NAPANEE, Ontario, Oct. 23, 2018 (GLOBE NEWSWIRE) — VIVO Cannabis Inc. (TSXV: VIVO, OTCQX: VVCIF) (“VIVO” or the “Company”) is pleased to announce that it has agreed to make a $5 million strategic investment in National Access Cannabis Corp. (TSXV: META) (“NAC”), and commited to invest an additional $5 million contingent on attainment of a growth-related milestone and the satisfaction of certain other conditions precedent. NAC intends to use the proceeds of the investment, and additional recent and proposed financings, to advance the roll out of its retail cannabis operations across Canada. NAC’s vision is to be one of the largest adult-use retailers in Canada, with over 200 locations providing safe and responsible access to legal cannabis in Canadian private retail markets, subject to licensing and regulatory approvals.
VIVO sees great benefit in investing in and establishing strong relationships with leading recreational retail players in Canada, as represented by our two previously announced strategic investments and partnerships in the sector earlier this year. We believe that the retail side of the industry has great potential and with our strong cash position, we chose to make another strategic investment in a leading cannabis retailer.
Barry Fishman, CEO of VIVO
NAC’s retail brands (META and Newleaf) are aligned with our philosophy of delivering top quality products through a premium and engaged customer experience. They are well-positioned to be a dominant player in the Canadian retail landscape. VIVO looks forward to working with the NAC team to provide Canadian adult-use consumers access to our premium portfolio of brands, including FIRESIDE™, Lumina™ and Canna Farms™.
“The two main factors needed in creating growth in the legal adult-use industry are convenient access and demanded products,” stated Mark Goliger, CEO of NAC. “NAC will play a dominant role in providing safe and responsible legal access points across Canada, via an expected footprint of 200+ stores across five private retail provinces. We are very happy to have an investor and partner in VIVO who has developed premium quality products and compelling brands. We trust that as an investor in NAC, VIVO will impart some of the strategy, creativity and expertise that they put into their consumer brands to enable enhanced market potential for our retail store brands, META Cannabis Supply Co. and NewLeaf Cannabis.”
VIVO Strategic Investment
VIVO has agreed to participate in private placements of NAC common shares for an aggregate amount of up to $10 million, which, subject to satisfaction of certain terms and conditions precedent, will be completed in two tranches. Under the initial tranche, VIVO has agreed to acquire NAC common shares for an aggregate purchase price of $5 million. Closing of the initial tranche is expected to occur on October 26, 2018.
If before October 26, 2019, NAC is granted approval to open an aggregate of 50 cannabis retail locations from applicable regulatory authorities in Canada, NAC may deliver a written notice to VIVO requiring VIVO to purchase and subscribe for $5 million of additional NAC common shares at a price per share equal to the 15 day volume weighted average trading price of the NAC common shares on the TSX Venture Exchange (the “TSXV”) for the last 15 trading days of the calendar month immediately preceding the date of the notice, or if such trading price is lower than the maximum permitted discount for the second tranche of the LP Financing, the maximum permitted discount for the issuance of the Common Shares under TSXV policies.
About VIVO Cannabis™
VIVO, based in Napanee, Ontario, is recognized for trusted, high-quality products and services. It holds production and sales licences from Health Canada and operates world-class indoor cultivation facilities with proprietary plant-growing technology. VIVO has a collection of premium brands targeting unique customer segments, including Beacon Medical™, FIRESIDE™, Canna Farms™ and Lumina™. In August 2018, VIVO acquired Canna Farms Limited, a premium cannabis company based in Hope, British Columbia. Canna Farms was B.C.’s first Licensed Producer and has many years of craft cultivation experience and expertise, as well as a significant patient base and positive cash flow. VIVO is significantly expanding its production capacity and pursuing partnership and product development opportunities domestically, as well as in select international markets, including Germany and Australia. In addition, VIVO also operates Harvest Medicine, a patient-centric and highly scalable network of specialty medical cannabis clinics. Harvest Medicine provides best-in-class education and support to over 22,000 patients in its clinics and via its free telemedicine platform. VIVO has a healthy balance sheet and is well-positioned to accelerate the growth of its business, in Canada and internationally.
About National Access Cannabis
NAC is a best practices leader in delivering secure, safe, and responsible access to legal cannabis in Canada. Through its Canada-wide network of medical cannabis clinics, partner pharmacies, NAC Bio’s clinical research division, NewLeaf Cannabis™ and Meta Cannabis Supply Co.™ recreational cannabis retail stores, NAC enables patients and the public to gain knowledge and access to Canada’s network of authorized Licensed Producers of cannabis. NAC is listed on the TSX Venture Exchange under the symbol (TSXV: META).