TORONTO, July 15, 2019 /CNW/ - National Access Cannabis
Corp. ("NAC" or "the Company") (TSXV: META), is pleased to announce
that it has entered into a conditional share purchase agreement
(the "Share Purchase Agreement") through Meta West Coast
Ltd., a wholly-owned subsidiary of NAC, to acquire 19.9% of
Sicamous Trading Company Incorporated ("STC") from the
shareholders of STC (collectively, the "Vendors").
Highlights
- Further solidifies NAC's position as the Canadian retail
cannabis leader1 – adds British Columbia ("BC") exposure to the
market in addition to the Company's 30 current licensed locations
in Alberta, Saskatchewan and Manitoba.
- STC currently has one retail cannabis store licence application
in process with the British Columbia Liquor and Cannabis Regulation
Branch (the "LCRB").
- STC plans to add more locations over the next 12 months,
building on the foundation of its first location in well-trafficked
vacation spot, Sicamous BC,
subject to receipt of required retail cannabis store licences.
- NAC has entered into a management agreement with STC whereby
NAC will provide certain store development and operational services
to support STC in its retail store development in exchange for
management fees calculated as a set percentage of STC's store-level
EBITDA for its first store and every successive store opened.
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1
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NAC is Canada's
largest cannabis retailer according to provincial licensing
statistics
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Mark Goliger, CEO of NAC
commented, "We have been telling shareholders for some time that we
see a significant opportunity to leverage NAC's deep operational
expertise into accretive arrangements with other cannabis
operators. NAC shareholders are expected to benefit from the
Company's ownership stake in these innovative organizations, a high
margin management fee income stream as well as incremental
purchasing power as we continue to grow our leading Canadian
network. I would like to personally welcome the Sicamous team to the NAC platform. Our team is
excited about STC's first location in this resort town and to
supporting the roll-out of additional locations."
Pursuant to the Share Purchase Agreement, NAC will acquire
199,000 class "A" common shares (the "Purchased Shares") in
the capital of STC, being 19.9% of the issued and outstanding
shares in the capital of STC, in exchange for $200,000, payable by the issuance of common
shares of NAC at a price of $0.53 per
share (the "Consideration Shares") to be distributed pro
rata among the Vendors (the "Transaction"). Upon execution
of the Share Purchase Agreement, the Purchased Shares and the
Consideration Shares are to be delivered to Alliance Trust Company,
as escrow agent (the "Escrow Agent"), to be held in escrow
until such time that STC acquires a retail cannabis store licence
from the LCRB and the LCRB has approved the transfer of the
Purchased Shares to NAC.
No commission, finder's fee or similar payment (whether in the
form of cash, securities or an interest in assets) were paid by the
Company in connection with the Transaction.
In connection with the closing of the Transaction, Consideration
Shares will be issued to an Insider of the Company (as such term is
defined under the policies of the TSX Venture Exchange). The
participation of the Insider in the Transaction constitutes a
"related party transaction" within the meaning of Multilateral
Instrument 61-101 – Protection of Minority Security Holders in
Special Transactions ("MI 61-101"). The Company is
relying upon exemptions from the formal valuation and minority
approval requirements of MI 61-101 based on a determination that
the fair market value of the Transaction, insofar as it involves
the related parties, does not exceed 25% of the market
capitalization of the Company. The Company was not in a
position to file a material change report more than 21 days in
advance of the closing of the Transaction, as the participation of
the related parties was not confirmed at that time. The
Transaction will not materially impact the percentage of securities
of the Issuer held by the Insider and the Transaction will not have
a material effect on the Company's business and affairs.
About National Access Cannabis Corp.
NAC is Canada's largest
recreational cannabis retailer by provincial store count. With a
portfolio of 28 retail locations nationwide, NAC is the leader in
secure, safe and responsible access to legal recreational cannabis
in Canada. Through its
Canada-wide network of Meta
Cannabis Supply Co.™ and NewLeaf Cannabis™ recreational cannabis
retail stores and NAC Medical's cannabis clinics and pharmacy
partnerships, NAC enables the public and registered patients to
gain knowledgeable access to Canada's network of authorized Licensed
Producers of cannabis. NAC is listed on the TSX Venture Exchange
under the symbol (TSXV: META).
For more information,
visit:
www.nationalaccesscannabis.com
www.metacannabis.com
www.newleafcannabis.ca
www.nacbio.com
www.nacmedical.com
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.
Cautionary Statements
This news release contains forward-looking statements and
forward-looking information within the meaning of applicable
securities laws. The use of any of the words "expect",
"anticipate", "continue", "estimate", "objective", "ongoing",
"may", "will", "project", "should", "believe", "plans", "intends"
and similar expressions are intended to identify forward looking
statements or information. Although the Company believes that the
expectations and assumptions on which the forward-looking
statements and information are based are reasonable, undue reliance
should not be placed on the forward-looking statements and
information because the Company cannot give any assurance that they
will prove to be correct. Since forward-looking statements and
information address future events and conditions, by their very
nature they involve inherent risks and uncertainties. Actual
results and developments may differ materially from those that are
currently contemplated by these statements depending on, among
other things, risks relating to the licencing of a license by the
LCRB and the approval of the transfer of the Purchased Shares by
the LCRB, the ability to obtain or maintain licences to retail
cannabis products; changes in STC's plan to add additional retail
locations and STCs ability to obtain or maintain licenses to retail
cannabis products; future legislative and regulatory developments
in British Columbia; general
business, economic, competitive, political and social
uncertainties; the delay or failure to receive regulatory
approvals; the competitive conditions of the cannabis industry; the
competitive and business strategies of the Company; and the
recreational and medical cannabis industry in Canada generally. The Company cautions that
the foregoing list of risks and uncertainties is not exhaustive.
The forward-looking statements and information contained in this
news release are made as of the date hereof and the Company
undertakes no obligation to update publicly or revise any
forward-looking statement or information, whether as a result of
new information, future events or otherwise, unless so required by
applicable securities laws.
SOURCE National Access Cannabis Corp.