ABcann Global Corporation (TSX-V:ABCN) (“
ABcann”
or the “
Company”) announced today that, further to
its news release of December 12, 2017, it has completed the
acquisition of Harvest Medicine Inc. (“
HMed” or
“
Harvest Medicine”) pursuant to the terms of a
share purchase agreement dated January 31, 2018 (the
“
Purchase Agreement”), in
consideration for, among other things, a cash payment of $1.5
million; the issuance of 1,056,338 common shares in the capital of
the Company (each, a “
Share”); and additional
post-closing consideration if certain performance milestones, which
include certain patient, revenue and profitability metrics, are
achieved (the “
Transaction”).
As a result of the completion of the
Transaction, Harvest Medicine has become a wholly-owned subsidiary
of the Company but will maintain its commitment to being an open
platform that enables patients to register with the Licensed
Producer of their choice. To that end, ABcann has committed to
invest $1.5 million to facilitate the development of new Harvest
Medicine clinics and strategic patient-focused initiatives. ABcann
has also entered into an employment agreement with Shekhar Parmar,
the Chief Executive Officer of Harvest Medicine, pursuant to which
he has been appointed Chief Strategy Officer of ABcann and will
continue to act as CEO of HMed.
“The acquisition of Harvest Medicine represents
further progress toward our goal of becoming a vertically
integrated medical cannabis company,” said Barry Fishman, Chief
Executive Officer of ABcann. “It is one of the fastest-growing
medical cannabis clinics in Canada, with an aggressive expansion
plan and a patient-focused approach that is aligned with ABcann’s
philosophy of quality and innovation. We look forward to working
with Shekhar to integrate Harvest Medicine into ABcann as we
continue to execute on our strategic vision.”
“This transaction will allow Harvest Medicine to
rapidly accelerate our expansion plans and bring our highly rated,
patient-centric approach to patients in need. I am also
personally looking forward to joining the executive team at ABcann
and contributing to the continued dynamic growth of the company,”
commented Mr. Parmar, Chief Executive Officer of Harvest
Medicine.
In accordance with the terms of the Purchase
Agreement, the Shares issued as partial consideration have been
deposited into escrow pursuant to the terms of an escrow agreement
dated January 31, 2018, and will be released in equal quarterly
amounts over the three year period following the closing of the
Transaction.
In connection with Mr. Parmar’s appointment as
Chief Strategy Officer, the Company has granted Mr. Parmar 300,000
stock options, each of which is exercisable into one Share until
January 31, 2023 at a price of $1.42 per Share, being the closing
price per share on the TSX Venture Exchange on the date prior to
the announcement of the binding letter agreement between the
parties with respect to the acquisition of HMed. The options will
vest monthly over 36 months from the date of grant.
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 9,700 active patients in under
12 months, and now acquiring over 1,300 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 is expected to 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: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
pharmaceutical-grade cannabis products.
The Company is expanding its cultivation
capacity and pursuing partnerships 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
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
expected growth plans of ABcann and HMed and the timing of same;
and (ii) the expected benefits to be realized by ABcann and/or HMed
as a result of the Transaction. 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. 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 annual information
form dated January 24, 2018, 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.
ABcann disclaims any intention or obligation, to update or revise
any forward-looking statements, whether as a result of new
information, future events or otherwise, except as expressly
required by applicable law.
For further information, please contact:
Barry Fishman (CEO and Director) at barry.fishman@abcannglobal.com
Michael Bumby (CFO) at michael.bumby@abcannglobal.com
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