Trees Enters Into Definitive Agreement to Acquire Camp Cannabis Retail Stores in Ontario

TORONTO – Trees Corporation (NEO: TREE), a next-now cannabis company at the intersection of community, content, and commerce, is pleased to announce that it its wholly-owned indirect subsidiary, OCH Ontario Consulting Corp. has entered into an agreement to purchase all of the issued and outstanding shares of Barnard Cann Ltd. from the shareholders of Camp pursuant to the terms of a share purchase agreement dated the date hereof among the shareholders of Camp and OCH. Camp owns and operates licenced retail cannabis businesses at three Ontario locations in Burlington, Milton and Kanata, with a fourth location in Gloucester expected to open soon.

Michael Klein, CEO of Trees, stated: “Camp locations across Ontario allow the TREES brand to expand our retail footprint as we build upon our strategy of being best at engaging the ‘cannabis curious’ consumer.”

Jeff Holmgren, President and CFO of Trees, stated: “The definitive agreement with Camp is a crucial step and the beginning of our planned growth strategy through accretive consolidation.”

Transaction Details

The purchase price is approximately $780,000, of which approximately $707,000  is to be satisfied on the closing date by the issuance of a demand note in favour of a representative of the Vendors. Immediately following the closing of the Transaction, the Vendor Representative shall demand payment on the Demand Note and direct OCH to pay such amount over to Trees, and cause Trees to:

1. 1. 1. Issue to the Vendors in accordance with their proportionate interests, an aggregate of up to 2,380,000 common shares in the capital of Trees, of which 75% of such Consideration Shares shall be subject to an escrow agreement pursuant to which 1/3 of such shares will be released on the six month anniversary of the closing date and the remaining 2/3 released on the twelve month anniversary of the closing date; and
      2. Issue to the Vendor Representative an unsecured convertible debenture in the amount of $350,000 payable to the Vendors in accordance with their proportionate interests, which Convertible Debenture shall bear interest at 7.5% compounding annually, payable monthly in cash, shall mature on the second anniversary of the closing date, and which shall allow for the principal owing thereunder to be convertible into common shares in the capital of Trees  at the option of the Vendor Representative, no sooner than the first anniversary of the closing date, at a conversion price being the greater of (X) $0.15, and (Y) the closing price of Trees’ common shares at the close of trading on the date prior to the conversion date, less a 10% discount.

Completion of the proposed Transaction is subject to the satisfaction of certain conditions precedent, including, but not limited to, receipt of all necessary regulatory approvals, including approval of the Alcohol and Gaming Commission of Ontario and the NEO Exchange Inc.

Cautionary Note Regarding Forward-Looking Statements

This press release contains statements that constitute “forward-looking information” (“forward-looking information“) within the meaning of the applicable Canadian securities legislation. All statements, other than statements of historical fact, are forward-looking information and are based on expectations, estimates and projections as at the date of this news release. Any statement that discusses predictions, expectations, beliefs, plans, projections, objectives, assumptions, future events or performance (often but not always using phrases such as “expects”, or “does not expect”, “is expected”, “anticipates” or “does not anticipate”, “plans”, “budget”, “scheduled”, “forecasts”, “estimates”, “believes” or “intends” or variations of such words 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 historical fact and may be forward-looking information. Mr. Holmgren stated “With its high barrier of entry, Trees looks forward to soon solidifying its presence in the BC market through the closing of this transaction as a significant milestone to expanding the highly differentiated Trees brand across Canada.”

Forward-looking statements in this document include, among others, statements relating to the Trees’ expectations regarding the closing of the Transaction, the expected receipt of regulatory approvals, the closing of the transactions contemplated by the APA, expectations regarding the Company’s ability to unlock and capture emerging consumer segments across its platforms, expectations regarding the Company’s ability to engage its customers and new consumer segments and need states, the expectation that the Company will be successful in its growth strategy, and other statements that are not historical facts. By their nature, forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause our actual results, performance or achievements, or other future events, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Such factors and risks include, among others: (a) the Company may require additional financing from time to time in order to continue its operations which may not be available when needed or on acceptable terms and conditions acceptable; (b) compliance with extensive government regulation; (c) domestic and foreign laws and regulations could adversely affect the Company’s business and results of operations; (d) the stock markets have experienced volatility that often has been unrelated to the performance of companies and these fluctuations may adversely affect the price of the Company’s securities, regardless of its operating peers; (e) adverse changes in the public perception of cannabis; (f) the impact of COVID-19; and (g) general business, economic, competitive, political and social uncertainties. Accordingly, readers should not place undue reliance on the forward-looking information contained in this press release.

The forward-looking information contained in this news release represents the expectations of the Company as of the date of this news release and, accordingly, is subject to change after such date. Readers should not place undue importance on forward-looking information and should not rely upon this information as of any other date. The Company undertakes no obligation to update these forward-looking statements in the event that management’s beliefs, estimates or opinions, or other factors, should change.

The NEO Exchange has neither approved nor disapproved the contents of this press release and accepts no responsibility for the adequacy or accuracy of this release. 

(This information is primarily sourced from Trees Corporation.  Highly Capitalized has neither approved nor disapproved the contents of this news release. Read our Disclaimer here).