(TheNewswire)
September 28, 2022 – TheNewswire - Molecule Holdings Inc. (CSE:MLCL) (OTC:EVRRF) (“ Molecule ” or the“ Company ”), a Canadian craft-focused cannabis beverage productioncompany, today announces that it has enteredinto a non-binding letter of intent (the “ Letter of Intent ”)for the acquisition (the “ Acquisition ”) of all of the issued and outstanding shares of Canna-Day Development Inc. (“ Canna-Day ”) fromthe shareholders of Canna-Day for an aggregate purchase price of$750,000, which shall be satisfied by theissuance of an aggregate of 15,000,000 common shares in the capital ofthe Company (the “ CommonShares ”) at a deemed price of $0.05 per CommonShare. Half of the Common Shares issued as consideration in theAcquisition shall be subject to a one (1) year escrow period.
Completion of the Acquisition is subject to certainconditions being satisfied including, but not limited to: (i)satisfactory completion of due diligence of each party; (ii) Canna-Dayhaving no liabilities, other than certain transaction costs; (iii) thecompletion of the Financing (as defined below); (iv) receipt of allnecessary regulatory and third-party consents, approvals andauthorizations as may be required in respect of the Acquisition andthe Financing, including without limitation, the approval of theCanadian Securities Exchange (the “ CSE ”), ifapplicable, any approvals required by Health Canada, and any approvalsrequired under the existing outstanding debt documentation of theCompany, all such consents, acceptances and approvals to be on termsand conditions acceptable to the Company; (v) approval of the board ofdirectors of the Company (the “ Board ”) to the final terms and conditions ofthe Acquisitionas set forth in the definitive agreement withrespect to the Acquisition; and (vi) certain other conditions that arecustomary for transactions of this nature.
Concurrent Financing
Concurrently with the Acquisition, the Company isproposing to complete a non-brokered privateplacement (the “ Financing ”, together with the Acquisition,the “ Transaction ”) of units (the “ Units ” and each, a “ Unit ”) of up to anaggregate of $3,750,000 at a price of $0.05 per Unit, with each Unitconsisting of one Common Share and one half of one Common Sharepurchase warrant (the “ Warrants ” and each whole warrant, a“ Warrant ”), resulting in the issuance of up to an aggregate of75,000,000 Common Shares and 37,500,000 Warrants, pursuant to anon-binding term sheet entered into between the Company and Jean-Denis Coté (the “ Term Sheet ”). Eachfull Warrant will be exercisable for one Common Share (the“ Warrant Shares ” and each, a “ Warrant Share ”) at an exercise price of$0.10 per Warrant Share for a period of two years from the closingdate of the Financing.
The Financing will be led by one or more of theshareholders of Canna-Day as the lead investor(s) (collectively, the“ Lead Investors ”) and is anticipated to include other family, friends andbusiness associates of the Company.
Completion of the Financing will be conditional on thefollowing, among other things (i) a minimum of $3,500,000 beingraised, with the Lead Investors having a minimum investment of$2,000,000; (ii) the Lead Investors being satisfied with theirdiligence efforts on the Company; (iii) the holders of a number ofoutstanding debentures of the Company agreeing to certain terms andcertain outstanding debentures of the Company being redeemed; (iv) allrelevant corporate and regulatory approvals being obtained (including,but not limited to, required corporate approvals, CSE approval, if necessary, and Health Canadaapproval, if necessary); (v) the appointment of the current ChiefExecutive Officer of Canna-Day to be the Chief Executive Officer ofthe Company, subject to clearance by the CSE of a CSE Form 3 – Personal InformationForm (“ PIF ”) and security clearance by HealthCanada; (vi) the appointment of a new independent chair to the Boardand a nominee of Canna-Day to the Board in replacement of two existingdirectors, with each Board appointment being subject to the clearanceof a PIF with the CSE and obtaining security clearance from HealthCanada; and (vii) the entrance into an investor rights agreementbetween the Company and the Lead Investors that would provide forcertain Board nomination rights, approval rights, anti-dilution rightsand top-up rights, provided the shareholdings of the Lead Investors inthe Company are above certain thresholds.
All securities issued in connection with the Financingwill be subject to a statutory hold period of four months and one dayfrom the date of issuance in accordance with applicable securitieslegislation, and such other resale restrictions as prescribed by thepolicies of the CSE.
The Company intends to use the net proceeds from theFinancing to finance working capital and general corporatepurposes.
For further information, please contact:
André Audet, Chairman and Co-Founder
Phone: 1 (888) 665-2853 x101
Email: andre@molecule.ca
About MoleculeHoldings Inc.
Molecule is a licensed producerdedicated to creating cannabis-infused beverages for the Canadianmarket. We produce leading, top-quality drinks to provide opportunityand choice to people seeking a convenient and social way to consumecannabis. Molecule is focused on growing both our portfolio, and theoverall cannabis beverage market. We want to ensure people have thebest opportunity to find exactly the product and experience theythirst for.
About Canna-Day DevelopmentInc.
Canna-Day is a beverage company thathas developed a range of innovative cannabis-based beverages and wasfounded by a group of industry veterans. Canna-Day’s Chief ExecutiveOfficer, Charles Crawford, was the founder of Domaine Pinnacle andUngava Spirits (now a division of Corby) which he built into aCanadian leader in the craft cider and spirits industries, withdistribution nationally and internationally. Canna-Day’s otherexperienced beverage-industry principals include Jean-Denis Côté,the founder of Groupe Paul Masson (now Arterra) and Tristan BourgeoisCousineau, the Chief Executive Officer and founder of GroupeTriani/Thirsty Beverages.
Neither the CSE nor its regulation services provideraccepts responsibility for the adequacy or accuracy of this pressrelease.
Cautionary Note and RiskFactors
This press release containsstatements that constitute “forward-looking information”(“forward-looking information”) within the meaning of theapplicable Canadian securities legislation. All statements, other thanstatements of historical fact, are forward-looking information and arebased on expectations, estimates and projections as at the date ofthis news release. Any statement that discusses predictions,expectations, beliefs, plans, projections, objectives, assumptions,future events or performance (often but not always using phrases suchas “expects”, or “does not expect”, “is expected”,“anticipates” or “does not anticipate”,“plans”, “budget”, “scheduled”, “forecasts”,“estimates”, “believes” or “intends” or variations of suchwords and phrases or stating that certain actions, events or results“may” or “could”, “would”, “might” or “will”be taken to occur or be achieved) are not statements of historicalfact and may be forward-looking information. In disclosing theforward-looking information contained in this press release, theCompany has made certain assumptions. Forward-looking information inthis press release includes: the ability of the Company and Canna-Dayto complete the Transaction on the terms and timing described herein,or at all; the ability of the Company and Canna-Day to obtain allnecessary corporate and regulatory approvals, including Boardapproval, any approval required from the CSE and Health Canada; theability of the management and Board nominees of Canna-Day to clear aPIF and obtain security clearance from Health Canada; the ability ofthe Company to obtain any necessary consents or agreements from thedebentureholders referenced herein; the use of proceeds of theFinancing.
The Company’s actual results coulddiffer materially from those anticipated in this forward-lookinginformation as a result of regulatory decisions, competitive factorsin the industries in which the Company operates, prevailing economicconditions, and other factors, many of which are beyond the control ofthe Company. Specifically, there are risks that: the Transaction maynot be completed on the terms and timing described herein or at all;the Company and Canna-Day may not be able to obtain any of thenecessary corporate and regulatory approvals, including Boardapproval, any approval required from the CSE or Health Canada; themanagement and board nominees of Canna-Day may be unable to clear aPIF or obtain security clearance from Health Canada; there is adeterioration of market conditions such that the minimum amount of theFinancing cannot be raised; debentureholders of the Company may notagree to the terms set out in the Term Sheet; the benefits of theTransaction to the Company, including the Company capitalizing on theindustry experience of the principals of Canna-Day, may notmaterialize; the use of proceeds of the Financing may differ from theuse of proceeds set out herein. Additional risk factors can also befound in the Company’s current MD&A, which has been filed onSEDAR and can be accessed at www.sedar.com .
The Company believes that theexpectations reflected in the forward-looking information arereasonable, but no assurance can be given that these expectations willprove to be correct and such forward-looking information should not beunduly relied upon. Any forward-looking information contained in thisnews release represents the Company’s expectations as of the datehereof and is subject to change after such date. The Company disclaimsany intention or obligation to update or revise any forward-lookinginformation whether as a result of new information, future events orotherwise, except as required by applicable securitieslegislation.
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