ABcann Global Corporation (TSXV:ABCN) (“ABcann” or
the “Company”) is pleased to announce that it has entered into a
binding letter of intent dated December 11, 2017 (the “LOI”) to
acquire (the “Acquisition”) all of the outstanding securities of
Harvest Medicine Inc. (“HMED” or “Harvest Medicine”). This
transaction unites the high-quality, precision growing focus of
ABcann with the high-quality, customized patient focus of HMED. As
Canada’s fastest growing medical cannabis clinic, Harvest Medicine
has educated and serviced over 8,500 active patients since opening
in February 2017.
“Harvest Medicine is a great partner for us, and
the Acquisition will be immediately accretive to our shareholders,”
said Barry Fishman, ABcann’s CEO. “Their professional,
patient-focused approach is aligned with ABcann’s philosophy of
quality and innovation. This represents one initial step of many as
we begin the execution of our aggressive growth strategy.”
Under the terms of the LOI, at the closing of
the Acquisition (the “Closing”), ABcann will:
- make a $1,500,000 cash payment (less amounts needed to settle
certain outstanding liabilities of HMED);
- issue 1,056,338 common shares in the capital of ABcann (each,
an “ABcann Share”) having an aggregate value of $1,500,000, based
on a deemed price of $1.42 per ABcann Share, which will be
deposited into escrow and released in equal quarterly amounts over
the three-year period following the Closing; and
- pay future consideration in the form of cash or ABcann Shares,
post-Closing, if certain performance milestones, which include
certain patient, revenue and profitability metrics, are
achieved.
ABcann has also committed to investing
$1,500,000 to enable HMED to execute its expansion plans and take
its proven recipe for delivering patient value to several new
clinics. Under the terms of the Acquisition, Harvest Medicine will
maintain its commitment to being an open platform, that enables
patients to register with the Licensed Producer of their
choice.
At the Closing, Harvest Medicine founder and
CEO, Shekhar Parmar, is expected to join ABcann’s executive team as
Chief Strategy Officer and remain CEO of HMED. Mr. Parmar, a lawyer
and entrepreneur, brings to ABcann extensive knowledge of the
medical cannabis market and a unique perspective on patient needs.
HMED has earned the trust of its active patient base of over 8,500
patients by providing unmatched focus on face-to-face patient
communication, service and education.
“Harvest Medicine was fortunate to have our
choice of partners to help us grow and take the steps required to
bring our patient-centric model to Canadians from coast-to-coast.
ABcann impressed us with their quality focus and entrepreneurial
culture. I look forward to joining ABcann’s executive team as Chief
Strategy Officer, and to continuing in the role of CEO of Harvest
Medicine as we scale-up our proven business model.”
The closing of the Acquisition is subject to
customary conditions, including the completion of satisfactory due
diligence, the execution of a definitive agreement, and the receipt
of applicable third party and regulatory approvals, including that
of the TSX Venture Exchange (the “TSXV”).
About Harvest Medicine:
Harvest Medicine is an education focused,
patient-centric, cannabis discovery center and clinic that has
received tremendous response from its patients. Growing to over
8,500 active patients in under 10 months, and now acquiring over
1,200 new patients monthly from a single location, HMED is one of
Canada’s most successful and fastest growing cannabis clinics.
Harvest Medicine is poised to expand its
successful and highly scalable location in Calgary across the
country. The first of these new clinics will open in Edmonton in
the spring of 2018 with other locations around the country being
evaluated. Using a highly trained team of medical doctors and Canna
Genius educators, Harvest Medicine provides a welcoming environment
that focuses on educating patients on the safe and effective use of
medical cannabis.
About ABcann Global:
ABcann holds production and sales licenses from
Health Canada. Its flagship facility in Napanee, Ontario contains
proprietary plant-growing technology, centred on its
specially designed, environmentally-controlled growing chambers.
This approach results in the production of pesticide-free,
pharmaceutical-grade cannabis products.
The Company is expanding its cultivation
capacity and pursuing partnership and product development
opportunities domestically, as well as in select international
markets, such as Germany, Australia and Israel.
ON BEHALF OF THE BOARD OF DIRECTORS
“Barry Fishman”
Barry Fishman CEO and Director
For further information, please contact:
- Barry Fishman (CEO and Director) at
barry.fishman@abcannglobal.com
- Aaron Keay (Director) at aaron@abcannglobal.com or
- Michael Bumby (CFO) at michael.bumby@abcannglobal.com
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.
Disclaimer for Forward-Looking Statements
This news release contains certain
“forward-looking statements” or “forward-looking information” as
contemplated by applicable Canadian securities law. Forward-looking
statements are frequently characterized by words such as “plan”,
“continue”, “expect”, “project”, “intend”, “believe”, “anticipate”,
“estimate”, “may”, “will”, “potential”, “proposed” and other
similar words, or information that certain events or conditions
“may” or “will” occur. They are only a prediction. Various
assumptions were used in drawing the conclusions or making the
projections contained in the forward-looking statements throughout
this news release. Forward-looking statements in this news release
include, but are not limited to, statements regarding: (i) the
terms of the proposed Acquisition, (ii) the expected growth plans
of ABcann and HMed; (iii) the consideration to be paid by ABcann in
connection with the Acquisition; (iv) the benefits to be realized
by ABcann and/or HMed as a result of the Acquisition; and (v) the
positions to be held by Mr. Parmar following the Closing. Such
statements are subject to risks and uncertainties that may cause
actual results, performance or developments to differ materially
from those contained in the forward-looking statements, including:
(i) that the Acquisition and/or Mr. Parmar’s appointment to the
ABcann executive team may not be approved by the TSXV or any other
applicable parties; (ii) that the Acquisition may not be completed
on the terms contemplated in the LOI or at all; (iii) that the
conditions necessary for the Closing to occur may not be satisfied
or waived; and (iv) other factors beyond the Company’s control. No
assurance can be given that any of the events anticipated by the
forward-looking statements will occur or, if they do occur, what
benefits the Company will obtain from them. Readers are urged to
consider these factors, and the more extensive risk factors
included in the Company’s filing statement dated March 31, 2017,
which is available on SEDAR, carefully in evaluating the
forward-looking statements, and are cautioned not to place undue
reliance on such forward-looking statements, which are qualified in
their entirety by these cautionary statements. Neither ABcann nor
HMED is under any obligation, and expressly disclaims any intention
or obligation, to update or revise any forward-looking information,
whether as a result of new information, future events or otherwise,
except as expressly required by applicable law.
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