PROVINCE BRANDS OF CANADA ANNOUNCES REVERSE TAKEOVER OF COLSON CAPITAL CORPORATION
Colson Capital Corp. and Honest Inc., doing business as Province Brands of Canada, have signed a letter of intent (LOI) for Colson to acquire all of the issued and outstanding common shares in the capital of Province Brands in exchange for common shares in the capital of Colson.
General information on Province Brands
Province Brands, a company incorporated under the laws of Canada, is an early-stage, Toronto-based, disruptive premium adult beverage company founded by veteran entrepreneurs with extensive experience in the premium alcohol and legal medical and recreational cannabis industries. Province Brands' patent-pending process has created the world's first beer brewed using cannabis. Alcohol-free yet intoxicating, and with a dose-response curve similar to that of alcohol, Province Brands' cannabis-powered beers and spirits will challenge the alcohol industry by offering a safer and healthier alternative that is also low in calories and sugar. Province Brands is also developing additional premium spirits and beverages in anticipation of legalization of the use of cannabis-based products in Canada, which is anticipated to occur in the early fall of 2019.
"Province Brands' mission is to create safer and healthier alternatives to alcohol through a portfolio of products that intoxicate using cannabis, including beer brewed from the cannabis plant rather than barley. We're starting an entirely new brewing tradition and we are excited to partner with the public in doing so," said Dooma Wendschuh, co-founder and chief executive officer of Province Brands.
General information regarding the LOI
Province Brands and Colson entered into the LOI on April 27, 2018, which sets out the basic terms and conditions for the acquisition. The acquisition is expected to be structured as a reverse takeover (RTO) under the rules and policies of the TSX Venture Exchange. Upon completion of the acquisition, the combined entity will continue to carry on the business of Province Brands. It is expected that upon completion of the acquisition, the resulting issuer will meet the initial listing requirements for a Tier 1 life sciences issuer under the policies of the TSX-V.
The transaction terms outlined in the LOI are non-binding and the acquisition is subject to the parties successfully entering into a definitive agreement in respect of the acquisition on or before Aug. 31, 2018, or such other date as Colson and Province Brands may mutually agree. The LOI also contemplates other material conditions precedent to the closing of the acquisition, including the completion by Province Brands of a concurrent financing to raise aggregate gross proceeds of minimum $5-million, customary due diligence, compliance with all applicable regulatory requirements, and receipt of all necessary regulatory, corporate, third party, board and shareholder approvals being obtained.
Province Brands expects to complete a private placement of Series A unsecured, 8 per cent convertible notes for gross proceeds of up to $11.5-million.
The common shares of Colson are currently halted from trading and the trading of common shares of Colson is expected to remain halted pending completion of the acquisition.
If and when a definitive agreement between the corporation and Province Brands is executed, the corporation will issue a subsequent press release in accordance with the policies of the TSX-V containing the details of the definitive agreement and additional terms of the acquisition including information relating to sponsorship, summary financial information in respect of Province Brands and additional information with respect to the concurrent financing, convertible note financing, history of Province Brands, and the proposed directors, officers and insiders of the resulting issuer upon completion of the acquisition.