Under a recent call for new products, Heritage submitted products from their diverse portfolio for consideration by the OCS, twenty of which have received notice to purchase (NTP) from the OCS, an outstanding result for the Heritage product team. Heritage expects the new products to be available in Ontario in fall of this year.
“Our product innovation team continues to hit it out of the park, creating exceptional products that have ‘forever SKU’ potential,” said David Schwede, CEO of Heritage. “We are consistently delivering disruptors to the market and have a strong pipeline of new SKU development under way.”
Additionally, Heritage announces that on the advice of the Company’s compensation committee, the decision has been made to award certain executive employees and consultants (the “Parties”) a total of $391,000 based on the performance of those individuals in 2021, and the Company’s revenue in the most recent fiscal quarter.
The Parties have elected to receive common shares in the capital of the Company in lieu of cash as consideration for their bonuses pursuant to the terms of certain debt conversion and exchange agreements (collectively, the “Debt Settlement Agreements”). As such, the Parties have collectively agreed to convert the $391,000 owed to them into common shares in the capital of the Company (the “Settlement Shares”).
Pursuant to the terms of the Debt Settlement Agreements, the Company has issued 7,109,090 Settlement Shares to the Parties at a price of $0.055 per Settlement Share, calculated based on the 5-day volume-weighted average price of the Company’s common shares for the period immediately prior to the execution of the Debt Settlement Agreements. The Settlement Shares were issued in reliance on certain prospectus exemptions available under National Instrument 45-106 – Prospectus Exemptions, and are subject to a four month and one day statutory hold period.
As 3,745,454 of the Settlement Shares were issued to officers, directors and insiders of the Company, the issuance of the Settlement Shares (the “Debt Settlement”) constituted a “related party transaction” pursuant to Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions (“MI 61-101”). The Company relied on exemptions from the formal valuation and minority approval requirements of MI 61-101 (pursuant to subsections 5.5(a) and 5.7(a)) as the fair market value of the securities distributed to, and the consideration received from, the related party did not exceed 25% of the Company’s market capitalization. The Debt Settlement was approved by the Company’s board of directors. No special committee was established in connection with the Debt Settlement or the participation of the applicable officers and directors in the Debt Settlement, and no materially contrary view or abstention was expressed or made by any director of the Company in relation thereto.
About Heritage Cannabis Holdings Corp.
Heritage Cannabis is a leading cannabis company offering innovative products to both the medical and recreational legal cannabis markets in Canada and the U.S., operating under two licensed manufacturing facilities in Canada. The company has an extensive portfolio of high-quality cannabis products under the brands Purefarma, Pura Vida, RAD, Premium 5, feelgood., the CB4 suite of medical products in Canada and ArthroCBD in the U.S.
ON BEHALF OF THE BOARD OF DIRECTORS OF HERITAGE CANNABIS HOLDINGS CORP.
The Canadian Securities Exchange has neither approved nor disapproved the contents of this news release.