TORONTO, Aug. 28, 2019 /CNW/ PRESS RELEASE - TerrAscend Corp. today announced the signing of definitive agreements for a series of transactions to purchase ABI SF, LLC, which operates a Bay Area cannabis cultivation facility and owns the State Flower brand. State Flower is known for its ultra-premium cannabis flower and is currently sold through dispensaries in California and Nevada, including The Apothecarium. TerrAscend recently closed a series of transactions with The Apothecarium as noted in the Company's press release of June 6, 2019. By agreeing to purchase State Flower and bring aboard elite cultivation talent, TerrAscend will continue to provide high quality product through its retail locations and will expand the State Flower brand in multiple states
TerrAscend has agreed to initially acquire 49.9% of the equity of State Flower for total consideration of US$2.85M from conversion of a previously issued convertible debenture and subject to regulatory approvals.
TerrAscend has also extended a line of credit of up to US$3.75M to State
Flower for cultivation facility improvements to expand production
capacity. While State Flower implements facility improvements, the
parties will begin the regulatory approval process for the full purchase of
State Flower, under a Securities Purchase Agreement. TerrAscend also has
future rights to use the State Flower brand pursuant to a license agreement.
TerrAscend has agreed to purchase the remaining 50.1% equity of State Flower
for total consideration based on future revenue over a predetermined
twelve-month period. The transaction is subject to regulatory approvals
by various local and state authorities, as well as certain customary closing
conditions. Several of the owners of The Apothecarium and their related
entities have an ownership interest in State Flower.
"We're excited to add the prestigious State Flower brand to our
portfolio," said Matthew Johnson, President of TerrAscend Corp., and
TerrAscend USA, Inc. "Daniel Wacks and Jeremy Cohen are skilled cannabis
cultivators with years of experience operating in a highly regulated market and
we are thrilled to work with them to expand the State Flower facilities and
brand presence. "
"Through our work with The Apothecarium and TerrAscend, it's clear that
we've found a great strategic and cultural fit," said Daniel Wacks,
President of State Flower. "We're proud of the brand we've built and
excited to have found a partner who recognizes the quality of our team. We look
forward to working together to build best-in-class cultivation capabilities in
all jurisdictions where TerrAscend operates, to expand the State Flower brand
presence, and become part of an inspirational team that's making major progress
towards becoming one of the top companies in the sector."
