ABcann Global (TSX-V:ABCN) (formerly Panda Capital Inc.) (“ABcann” or the “Company”) is pleased to announce that it has completed its Qualifying Transaction (as defined in the policies of the TSX Venture Exchange (the “TSXV”)) (the “Transaction”), pursuant to which it acquired all of the outstanding securities of ABcann Medicinals Inc. (“ABcann Medicinals”), a licensed Canadian cannabis producer. The Company expects to resume trading as a Tier 2 Industrial Issuer on the TSXV under the symbol “ABCN” at market open on Thursday, May 4, 2017.

In connection with the closing of the Transaction (the “Closing”), the Company:

  • changed its name to ABcann Global Corporation;
  • completed a private placement of subscription receipts (each, a “Subscription Receipt”) for aggregate gross proceeds of $11.8 million;
  • completed a private placement of secured convertible debentures (the “Debentures”) in the aggregate principal amount  of $15 million; and
  • appointed Aaron Keay, Kenneth Clement, Paul Lucas, John Easson, Daryl Kramp and Andrew LaCroix as directors, and Aaron Keay, Ying (Jenny) Guan, Neil Kapp and Andrew LaCroix as officers of the Company,

all as further described in this news release and in the Company’s filing statement dated March 31, 2017 (the “Filing Statement”) with respect to the Transaction.

ABcann Medicinals, based in Napanee, Ontario, was founded in 2012. It obtained its initial license for cultivation of medical cannabis from Health Canada in 2014, followed by a license to sell in 2015, and commenced commercial sales in 2016. ABcann Medicinals has:

  • raised over $43 million in capital since incorporation;
  • a fully-operational 14,500 square foot facility with production capacity of 1,000 kilograms annually;
  • plans to commence development of a 71,000 square foot facility with production capacity of 20,000 kilograms per year;
  • re-order rates in excess of 94%, among the highest in the sector; and
  • a strong advisory team led by the “father of cannabis”, Dr. Raphael Mechoulam.

“This is a historical day for ABcann as we conclude the process to becoming publicly listed. The ABcann team has done a remarkable job preparing us for this moment, where we will look to grow and deliver a repeatable standardized quality product not only in Canada, but internationally,” said Kenneth Clement, Founder and Executive Chairman. “We would also like to thank our board of directors for their years of commitment and our loyal shareholders who helped us complete our initial fully operational facility with their funding. We view this as the next chapter for ABcann as we look to deliver on our mission of changing lives globally by delivering our high quality, consistent and pesticide free product to patients around the world.”

“ABcann’s IPO is a significant milestone for the Company as we look to aggressively expand our domestic production facilities and international opportunities,” said ABcann director and CEO, Aaron Keay.  “The capital raised concurrently with the closing of this transaction will allow us to scale our already proven high quality, consistent and proprietary growing techniques, enabling us to take advantage of the tremendous opportunity in the medical cannabis market.  In so doing, ABcann will become a premier choice for patients who want a consistent, standardized product that they can rely on.”

Closing of Qualifying Transaction

In connection with the Closing, the Company’s wholly-owned subsidiary amalgamated with ABcann Medicinals under the provisions of the Business Corporations Act (Ontario), with the amalgamated company being named “ABcann Medicinals Inc.” and now being a wholly-owned subsidiary of the Company. The Company issued one common share in the capital of the Company (each, a “Share”) to each former shareholder of ABcann Medicinals, on a one for one basis. Convertible securities of ABcann Medicinals will now be convertible into Shares (instead of shares in the capital of ABcann Medicinals) with the other terms of such securities, including conversion prices and expiry dates, to remain the same. After giving effect to the completion of the Transaction and the conversion of the Subscription Receipts, there are 99,626,679 Shares issued and outstanding (on an undiluted basis), with approximately 30% of the Shares (on an undiluted basis) held by insiders.

New Board of Directors and Management Team

In connection with the Closing, the Company welcomes a new board of directors and management team. The Company will be led by Aaron Keay, who has been appointed Chief Executive Officer, and Kenneth Clement, who has been appointed as Executive Chair. In addition, Paul Lucas, John Easson, Daryl Kramp and Andrew LaCroix have been appointed as new directors of the Company. Ying (Jenny) Guan has been appointed Chief Financial Officer and Corporate Secretary, Neil Kapp has been appointed Chief Operating Officer and Andrew LaCroix has been appointed Vice-President of Business Development. Paul Barbeau, Kees Van Winters, Michael Franks and Bryan deBettencourt have resigned as directors and officers of the Company and the Company thanks them for their service in bringing the Company to completion of its Qualifying Transaction.

Closing of Subscription Receipt Financings

Immediately prior to the Closing, the Company completed:

  • a brokered private placement pursuant to which it sold an aggregate of 13,407,689 Subscription Receipts at a price of $0.80 per Subscription Receipt (the “Issue Price”) for gross proceeds of $10,726,151.20 (the “Brokered Financing”), and
  • a non-brokered private placement pursuant to which it sold an aggregate of 1,342,311 Subscription Receipts at the Issue Price for gross proceeds of $1,073,848.80 (the “Non-Brokered Financing” and, together with the Brokered Financing, the “Subscription Receipt Financings”),

for aggregate gross proceeds of $11,800,000.00. As previously announced, Canaccord Genuity Corp. (“Canaccord Genuity”) and PI Financial Corp. (together with Canaccord Genuity, the “Agents”) acted as agents in respect of the Brokered Financing.

The gross proceeds of the Brokered Financing (the “Brokered Escrowed Funds”) were deposited into escrow with TSX Trust Company, as escrow agent (the “Escrow Agent”), pursuant to the terms of a subscription receipt agreement dated April 28, 2017 (the “Subscription Receipt Agreement”) among the Company, the Escrow Agent and Canaccord Genuity, pending satisfaction of the Escrow Release Conditions (as defined in the Subscription Receipt Agreement), which included that all conditions precedent to the closing of the Transaction, other than the filing of articles of amalgamation, be satisfied or waived and that all conditions precedent to the closing of the Debenture Financing (as defined herein) be satisfied or waived to the satisfaction of the Agents. The Escrow Release Conditions were satisfied on the same day.

The gross proceeds of the Non-Brokered Financing (the “Non-Brokered Escrowed Funds”) were deposited into escrow with the Company’s legal counsel pursuant to the terms of an escrow agreement dated April 28, 2017 (the “Escrow Agreement”) between the Company and the Company’s legal counsel, pending satisfaction of the Escrow Release Condition (as defined in the Escrow Agreement), which was substantially similar to the Escrow Release Conditions set out in the Subscription Receipt Agreement, and was also satisfied on the same day.

Because the Escrow Release Conditions under both the Subscription Receipt Agreement and the Escrow Agreement were satisfied on the same day as the closing of the Subscription Receipt Financings: (i) the Brokered Escrowed Funds (less the cash portion of the Agents’ Fee (as defined herein) and the Agents’ expenses, which were released to the Agents), and (ii) the Non-Brokered Escrowed Funds were released to the Company, and each Subscription Receipt converted into one Share without payment of additional consideration or further action on the part of the holders thereof.

In connection with the Brokered Financing, the Company: (i) paid the Agents a cash commission of $743,400, of which $408,369 was settled by the issuance of an aggregate of 510,462 Shares at the Issue Price (the “Agents’ Fee”), (ii) issued the Agents an aggregate of 929,250 compensation options, each of which entitles the holder to acquire one Share at the Issue Price until April 28, 2019, and (iii) reimbursed the Agents for their reasonable expenses in connection with the Brokered Financing.

Closing of Debenture Financing

The Company also completed a non-brokered private placement of Debentures in the aggregate principal amount of $15 million (the “Debenture Financing” and, together with the Subscription Receipt Financings, the “Concurrent Financings”), with two industry leading institutional investors, having a conversion price equal to a 30% premium to the Issue Price of the Subscription Receipts. The Debentures:

  • mature on April 28, 2020 and bear interest at the rate of 10% per annum, commencing on the issue date of the Debentures, payable semi-annually on the last day of June and December of each year;
  • are secured by a security interest over all of the assets of the Company and each of its subsidiaries; and
  • are convertible at the option of the holders into Shares at any time prior to the close of business on the maturity date at a conversion price (the “Conversion Price”) equal to an amount which represents a 30% premium to the Issue Price per Subscription Receipt. Given that the Issue Price per Subscription Receipt was $0.80, it is expected that the Conversion Price will be $1.04 per Share.

In the event that the Company completes a subsequent equity financing at a price below the Conversion Price, the Conversion Price will be adjusted downward to the price per Share of any subsequent equity financing, subject to a floor price equal to the Issue Price. If, at any time prior to the maturity date, the volume weighted average price of the Shares on the TSXV (or such other stock exchange or quotation system as the Shares are then principally listed or quoted) for any consecutive 10 day trading period is greater than $1.80, the Company, at its sole option, may, at any time thereafter, force a conversion of the Debentures.

All outstanding indebtedness of the Company (other than the Replacement Debentures (as defined herein)) was subordinated to the Debentures as of the closing of the Debenture Financing.

In connection with the closing of the Debenture Financing, the Company also issued to the investors under the Debenture Financing:

  • new secured convertible debentures in the aggregate principal amount of $5,262,500 (the “Replacement Debentures”) in exchange for existing debentures in the aggregate principal amount of $5,000,000 issued by ABcann Medicinals (the “ABcann Debentures”) to the investors under the Debenture Financing, with the principal amount of the Replacement Debentures representing the original principal amount of the ABcann Debentures plus accrued interest thereon to the Closing, and with the other terms of the Replacement Debentures being substantially similar to those of the ABcann Debentures;
  • an aggregate of 4,406,250 warrants, each of which is exercisable to acquire one Share at any time until April 28, 2019 at an exercise price of $0.80 per Share, 3,906,250 of which were issued pursuant to the terms of the ABcann Debentures; and
  • an aggregate of 15 million warrants that will vest and become exercisable on July 1, 2018 if the Company has not completed, on or before that date, one or more financings for aggregate proceeds of at least $18 million through: (i) the exercise of outstanding warrants or a new equity issuance from treasury (or a combination of both); (ii) a debt facility acceptable to the lead subscribers in the Debenture Financing, or (iii) a combination of both.

Additional details regarding the terms of these warrants and the Debentures, including certain adjustment and acceleration provisions in connection therewith, are more particularly disclosed in the Filing Statement.

The proceeds of the Concurrent Financings will be primarily be used for expansion of the existing ABcann Vanluven facility, development and construction of the proposed ABcann Kimmett facility, research and development, negotiation of international licensing and distribution agreements, and general working capital purposes.

All securities issued in connection with the Concurrent Financings (including, for greater certainty, the Shares), are subject to a statutory hold period of four months and one day expiring on August 29, 2017, and such other hold periods as required under applicable securities laws.

Grant of Stock Options and RSUs

In connection with the Closing, the Company also granted an aggregate of 1,079,000 stock options and 2,972,888 restricted share units, as further described in the Filing Statement.

No securities of the Company (including, for greater certainty, the Shares) have been or will be registered under the United States Securities Act of 1933, as amended (the “U.S. Securities Act”), or the securities laws of any state, district or commonwealth of the United States (as defined in Regulation S under the U.S. Securities Act). Accordingly, these securities may not be offered or sold, directly or indirectly, within the United States or to or for the account or benefit of any “U.S. Person” (as defined in Regulation S under the U.S. Securities Act), absent an exemption from the registration requirements of the U.S. Securities Act and applicable state securities laws. This news release does not constitute an offer to sell or a solicitation of an offer to buy any of the securities described in this news release in the United States or any jurisdiction where such offer or sale would be unlawful, or for the account or benefit of any U.S. Person or person within the United States.


“Aaron Keay”
Aaron Keay
Chief Executive Officer and Director

For further information, please contact Aaron Keay by phone at (604) 323-6911 or by email at OR Leo Karabelas by phone (416) 543-3120 or by email at

Neither 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.

Disclaimer for Forward-Looking Information

Certain statements in this release are forward-looking statements, which reflect the expectations of management regarding the Company’s future business plans. Forward-looking statements consist of statements that are not purely historical, including any statements regarding beliefs, plans, expectations or intentions regarding the future. Forward looking statements in this news release include statements relating the use of proceeds of the Concurrent Financings, ABcann’s future site development and expansion plans, and ABcann’s plans to grow and deliver a repeatable standardized quality product. Such statements are subject to risks and uncertainties that may cause actual results, performance or developments to differ materially from those contained in the statements, including that: the proceeds of the Concurrent Financings may not be allocated as currently contemplated or factors may arise which cause the Company’s currently contemplated expansion and development plans to cease or otherwise change. No assurance can be given that any of the events anticipated by the forward-looking statements will occur or, if they do occur, what benefits the Company will obtain from them. Readers are urged to consider these factors carefully in evaluating the forward-looking statements contained in this news release and are cautioned not to place undue reliance on such forward-looking statements, which are qualified in their entirety by these cautionary statements. These forward-looking statements are made as of the date hereof and the Company disclaims any intent or obligation to update publicly any forward-looking statements, whether as a result of new information, future events or results or otherwise, except as required by applicable securities laws.

Click here to connect with ABcann Global (TSX-V:ABCN) to receive an Investor Presentation.


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