SCHEDULE 13D
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1
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NAMES OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
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AUSTRALIS CAPITAL INC.
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2
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CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
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(a) [ ]
(b) [ ] Not applicable
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3
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SEC USE ONLY
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4
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SOURCE OF FUNDS (See Instructions)
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SC
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5
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CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(D) OR 2(E)
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Not applicable [ ]
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6
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CITIZENSHIP OR PLACE OF ORGANIZATION
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Canada
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NUMBER OF
SHARES
BENEFICIALLY
OWNED BY
EACH
REPORTING
PERSON
WITH
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7
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SOLE VOTING POWER
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27,782,719 shares of common stock. (1)
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8
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SHARED VOTING POWER
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Nil
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9
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SOLE DISPOSITIVE POWER
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27,782,719 shares of common stock. (1)
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10
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SHARED DISPOSITIVE POWER
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Nil
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11
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AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
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27,782,719 shares of common stock.
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12
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CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (See Instructions)
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Not applicable [ ]
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13
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PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
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26.5% (2)
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14
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TYPE OF REPORTING PERSON (See Instructions)
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CO
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Notes:
(1)These 27,782,719 common shares consist of (i) 24,873,628 shares of common stock held by the Reporting Person and (ii) 2,909,091 of the Issuer’s common stock issuable upon conversion of convertible debentures (the “Debentures”) in the aggregate principal amount of CAD$1,600,000. The Reporting Person has agreed to convert the Debentures on July 1, 2020.
(2)Based on 101,853,217 common shares of the Issuer's common stock issued and outstanding as of November 28, 2019.
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Item 1.Security and Issuer
This statement constitutes Amendment No. 5 to the Schedule 13D relating to the voting common stock, with a par value of CAD$0.0001, of Body and Mind Inc., a corporation organized under the laws of the State of Nevada (the "Issuer"), and hereby amends the Schedule 13D filed with the Securities and Exchange Commission on December 31, 2018 (the “Initial Schedule 13D”), as amended by: Amendment No. 1 filed with the Securities and Exchange Commission (“SEC”) on December 31, 2018; Amendment No. 2 filed with the SEC on February 6, 2019; Amendment No. 3 filed with the SEC on May 28, 2019; and Amendment No. 4 filed with the SEC on July 3, 2019.
The Issuer maintains its principal executive office at 750 – 1095 West Pender Street, Vancouver, British Columbia, Canada, V6E 2M6.
Item 2.Identity and Background
Name:
This statement is filed by Australis Capital Inc. (the "Reporting Person"). All decisions with respect to securities of the Issuer (including investments decisions with respect thereto and decisions relating to the voting thereof) are made by the board of directors of the Reporting Person.
Residence or Business Address:
376 East Warm Springs Road
Suite 190
Las Vegas, Nevada 89119
Present Principal Business or Occupation:
The Reporting Person operates businesses focused on the cannabis industry in the United States through its subsidiaries and other entities in which it holds interests. The Reporting Person’s business activities may include the acquisition of equity, debt or other securities of publicly traded or private companies or other entities, financing in exchange for predetermined royalties or distributions, and the acquisition of all or part of one or more businesses, portfolios or other assets.
Place of Organization or Citizenship:
Australis Capital Inc. is a corporation organized under the laws of the Province of Alberta, Canada.
Criminal Proceedings:
During the last five years, the Reporting Person has not been convicted in any criminal proceeding.
Civil Proceedings:
During the last five years, the Reporting Person has not been a party to any civil proceeding of a judicial or administrative body of competent jurisdiction where, as a result of such proceeding, there was or is a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws.
Item 3.Source and Amount of Funds or Other Considerations
On November 29, 2019, the Reporting Person transferred to Passport Technology Canada Ltd. (“Passport”) 5,000,000 shares of Common Stock (the “Common Shares”) of the Issuer in consideration for certain services and rights under a license, development and services agreement between the Reporting Person and Passport dated October 29, 2019 (the “Passport Agreement”).
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On November 29, 2019, the Reporting Person transferred to Astound Group Inc. (“Astound”) 5,000,000 Common Shares of the Issuer in consideration for certain services under a services agreement dated November 20, 2019 (the “Astound Agreement”).
Item 4.Purpose of Transaction
Passport’s parent company, Passport Technology Inc. (“Passport Technology”), is a leading developer of technology-based products and services for the highly regulated payments, gaming and financial services markets. Passport Technology's products include attended payment kiosks, cash access systems, server and web-based analytic technology, agnostic application management systems, and interactive content and services.
Pursuant to the Passport Agreement, Passport has agreed to adapt Passport Technology’s self-service platform to service the cannabis industry, undertake prototype development and ongoing product enhancements, and has granted to the Reporting Person exclusive software rights and exclusive use of vendor relationships at cost. The Passport Agreement contemplates an exclusive 10-year relationship between the parties. On November 29, 2019, the Reporting Person transferred to Passport 5,000,000 Common Shares as part of the consideration payable to Passport under the Passport Agreement.
Astound is a creative agency which provides services including brand strategy and development, retail design, tradeshow exhibit design and fabrication, and architectural fabrication. Pursuant to the Astound Agreement, Astound has agreed provide brand optimization services, assist the Reporting Person with expanding brand awareness, introduce new products for the Reporting Person’s existing brands and provide other marketing and development services for a period of three years.
As described in the Initial Schedule 13D, pursuant to an Investment Agreement between the Issuer and the Reporting Person dated October 30, 2018 (the “Investment Agreement”), for as long as the Reporting Person owns 10% of the issued and outstanding common shares of the Issuer, the Reporting Person will be entitled to nominate one person for election or appointment to the board of directors of the Issuer (the “Board”). If the Reporting Person exercises all of its warrants of the Issuer and converts all its debentures of the Issuer, the Reporting Person will be entitled to nominate a second person for election or appointment to the Board. For as long as the Reporting Person maintains at least 25% of the issued and outstanding common shares of the Issuer, the Reporting Person will be entitled to nominate two persons for election or appointment to the Board.
The Reporting Person reserves the right to formulate other plans or make other proposals, and take other actions with respect to its interest in the Issuer. Depending on market conditions and other factors, the Reporting Person may acquire or dispose of securities of the Issuer as the Reporting Person may deem appropriate, whether in open market purchases or sales, privately negotiated transactions or otherwise. The Reporting Person continues to evaluate numerous potential transactions and in connection therewith may exchange Common Shares for other assets or may sell Common Shares to increase its cash position. The Reporting Person may also reconsider and change its plans or proposals relating to the foregoing.
Except as otherwise disclosed herein, the Reporting Person has no current plans or proposals that relate to or would result in:
(a)the acquisition by any person of additional securities of the Issuer, or the disposition of securities of the Issuer;
(b)any extraordinary corporate transaction, such as a merger, reorganization or liquidation, involving the Issuer or any of its subsidiaries;
(c)a sale or transfer of a material amount of the assets of the Issuer or any of its subsidiaries;
(d)any change in the present board of directors or management of the Issuer, including any plans or proposals to change the number or term of directors or to fill any existing vacancies on the board;
(e)any material change in the present capitalization or dividend policy of the Issuer;
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(f)any other material change in the Issuer's business or corporate structure including, but not limited to, if the Issuer is a registered closed-end investment company, any plans or proposals to make any changes in its investment policy for which a vote is required by Section 13 of the United States Investment Company Act of 1940;
(g)changes in the Issuer's charter, bylaws or instruments corresponding thereto or other actions which may impede acquisition of control of the Issuer by any person;
(h)causing a class of securities of the Issuer to be delisted from a national securities exchange or to cease to be authorized to be quoted in an inter-dealer quotation system of a registered national securities association;
(i)a class of equity securities of the Issuer becoming eligible for termination of registration pursuant to Section 12(g)(4) of the Act; or
(j)any action similar to any of those enumerated above.
Item 5.Interest in Securities of the Issuer
The filing of this statement by the Reporting Person shall not be construed as an admission that the Reporting Person is, for the purposes of Section 13(d) or 13(g) of the Act, the beneficial owners of any securities covered by the statements herein.
(a)For the purposes of this statement, the Reporting Person is reporting herein that, as of November 29, 2019 the Reporting Person was the beneficial owner of 27,782,719 shares of the Issuer's common stock, representing approximately 26.5% of the Issuer's issued and outstanding common stock. These 27,782,719 shares consist of (i) 24,873,628 shares of common stock currently held by the Reporting Person and (ii) 2,909,091 shares of the common stock issuable upon conversion of the Debentures.
(b)For the purposes of this statement, the Reporting Person is reporting herein that, as of November 29, 2019 the Reporting Person had the sole power to vote or to direct the voting of, or to dispose or to direct the disposition of 27,782,719 shares of the Issuer's common stock, representing approximately 26.5% of the Issuer's common stock. These 27,782,719 shares consist of (i) 24,873,628 shares of common stock currently held by the Reporting Person and (ii) 2,909,091 shares of the common stock issuable upon conversion of the Debentures.
(c)As of the date hereof, and within the sixty day period prior thereto, no transactions involving the Issuer’s equity securities had been engaged in by the Reporting Person other than as disclosed herein.
(d)As of the date hereof, to the best knowledge and belief of the undersigned, except as otherwise reported herein, no person other than the Reporting Person had the right to receive or the power to direct the receipt of dividends from, or the proceeds from the sale of, the securities reported herein.
(e)Not applicable.
Item 6.Contracts, Arrangements, Understandings or Relationships with Respect to Securities of the Issuer
Pursuant to the terms of the Investment Agreement, the Reporting Person will have the right to participate in any future equity offerings of the Issuer to maintain an ownership interest in the Issuer equal to the percentage ownership prior to such an offering, provided that such ownership interest does not exceed 40% (the “Anti-Dilution Right”). Such participation right will expire at the time that the Reporting Person no longer holds 10% or more of the issued and outstanding common shares of the Issuer.
Pursuant to the terms of a conversion agreement dated July 1, 2019 between the Reporting Person and the Issuer, the Reporting Person will convert the Debentures into 2,909,091 Common Shares on July 1, 2020.
Except as disclosed herein, the Reporting Person does not have any contract, arrangement, understanding or relationship with respect to securities of the Issuer including, but not limited to, transfer or voting of any of the securities, finder's fees, joint ventures, loan or option arrangements, puts or calls, guarantees of profits, division of
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profits or loss, or the giving or withholding of proxies, the Reporting Person has not pledged securities of the Issuer nor are the securities of the Issuer held by the Reporting Person subject to a contingency, the occurrence of which would give another person voting power or investment power over such securities.
Item 7.Material to Be Filed as Exhibits
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Exhibit No.
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Description
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10.1
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Investment Agreement dated October 30, 2018, between the Reporting Person and the Issuer
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10.2
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Conversion Agreement dated July 1, 2019, between the Reporting Person and the Issuer
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Signature
After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct.
Dated: November 29, 2019
AUSTRALIS CAPITAL INC.
By: /s/ Michael Carlotti
Name: Michael Carlotti
Title: CFO
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EXHIBIT INDEX
Exhibit No.Description
10.1Investment Agreement dated October 30, 2018, between the Reporting Person and the Issuer(1)
10.2Conversion Agreement dated July 1, 2019, between the Reporting Person and the Issuer(2)
Notes:
(1)Previously filed as an exhibit to the Issuer’s Current Report on Form 8-K filed with the SEC on November 5, 2018 and incorporated by reference herein.
(2)Previously filed as an exhibit to the Issuer’s Current Report on Form 8-K filed with the SEC on July 8, 2019 and incorporated by reference herein.