Re­ward­stream to ac­quire EuroMed Ther­a­peu­tics
Mr. Pa­trick Mor­ris re­ports6 May 2019

RE­WARD­STREAM SOLUTIONS Inc. has en­tered into a let­ter of in­tent, dated ef­fec­tive April 30, 2019, pur­suant to which it pro­poses to ac­quire all of the out­stand­ing share cap­i­tal of EuroMed Ther­a­peu­tics Ltd. EuroMed is an arm’s-length company, es­tab­lished un­der the laws of the Province of Bri­tish Columbia, in­volved in the cul­ti­va­tion and ex­port­ing of med­i­cal-grade cannabis pro­duced in green­house fa­cil­i­ties lo­cated in Is­rael. EuroMed aims to be a lead­ing low-cost, high-qual­ity, med­i­cal-grade cannabis pro­ducer in Is­rael with a fo­cus on both the do­mes­tic Is­raeli mar­ket and the emerg­ing Euro­pean cannabis mar­ket.

EuroMed, through its wholly owned Is­raeli sub­sidiary, Euro­cann Agritech Ltd., owns a 74-per-cent eq­uity stake in a 269,098square-foot (25-dunam) cannabis des­ig­nated cul­ti­va­tion prop­erty lo­cated 45 min­utes out­side of Jerusalem, Is­rael. EuroMed in­teads to build a 22,000-square-foot green­house fa­cil­ity on the prop­erty to cul­ti­vate med­i­cal-grade cannabis for the pur­poses of ser­vic­ing the do­mes­tic med­i­cal cannabis mar­ket and ex­ports into Europe. EuroMed will be work­ing with lead­ing green­house en­gi­neer­ing and con­struc­tion firm Eisen­berg Agri company (Is­rael) Ltd. (EACi) to de­sign and build a state-of-the-art mod­u­lar green­house fa­cil­ity with ex­pected com­ple­tion by March, 2020.

In ac­cor­dance with the terms of the trans­ac­tion, the company pro­poses to con­sol­i­date its out­stand­ing share cap­i­tal on a one-for-two ba­sis, and is­sue 40 mil­lion post­share consolidation com­mon shares to the share­hold­ers of EuroMed in ex­change for all of the out­stand­ing share cap i tal of EuroMe d. Fol­loi­wng com­ple­tion of the share consolidation, and the is­suance of the con­sid­er­a­tion shares, the co m pany is ex­pected to have ap­prox­i­mately 48,741,562 com­mon shares out­stand­ing. At this time, the is­suance of the con­sid­er­a­tion shares to the share­hold­ers of EuroMed is not ex­pected to re­sult in the cre­ation of any new in­sid­ers or con­trol per­sons of the company.

Prior to clos­ing of the trans­ac­tion, the company in­tends to ap­ply to list its com­mon shares on the Cana­dian Se­cu­ri­ties Ex­change and vol­un­tar­ily delist its shares from the TSX Ven­ture Ex­change. On clos­ing of the trans­ac­tion, it is an­tic­i­pated that the company will change its name to EuroMed Ther­a­peu­tics Ltd., and will re­con­sti­tute its board and man­age­ment to con­sist of mem­bers mu­tu­ally agree­able to the company and EuroMed. In con­nec­tion with com­ple­tion of the trans­ac­tion, the company in­tends to un­der­take a non-bro­kered pri­vate place­ment of sub­scrip­tion re­ceipts to raise not less than $2.5-mil­lion. The company will pro­vide ad­di­tional in­for­ma­tion re­gard­ing the terms of the fi­nanc­ing as soon as it be­comes avail­able. In con­nec­tion with the trans­ac­tion, the company an­tic­i­pates is­su­ing four mil­lion post­share consolidation com mon shares to an arm’s-length third party who as­sisted in in­tro­duc­ing the trans­ac­tion to the company. All se­cu­ri­ties is­sued in con­nec­tion with the trans­ac­tion, and the fi­nanc­ing, will be sub­ject to a four-month-an­done-day statu­tory hold pe­riod.

Com­ple­tion of the trans­ac­tion re­mains sub­ject to a num­ber of con­di­tions, in­clud­ing the com­ple­tion of sat­is­fac­tory due dili­gence, the ne­go­ti­a­tion and fi­nal­iza­tion of de­fin­i­tive doc­u­men­ta­tion, re­ceipt of any re­quired reg­u­la­tory and third party con­sents, ap­proval of mi­nor­ity share­hold­ers of the company to the delist­ing of the company’s com­mon shares from the TSX Ven­ture Ex­change, com­ple­tion of the share consolidation, com­ple­tion of the fi­nanc­ing, the Cana­dian Se­cu­ri­ties Ex­change hav­ing con­di­tion­ally ac­cepted the listing of the company’s com­mon shares, the TSX Ven­ture Ex­change hav­ing con­sented to the vol­un­tar­ily delist­ing of the company’s com­mon shares, and the sat­is­fac­tion of other cus­tom­ary clos­ing con­di­tions. The trans­ac­tion can­not close un­til the re­quired ap­provals are ob­tained, and the company’s com­mon shares have been delisted from the TSX Ven­ture Ex­change. There can be no as­sur­ance that the trans­ac­tion will be com­pleted as pro­posed or at all, or that the company’s com­mon shares will be listed and posted for trad­ing on any stock ex­change. Trad­ing in the company’s com­mon shares is cur­rently sus­pended and it is an­tic­i­pated that trad­ing will re­main sus­pended un­til com­ple­tion of the trans­ac­tion.

Fur­ther in­for­ma­tion re­gard­ing the trans­ac­tion, in­clud­ing the terms of the fi­nanc­ing, a de­tailed use of pro­ceeds for the fi­nanc­ing, fi­nan­cial in­for­ma­tion of EuroMed, and de­tails re­gard­ing the pro­posed board and man­age­ment of the company fol­low­ing com­ple­tion of the trans­ac­tion will be made avail­able in due course. Read­ers are en­cour­aged to re­view the listing state­ment, which will be pre­pared by the company in con­nec­tion with the listing of the company on the Cana­dian Se­cu­ri­ties Ex­change, and which will be made avail­able un­der the company’s pro­file on SEDAR.

We seek Safe Har­bor.

Ge­of­frey Balder­son, David Dal­ton, Pa­trick Clarence Mor­ris

(REW) Shares: 17,483,081

https://www.pressreader.com/canada/stockwatch...5760128384