TORONTO, Feb. 13, 2019 /CNW/ - Fire & Flower Holdings
Corp. (formerly Cinaport Acquisition Corp. II) (the
"Company") (CPQ.P: TSX-V) is pleased to announce that
it has completed its previously announced qualifying transaction
(the "Transaction") with Fire & Flower Inc. ("Fire
& Flower") as well as the conversion of the subscription
receipts (the "Subscription Receipts") issued in connection
with Fire & Flower's previously announced $36.5 million private placement offering (the
"Offering") co-led by GMP Securities L.P. and AltaCorp
Capital Inc.
The Transaction, which constitutes the Company's "Qualifying
Transaction" (as such term is defined in Policy 2.4 of the TSX
Venture Exchange (the "TSXV") Corporate Finance Manual), was
completed by way of a three-cornered amalgamation, pursuant to
which 11048449 Canada Inc., a wholly owned subsidiary of the
Company, amalgamated with Fire & Flower to form a newly
amalgamated company ("Amalco"), which now holds Fire &
Flower's assets as a wholly-owned subsidiary of the Company. Amalco
shall operate under the name "Fire & Flower Inc.".
In connection with the Transaction, Fire & Flower and the
Company have satisfied the escrow release conditions of the
Offering. The escrowed funds, net of the outstanding cash
commission and expenses payable to the agents (equal to
approximately $1,000,000), has been
released to and as directed by the Company.
In connection with the Transaction, the Company: (a)
consolidated its issued and outstanding common shares on a
10.64814815 to 1 basis (the "Consolidation"); (b) changed
its name to "Fire & Flower Holdings Corp."; (c) continued the
Company into the federal jurisdiction of Canada under the Canada Business
Corporations Act; (d) adopted new By-Law No. 1 and By-Law No.
2; (e) adopted a new stock option plan; (f) amended the Company's
articles to grant the Company certain redemption rights with
respect to the common shares of the Company in order to facilitate
compliance with applicable licensing regulations; and (g) appointed
UHY McGovern Hurley LLP as the new auditors of the Company.
Pursuant to the Transaction, the Company acquired all of the
outstanding shares of Fire & Flower and issued one common share
of the Company to Fire & Flower's shareholders in exchange for
each common share of Fire & Flower so acquired (aggregate of
100,988,153 common shares).
Upon completion of the Transaction (after giving effect to the
conversion of the Subscription Receipts), the Company has
102,434,413 shares issued and outstanding, with approximately
98.59% held by former Fire & Flower shareholders and
approximately 1.41% held by former Cinaport shareholders, on an
undiluted basis. Additionally, the Company has: (a) $5,800,000 principal amount of non-interest
bearing unsecured convertible debentures; and (b) $20,000,000 principal amount of 8.0% unsecured
convertible debentures, issued and outstanding.
The Company has received conditional approval for the
Transaction from the TSXV and its common shares are expected to
commence trading on the TSXV under the ticker symbol "FAF" at the
commencement of trading on Tuesday, February
19, 2019.
Following closing of the Transaction, the incumbent directors
and officers of the Company (other than Donald Wright and Avininder Grewal in their
capacity as directors) tendered their resignations and the board of
directors of the Company is now comprised of the following
individuals: Trevor Fencott, Harvey
Shapiro, Norman Inkster,
Sharon Ranson, Donald Wright and Avininder Grewal. In
addition, (a) Trevor Fencott has
been appointed as the Chief Executive Officer, President and
Corporate Secretary; (b) Harvey
Shapiro has been appointed as executive director; (c) Nadia
Vattovaz has been appointed as Chief Financial Officer; and (d)
Mike Vioncek has been appointed as Chief Operating Officer.
Full details of the Transaction and certain other matters are
set out in the filing statement of the Company dated February 6, 2019 (the "Filing Statement").
A copy of the Filing Statement can be found under the Company's
SEDAR profile on SEDAR at www.sedar.com.
Conversion of Fire & Flower Subscription Receipts and
Escrow Release
As previously announced, Fire & Flower completed the
Offering for gross proceeds of $36,500,001. In connection with the closing of
the Transaction, the 24,333,334 Subscription Receipts issued
pursuant to the Offering were automatically converted into
24,333,334 common shares of Fire & Flower. Pursuant to the
Transaction, each common share of Fire & Flower has been
exchanged for one common share of the Company.
The Offering was co-led by GMP Securities L.P. and AltaCorp
Capital Inc. as joint bookrunners.
Options
In addition, the board of director of the Company has also
approved the granting of 1,795,000 options (the "Options")
to certain directors, officers, employees and advisors of the
Company, including: (i) 500,000 Options to Nadia Vattovaz (Chief Financial Officer); (ii)
30,000 Options to Norman Inkster
(director); (iii) 30,000 Options to Sharon
Ranson (director); (iv) 30,000 Options to Donald Wright (director); and (v) 30,000 Options
to Avininder Grewal (director). Subject to compliance with the
policies of the TSXV, such Options are exercisable at a price of
$1.50 per share for a period of five
years.
About Fire & Flower Holdings Corp.
The Company, through its wholly-owned subsidiary Fire &
Flower, is an independent retail chain that offers cannabis
products and accessories to the adult-use market in provinces where
the sale of cannabis by private retailers is legal under: (a) An
Act respecting cannabis and to amend the Controlled Drugs and
Substances Act, the Criminal Code and other Acts (the
"Cannabis Act") which came into effect on October 17, 2018; and (b) applicable provincial
regimes for regulating the sale of cannabis by licensed private
retailers. Fire & Flower was founded by leading legal cannabis
entrepreneurs in Canada, with
significant combined experience in launching premium, successful
businesses with extensive experience in the legal cannabis
space.
Fire & Flower has obtained provincial licences to operate
seven cannabis retail stores in Alberta, and two cannabis retail stores in
Saskatchewan, and a wholesale
cannabis supply business in Saskatchewan, and is pursuing additional
licences to operate stores in British
Columbia, Alberta,
Saskatchewan, Manitoba and Ontario.
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING
INFORMATION: This news release includes certain
"forward-looking statements" under applicable Canadian securities
legislation. Forward-looking statements include, but are not
limited to, statements with respect to and the business and
operations of the Company. Forward-looking statements are
necessarily based upon a number of estimates and assumptions that,
while considered reasonable, are subject to known and unknown
risks, uncertainties, and other factors which may cause the actual
results and future events to differ materially from those expressed
or implied by such forward-looking statements. Such factors
include, but are not limited to: final approval of the TSXV of the
Transaction, compliance with extensive government regulation, the
general business, economic, competitive, political and social
uncertainties; delay or failure to receive board, shareholder or
regulatory approvals; the results of operations and such other
matters as set out in the Filing Statement available on the
Company's profile on SEDAR at www.sedar.com. There can be no
assurance that such statements will prove to be accurate, as actual
results and future events could differ materially from those
anticipated in such statements. Accordingly, readers should not
place undue reliance on forward-looking statements.
Investors are cautioned that forward-looking information is
not based on historical facts but instead reflects management's
expectations, estimates or projections concerning future results or
events based on the opinions, assumptions and estimates of
management considered reasonable at the date the statements are
made. Although the Company believes that the expectations reflected
in such forward-looking information are reasonable, such
information involves risks and uncertainties, and undue reliance
should not be placed on such information, as unknown or
unpredictable factors could have material adverse effects on future
results, performance or achievements of the Company.
Should one or more of these risks or uncertainties
materialize, or should assumptions underlying the forward-looking
information prove incorrect, actual results may vary materially
from those described herein as intended, planned, anticipated,
believed, estimated or expected. Although the Company has attempted
to identify important risks, uncertainties and factors which could
cause actual results to differ materially, there may be others that
cause results not to be as anticipated, estimated or intended. The
Company does not intend, and does not assume any obligation, to
update this forward-looking information except as otherwise
required by applicable law.
Neither the TSX Venture Exchange nor its Regulation
Services Provider (as that term is defined in the policies of the
TSX Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release.
SOURCE Fire & Flower Inc.