#Cannabis Stock News: Standard (TSX VENTURE: $SGH.V) to Acquire Medi-Can Health Solutions Ltd.
VANCOUVER, BRITISH COLUMBIA - September 1, 2017 (Investorideas.com Newswire) Standard Graphite Corp. (TSX VENTURE:SGH) (the "Company") is pleased to announce that it has entered into a share purchase agreement with Medi-Can Health Solutions Ltd. ("Medi-Can") and its shareholders (the "Medi-Can Shareholders") pursuant to which the Company will acquire (the "Acquisition") all of the issued and outstanding common shares of Medi-Can.
Medi-Can, a cannabis production licence applicant under Health Canada's Access to Cannabis for Medical Purposes Regulations (ACMPR), holds a leasehold property in Vernon, B.C. and extensive cannabis cultivation equipment. Medi-Can's planned phase 1 cannabis production facility will be capable of producing approximately 660 kg/year of dried cannabis and its planned phase 2 expansion plans would increase its cannabis production capacity to a total of 1500 kg/year.
Medi-Can intends to focus its business, subject to obtaining a cannabis production licence, on the highest quality handcrafted strains and intends to develop a unique lifestyle brand for cannabis. Medi-Can plans to feature a range of curated, handcrafted strains ideally suited for Canada's emerging cannabis market. The Okanagan Valley, which includes the cities of Vernon and Kelowna, features British Columbia's world class wineries, lakes, orchards, golf courses and ski hills, which draws 1.9 million visitors annually.
Medi-Can was founded by the proven entrepreneurial team of Robert Bayrack, John Oh, Adrian Robinson and Josh Brazier, who are the Medi-Can shareholders and will help to drive the success of Medi-Can following closing of the Acquisition.
Robert Bayrack is the Senior Person in Charge under the ACMPR application for Medi-Can. He is a master grower with extensive knowledge of cannabis horticulture, plant pathology and cultivation mastery for the commercial market. Robert brings a wealth of knowledge and experience from growing medical-grade cannabis for designated medical patients. In addition, his background in project management and construction has translated to efficient growing systems, production planning, plants scheduling and quality assurance for commercial grow operations. He is a firm believer and advocate in providing adequate and safe access to high-quality craft cannabis to patients across Canada.
John is a well-regarded entrepreneur who has received entrepreneurial awards from the Greater Vernon Chamber of Commerce. Professionally, his passion for technology and e-commerce has led him to hold leadership roles for one of Canada's top SaaS companies. John earned a Master's degree in Interdisciplinary Graduate Studies from the University of British Columbia.
Adrian Robinson is a strategically minded entrepreneur who has been leading pursuits in real estate investment, hospitality management and cannabis facility operations for more than a decade. His hands on approach has provided him with extensive knowledge in all facets of business development, from initial concept through to fostering relationships with industry leaders and government agencies. Adrian, a Royal Roads University graduate, is applying his innovative thinking and management expertise to the emerging medical cannabis industry. Adrian is a founding member of Quintet, a strategic alliance of business professionals with a focus on sustainable growth, and the Cannabis Trade Alliance of Canada, a not-for- profit organization supporting the development of a safe and ethical and inclusive cannabis industry.
Josh Brazier is an accomplished entrepreneur and philanthropist with a psychology degree from the University of British Columbia. His passion for business and innovation has led to accolades such as Young Entrepreneur of the Year, New Business of the Year and being recognized as one of the Top 30 Entrepreneurs under the age of 30, in the city of Vernon, British Columbia. Josh has co-founded a number of successful ventures and has recently enjoyed international success as a result of manufacturing and exporting a line of hydroponic products that are now available in over 20 countries across the globe.
Pursuant to the Acquisition, on the closing date, the Company will acquire all of the shares of Medi-Can, which will become a wholly-owned subsidiary of the Company, and the Company will issue to the Medi-Can Shareholders, based on their pro rata holdings, the following:
- 12,500,000 common shares into escrow, 10% of which will be released on the Closing and the balance over 36 months; and
- a non-interest bearing note in the amount of $2,500,000, which will mature on the fifth trading day after the receipt by Medi-Can of a cultivation license under the ACMPR is announced, at which time the Company will have the option to either pay $2,500,000 in cash, or issue $2,500,000 of its common shares (valued using the 20 day volume-weighted average trading price).
The definitive share purchase agreement includes customary conditions, including obtaining all necessary corporate approvals and applicable exchange acceptances. The Acquisition is arms-length and will constitute a change of business of the Company under the policies of the TSX Venture Exchange. In connection with the Acquisition, the Company (i) will apply to list on the Canadian Securities Exchange, (ii) will seek shareholder approval of, among other things, the Acquisition and change of its business, (iii) intends to effect a name change on the closing, and (iv) expects to apply to voluntarily delist its shares from the TSX Venture Exchange. The Company is expecting to seek all necessary approvals from its shareholders in connection with the Acquisition at its annual general and special meeting of shareholders scheduled for October 18, 2017.
Marapharm LOI, Private Placement and Other Matters
The Company announced June 1, 2017 that it entered in to a letter of intent with Marapharm Inc. to acquire its ACMPR license application and all associated property and plans in consideration of payment by shares from the Company. The transaction was subject to completion of due diligence, a definitive acquisition agreement being executed by the parties, and board and regulatory approval. The parties have mutually agreed to terminate the agreement and the Company will no longer pursue the acquisition of Marapharm Inc.
The company is proceeding with a non-brokered private placement of units of $500,000 at a price of $0.15 per unit (a "Unit"). Each Unit offered will consist of one common share of the company and one-half of one common share purchase warrant. Each full warrant will be exercisable into one common share of the company at $0.25 per share for 18 months. Proceeds are to be used for general corporate purposes, the Company's continuing evaluation of other opportunities in the cannabis market, and for the costs incurred in connection with the Acquisition. All securities issued in connection with the private placement will be subject to a four-month hold period. Closing of the placement is subject to TSXV acceptance.
The Company further reports that it has elected not to fund the expenditures necessary to satisfy the Option Agreement on the Philibert Property, and has therefore terminated its rights under the agreement.
ON BEHALF OF THE BOARD,
Chris Bogart, President & CEO
The TSX Venture Exchange has in no way passed upon the merits of the proposed transaction and has neither approved nor disapproved the contents of this press release. Completion of the transaction is subject to a number of conditions, including but not limited to, Exchange acceptance and shareholder approval. The transaction cannot close until the required approvals are obtained. There can be no assurance that the transaction will be completed as proposed or at all. Investors are cautioned that, except as disclosed in the Information Circular to be prepared in connection with the transaction, any information released or received with respect to the Acquisition may not be accurate or complete and should not be relied upon. Trading in the securities of the Company should be considered highly speculative.
This news release contains forward-looking information relating to the Company's proposed acquisition, private placement and other statements that are not historical facts. Forward-looking information relates to management's future outlook and anticipated events or results, and include statements or information regarding the future plans or prospects of the Company. Although management of the Company has attempted to identify important factors that could cause actual results to differ materially from those contained in forward looking information, there may be other factors that cause results not to be as anticipated, estimated or intended. These factors include risks and uncertainties associated with the results of diligence investigations, developments in the cannabis sector and the mining sector, exploration results, delays resulting from or inability to obtain required regulatory approvals and ability to access sufficient capital from internal and external sources, reliance on key personnel, regulatory risks and delays and other risks and uncertainties discussed in the management discussion and analysis section of the Company's interim and most recent annual financial statement or other reports and filings made with the applicable Canadian securities regulators. There can be no assurance that such information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward looking information.
The forward-looking statements contained in this news release are made as of the date of this news release. Except as required by law, the Company disclaims any intention and assumes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Additionally, the Company undertakes no obligation to comment on the expectations of, or statements made by, third parties in respect of the matters discussed above. There can be no assurance that the proposed acquisition will be completed as proposed or at all.
Standard Graphite Corp.
President & CEO
(604) 683-2506 (FAX)
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