ABcann Completes Acquisition of Harvest Medicine
NAPANEE, Ontario, Feb. 01, 2018 (GLOBE NEWSWIRE) — ABcann Global Corporation (TSX-V:ABCN) (“ABcann” or the “Company”) announced today that, further to its news release of December 12, 2017, it has completed the acquisition of Harvest Medicine Inc. (“HMed” or “Harvest Medicine”) pursuant to the terms of a share purchase agreement dated January 31, 2018 (the “Purchase Agreement”), in consideration for, among other things, a cash payment of $1.5 million; the issuance of 1,056,338 common shares in the capital of the Company (each, a “Share”); and additional post-closing consideration if certain performance milestones, which include certain patient, revenue and profitability metrics, are achieved (the “Transaction”).
As a result of the completion of the Transaction, Harvest Medicine has become a wholly-owned subsidiary of the Company but will maintain its commitment to being an open platform that enables patients to register with the Licensed Producer of their choice. To that end, ABcann has committed to invest $1.5 million to facilitate the development of new Harvest Medicine clinics and strategic patient-focused initiatives. ABcann has also entered into an employment agreement with Shekhar Parmar, the Chief Executive Officer of Harvest Medicine, pursuant to which he has been appointed Chief Strategy Officer of ABcann and will continue to act as CEO of HMed.
The acquisition of Harvest Medicine represents further progress toward our goal of becoming a vertically integrated medical cannabis company. It is one of the fastest-growing medical cannabis clinics in Canada, with an aggressive expansion plan and a patient-focused approach that is aligned with ABcann’s philosophy of quality and innovation.
Barry Fishman, Chief Executive Officer of ABcann
We look forward to working with Shekhar to integrate Harvest Medicine into ABcann as we continue to execute on our strategic vision.
“This transaction will allow Harvest Medicine to rapidly accelerate our expansion plans and bring our highly rated, patient-centric approach to patients in need. I am also personally looking forward to joining the executive team at ABcann and contributing to the continued dynamic growth of the company,” commented Mr. Parmar, Chief Executive Officer of Harvest Medicine.
In accordance with the terms of the Purchase Agreement, the Shares issued as partial consideration have been deposited into escrow pursuant to the terms of an escrow agreement dated January 31, 2018, and will be released in equal quarterly amounts over the three year period following the closing of the Transaction.
In connection with Mr. Parmar’s appointment as Chief Strategy Officer, the Company has granted Mr. Parmar 300,000 stock options, each of which is exercisable into one Share until January 31, 2023 at a price of $1.42 per Share, being the closing price per share on the TSX Venture Exchange on the date prior to the announcement of the binding letter agreement between the parties with respect to the acquisition of HMed. The options will vest monthly over 36 months from the date of grant.
About Harvest Medicine:
Harvest Medicine is an education focused, patient-centric, cannabis discovery center and clinic that has received tremendous response from its patients. Growing to over 9,700 active patients in under 12 months, and now acquiring over 1,300 new patients monthly from a single location, HMed is one of Canada’s most successful and fastest growing cannabis clinics.
Harvest Medicine is poised to expand its successful and highly scalable location in Calgary across the country. The first of these new clinics is expected to open in Edmonton in the spring of 2018 with other locations around the country being evaluated. Using a highly trained team of medical doctors and Canna Genius educators, Harvest Medicine provides a welcoming environment that focuses on educating patients on the safe and effective use of medical cannabis.
ABcann holds production and sales licenses from Health Canada. Its flagship facility in Napanee, Ontario contains proprietary plant-growing technology, centred on its specially designed, environmentally-controlled growing chambers. This approach results in the production of pharmaceutical-grade cannabis products.
The Company is expanding its cultivation capacity and pursuing partnerships and product development opportunities domestically, as well as in select international markets, such as Germany, Australia and Israel.
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