Invictus MD Announces Binding LOI to Acquire Health Canada Licensed Producer and $10 Million Private Placement
Invictus MD Strategies (CSE:IMH) has announced that it has entered into a binding letter of intent to acquire 33 1/3 percent of AB Laboratories and 33 1/3 percent of AB Farms for a total aggregate transaction value of $17.25 million, based on the November 17, 2016 closing price.
As quoted in the press release:
Concurrent Private Placement
The Company also announces a concurrent private placement of units at a price of $1.05 per unit to raise gross proceeds of CAD$10,000,000 (the “Offering”), which will be used to fund the acquisitions. Each unit will consist of one common share and one-half of a common share purchase warrant exercisable to purchase an additional share at $1.75 for 18 months. The warrants will also be subject to an acceleration clause whereby if the closing price of the Company’s shares is equal to or greater than $2.75 for a period of 10 consecutive trading days, the Company will have the right to accelerate the expiry of the warrants by giving 10 business days’ notice.
The letter of intent provides for the vendors participation in the Offering of up to CAD$3,000,000. Certain insiders of the Company have also indicated that they will participate in the Offering.
Eventus Capital Corp. will act as the finder in connection with a portion of the Offering. Finder’s fees in connection with the Offering will consist of a combination of cash and/or finder’s warrants.
The first transaction is to acquire 33 1/3% of AB Labs with the payment of CAD$7,000,000 in cash and the issuance of such number of common shares of Invictus MD as is equal to CAD$1,250,000 based on the volume weighted average trading price of Invictus MD three (3) days prior to entering into the definitive agreement and an additional 1,200,000 common shares issued at closing.
The second transaction is to acquire 33 1/3% of AB Farms with the payment of CAD$7,500,000 on an as needed basis. In connection with the acquisition of AB Farms, Invictus MD will pay a non-refundable deposit of CAD$100,000.