion Notice") within 10 business days of receipt of the Redemption Notice.

The Company compensated finder, PI Financial Corp. (the "Finder"), by way of cash fees of $12,500 and 125,000 warrants (the "Finder’s Warrants"). Each Finder’s Warrant entitles the
Finder to acquire common shares of the Company (each, a "Finder’s Warrant Share") at $0.15 per Finder’s Warrant Share for a period of 36 months from the date of issuance.