Canntab Therapeutics Limited, an innovator in cannabinoid and terpene blends in hard pill form for therapeutic applications, is pleased to announce that it has entered into a binding asset purchase agreement to acquire certain cannabis-processing equipment and leasehold improvements located at its 223 Riviera Drive, Markham, Ontario facility from CMAX Technologies Inc., a related party of the Company for $1,018,000.
The purchase price of the CMAX Assets was based upon third party valuations ordered by Canntab. The purchase price will be satisfied through the issuance of 1,996,078 common shares of the Company at a deemed price of $0.51 per Common Share. A deposit of 200,000 Common Shares will be paid to CMAX within 14 days of the execution of the purchase agreement.
The Company has also entered into a binding asset purchase agreement with Pharmagenerics Solutions Inc. to purchase cannabis-processing equipment owned by Pharma . The purchase price of the Pharma Assets of $300,000 will be satisfied through the issuance of 588,235 Common Shares at a deemed price of $0.51 per Common Share. Joshi Laxminarayan, Chief Scientific Officer of the Company is the sole officer, director and shareholder of Pharma. The binding asset purchase agreement replaces a letter of intent that Mr. Laxminarayan and the Company had entered into in March of 2020, and the deemed price of the Common Shares issuable to Mr. Laxminarayan were determined by reference to then-current closing price of $0.50 per share. This corresponds as well to the $0.50 unit financing completed at the same time.
The CMAX Transaction will constitute a related party transaction under Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions (“MI 61-101“), but is otherwise exempt from the formal valuation and minority approval requirements of MI 61-101. The CMAX Transaction has been approved by the independent director of the Company.
Richard Goldstein, Chief Financial Officer and Director of the Company is a shareholder and the sole director and officer of CMAX Technologies Inc. In addition, Jeffrey Renwick, Chief Executive Officer and Director of the Issuer, Barry Polisuk, Secretary and Director of the Issuer, and Joshi Laxaminarayan , Chief Scientific Officer of the Issuer are shareholders of CMAX Technologies Inc. Mr. Polisuk holds 1.44% of CMAX’s outstanding common shares, Mr. Goldstein holds 11.19%, Mr. Renwick holds 38.83% and Mr. Laxminarayan holds 18.04%.
Canntab Therapeutics is a Canadian biopharmaceutical company focused on the manufacturing and distribution of a suite of hard pill cannabinoid formulations in multiple doses and timed-release combinations.