WeedMD Inc. (TSX-V:WMD) (OTCQX:WDDMF) (FSE:4WE)
(“
WeedMD” or the “
Company”), a
federally-licensed producer and distributor of medical-grade
cannabis, and Starseed Holdings Inc. (“
Starseed”),
a medically-focused, federally-licensed cannabis company, are
pleased to announce the closing of the previously announced
acquisition of Starseed Holdings by WeedMD (the
“
Acquisition”).
Concurrent with the closing, WeedMD also
completed the previously announced private placement of
subscription receipts (the “Subscription
Receipts”) with the LiUNA Pension Fund of Central and
Eastern Canada (“LPF”), for aggregate gross
proceeds of $25 million. The issue price of each Subscription
Receipt is $1.0832, and each Subscription Receipt shall be
automatically exchangeable into one WeedMD common share upon its
shareholders approving certain matters associated with the
financing at a meeting scheduled for February 4, 2020.
“We officially welcome the Starseed team to the
WeedMD family which together will kick-off 2020 as a very
compelling, vertically-integrated cannabis company that will
execute across the entire value chain,” said Keith Merker, CEO of
WeedMD. “Starseed’s unique medical distribution platform
complements WeedMD’s high-quality cultivation and processing
platform. This partnership, along with the $25 million strategic
equity investment by LPF, positions WeedMD and its shareholders
with a fortified balance sheet and one of the most captive medical
cannabis businesses in the country as we enter the new year.”
Management Team
Following today’s closing, Starseed’s management
team, which brings extensive medical, operating, and financial
expertise, in addition to strong industry and client relationships,
integrates into WeedMD’s senior leadership team as follows:
- Keith Merker, CEO (maintains role)
- Angelo Tsebelis, formerly President of Starseed, assumes the
role of President of WeedMD
- Nichola Thompson, CFO (maintains role)
- Stephen Ng, formerly CFO of Starseed, is appointed to Chief
Strategy Officer of WeedMD
- Dr. Peter Blecher, formerly Chief Medical Officer of Starseed,
assumes the role of Chief Medical Officer of WeedMD
Additional information about WeedMD’s current
management team can be found here.
Board Directors
In addition to the Starseed leadership
appointments, WeedMD’s board of directors is now comprised of four
representatives from WeedMD and three representatives from
Starseed.
WeedMD is pleased to announce that seasoned
industry leader George Scorsis is appointed as Executive Chair of
its board of directors. For the last six months, Mr. Scorsis has
served as executive advisor to the WeedMD board and leadership team
and is widely recognized in the cannabis and beverage industries
for building, leading and managing high-performing management
teams.
WeedMD extends its gratitude to Michael Kraft
who has served as Chair of its board of directors since the
Company’s inception. As one of WeedMD’s co-founders, Mr. Kraft has
been integral to its growth and success over the years and we are
pleased he has accepted the role of strategic advisor to the board
which includes the existing WeedMD directors:
- Keith Merker, currently CEO of WeedMD
- Gail Paech, formerly Associate Deputy Minister, Ministry of
Health, Ontario
- Michael Pesner, previously on the board of SAQ (Société des
alcools du Québec), and KPMG executive leader
WeedMD is pleased to welcome three new board
directors from Starseed:
- Angelo Tsebelis, currently President of WeedMD
- G. Edmund King, former CEO and Chairman of CIBC Wood Gundy
- Dr. Hugh Scully, previously President of both the Ontario &
Canadian Medical Associations
Additional information about WeedMD’s current
board of directors can be found here.
The Company would also like to thank Rick
Moscone and Kevin McGovern who have elected to step down following
three years and one year of service, respectively.
Pursuant to the Acquisition, WeedMD acquired
100% of the issued and outstanding common shares of Starseed and in
exchange Starseed shareholders received a total of approximately
71.8 million common shares of WeedMD. Certain shareholders of
Starseed, holding approximately 49 million common shares of WeedMD,
have agreed to an 18-month lock-up and leak out agreement.
About WeedMD Inc.
WeedMD Inc. is the publicly-traded parent
company of WeedMD Rx Inc., a federally-licensed producer of
cannabis products for both the medical and adult-use markets. The
Company owns and operates a 158-acre state-of-the-art greenhouse,
outdoor and processing facility located in Strathroy, Ontario.
WeedMD also operates CX Industries Inc., a wholly-owned subsidiary
of WeedMD Inc., from the Company’s fully-licensed 26,000 sq. ft.
Aylmer, Ontario production facility which specializes in cannabis
extraction and processing. With the recent acquisition of Starseed
Medicinal Inc., a medical-centric licensed holder with operations
in Bowmanville, Ontario, WeedMD has expanded its multi-channeled
distribution strategy. Starseed’s industry-first, exclusive
partnership with LiUNA, the largest construction union in Canada,
along with other employers and union groups complements WeedMD’s
direct sales to medical patients. The Company maintains strategic
relationships across the seniors’ market and supply agreements with
Shoppers Drug Mart as well as six provincial distribution agencies
where its adult-use brands Color Cannabis and Saturday are
sold.
Follow WeedMD, Color Cannabis &
Starseed:
FacebookLinkedInTwitterInstagram Weed
MDInstagram Color CannabisInstagram Starseed
For further information, please
contact:
For Investor Inquiries:James
WilliamsDirector, Capital MarketsEmail: investor@weedmd.com
For Media Enquiries:Marianella
delaBarreraVP, Communications & Corporate AffairsTel:
416-897-6644Email: marianella@weedmd.com
To learn more, visit us at www.weedmd.com
Forward Looking
Information:
This press release contains “forward-looking
information” within the meaning of applicable Canadian securities
legislation which are based upon WeedMD’s current internal
expectations, estimates, projections, assumptions and beliefs and
views of future events. Forward-looking information can be
identified by the use of forward-looking terminology such as
“expect”, “likely”, “may”, “will”, “should”, “intend”,
“anticipate”, “potential”, “proposed”, “estimate” and other similar
words, including negative and grammatical variations thereof, or
statements that certain events or conditions “may”, “would” or
“will” happen, or by discussions of strategy.
The forward-looking information in this news
release is based upon the expectations, estimates, projections,
assumptions and views of future events which management believes to
be reasonable in the circumstances. Forward-looking information
includes estimates, plans, expectations, opinions, forecasts,
projections, targets, guidance or other statements that are not
statements of fact. Forward-looking information in this news
release include, but are not limited to, statements with respect to
internal expectations, expectations with respect to actual
production volumes, expectations for future growing capacity and
the completion of any capital project or expansions.
Forward-looking information necessarily involve known and unknown
risks, including, without limitation, risks associated with general
economic conditions; adverse industry events; loss of markets;
future legislative and regulatory developments; inability to access
sufficient capital from internal and external sources, and/or
inability to access sufficient capital on favourable terms; the
cannabis industry in Canada generally; the ability of WeedMD to
implement its business strategies; competition; crop failure; and
other risks.
Any forward-looking information speaks only as
of the date on which it is made, and, except as required by law,
WeedMD does not undertake any obligation to update or revise any
forward-looking information, whether as a result of new
information, future events or otherwise. New factors emerge from
time to time, and it is not possible for WeedMD to predict all such
factors. When considering this forward-looking information, readers
should keep in mind the risk factors and other cautionary
statements in WeedMD’s Annual Information Form dated June 21, 2019
(the “AIF”) and other disclosure documents of WeedMD filed with the
applicable Canadian securities regulatory authorities on SEDAR at
www.sedar.com. The risk factors and other factors noted in the AIF
and other disclosure documents could cause actual events or results
to differ materially from those described in any forward-looking
information.
NEITHER THE 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
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