MONTREAL, Dec. 18, 2017
/CNW Telbec/ - LGC Capital Ltd. (TSXV: LG)
("LGC") is pleased to announce that further to
the news release dated December 6,
2017, the TSX Venture Exchange has now approved LGC's
transaction with Québec-based Tricho-Med Corporation (doing
business as AAA Trichomes).
This approval now clears the path to break ground near Montréal
for an initial 60,000 square feet of growing, processing and
administrative facilities for medical cannabis in the Montréal area
of Québec, Canada.
Ground breaking will, weather permitting, commence in
January 2018 with construction and
commissioning of Phase 1 expected to take about 10 months.
In order to significantly expand operations in Phase 2, AAA
Trichomes has secured options on two 20-acre plots nearby the
existing planned footprint, that will provide significant scope for
expansion in Phase 2.
LGC will now be providing financial support in order to assist
AAA Trichomes in becoming one of the larger growers in Québec thus
maximizing Québec's low energy cost advantage in this part of the
world.
At the closing of the transaction, LGC will enter into a
convertible loan agreement with AAA Trichomes in an amount of
$4,000,000 (the "Loan"). The
Loan will be disbursed in accordance with a pre-agreed milestone
disbursement schedule. The Loan has a term of four years and
will be secured by a first-ranking security on all of AAA
Trichomes' assets. Interest on the Loan is fixed at an annual rate
of 10% which will be payable from available operational cash flow.
Upon AAA Trichomes obtaining a licence to cultivate medical
cannabis from the relevant regulatory authorities, the Loan will
convert into common shares of AAA Trichomes representing 49% of the
AAA's then-issued and outstanding shares. LGC will also
receive a 5% royalty on AAA Trichomes' net sales.
John McMullen, CEO of LGC
stated, "LGC Capital is a Canadian investment company with a truly
global perspective and this investment in Québec is an important
development and milestone for the Company. LGC is excited to
partner with AAA Trichomes in creating a significant contributor to
the rapidly expanding legalized cannabis sector in Canada.
Subject to AAA Trichomes becoming a licensed producer, the
AAA Trichomes processing facility will be an enclosed
multi-level medical cannabis production operation.
AAA Trichomes is scheduled to start operations in late 2018 or
early 2019, with an initial annual production rate from the first
60,000 square feet, of approximately of 2,500 kgs annually and
reaching a planned annual production rate in excess of 20,000 kgs
by 2021 and thereafter significantly more as the project grows into
the recently added forty acres now under option.
About AAA Trichomes:
Tricho-Med Corporation (doing business as AAA Trichomes) is
Québec based and was incorporated in 2014 with the objective of
becoming a manufacturer and distributor of cannabis products in
Canada with an initial focus on
the Québec market. Since November 2016, AAA Trichomes has
been in the final review stage with Health Canada for the
processing of its application to become a licensed producer under
the Access to Cannabis for Medical Purposes Regulations.
About LGC Capital Ltd.:
www.lgc-capital.com
LGC Capital Ltd. is a Canadian incorporated public company
listed on the TSX Venture Exchange (TSXV: LG). LGC is a diversified
investment company with core holdings in businesses that provide
shareholders with exposure to a diverse range of high-growth
businesses, products and services. To date, LGC has entered into
agreements for investments in private cannabis operations in
South Africa, Australia and Canada. LGC also has a strategic alliance with
AfriAg (Pty) Ltd. to grow and distribute medical and recreational
cannabis products in the southern African region for export to
regulated and certified end users around the world; with Creso
Pharma Limited for the creation of a vertically-integrated cannabis
operation, which includes cultivation, IP generation, product
development, and commercialization; and is partnering with AAA
Trichomes to build one of the larger regulated medical cannabis
operations in Canada. LGC Capital
Ltd. is headquartered in Montréal, Canada.
FORWARD-LOOKING STATEMENTS
This press release may contain forward-looking statements with
respect to LGC Capital Ltd. ("LGC"), its proposed investment in
AAA Trichomes, and LGC's operations, strategy, investments,
financial performance and condition. These statements generally can
be identified by use of forward-looking words such as "may",
"will", "expect", "estimate", "anticipate", "intends", "believe" or
"continue" or the negative thereof or similar variations. The
actual results and performance of LGC, including its proposed
investment in AAA Trichomes, could differ materially from
those expressed or implied by such statements. Such statements are
qualified in their entirety by the inherent risks and uncertainties
surrounding future expectations. Some important factors that could
cause actual results to differ materially from expectations
include, among other things, general economic and market factors,
competition, government regulation and the factors described under
"Risk Factors and Risk Management" in LGC's Management's Discussion
and Analysis for the fiscal year ended September 30, 2016, as filed on SEDAR
(www.sedar.com). The cautionary statements qualify all
forward-looking statements attributable to LGC and persons acting
on its behalf. Unless otherwise stated, all forward-looking
statements speak only as of the date of this press release and LGC
has no obligation to update such statements, except to the extent
required by applicable securities laws.
Information Relating to AAA Trichomes:
All information contained in this press release relating to
Tricho-Med Corporation (doing business as AAA Trichomes) has
been provided to LGC by AAA Trichomes. LGC has relied upon
this information without having made independent inquiries as to
its accuracy or completeness and assumes no responsibility for any
inaccuracy or incompleteness of such information.
SOURCE LGC Capital Ltd