Trius Extends Deadline for Business Combination with Starling Brands Inc.
NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES
FREDERICTON, New Brunswick, Dec. 17, 2019 (GLOBE NEWSWIRE) — Trius Investments Inc. (“Trius”) (TSXV:TRU.H) is pleased to provide the following updates on its proposed business combination (the “Transaction”) with Starling Brands Inc. (“Starling”).Transaction UpdatesThe following amendments have been made to the business combination agreement dated July 8, 2019, as amended September 30, 2019 (the “Agreement”), among Trius, Starling, and Trius’ wholly-owned subsidiary, 11436465 Canada Inc.The deadline for the completion of the Transaction was extended from December 31, 2019 to March 31, 2020.If the Agreement is terminated by Starling in order to accept an alternative acquisition proposal, Starling has agreed to pay Trius a higher termination fee of C$200,000.Starling and Trius are pleased with the progress made to date, notwithstanding delays resulting from challenging capital markets conditions. Both parties continue to work diligently towards satisfying the outstanding conditions to the completion of the Transaction.Other Starling Business UpdatesOver the past several weeks, Starling has advanced or completed a number of important commercial milestones, including:Starling has now entered into a brand licensing agreement for its newly-developed Cerius line of topical CBD products, in partnership with a well-known cosmetics industry veteran, for distribution in the United Kingdom and the European Union, and will be distributing their THC topicals through dispensaries in California commencing in Q1 2020. Pursuant to the brand licensing agreement, Starling shall sell such products at cost plus 12% plus a 10% royalty. The agreement will continue in effect unless and until terminated for cause due to breaches of material obligations, bankruptcy or the deliberate disclosure of confidential information by either party.
Starling is negotiating a distribution agreement for the retail distribution of its Jayden’s Juice line of products through hundreds of dispensaries throughout the State of California.Management CommentaryJoel Freudman, Trius’ President and CEO, commented, “Starling’s growth and commercial development reinforces our continued confidence in the Starling business and team. We have agreed to a further extension of the Transaction deadline to allow opportunities for the completion of a concurrent financing on terms more favourable than are available under current junior capital market conditions.”Mr. Freudman added, “We thank our shareholders for their patience and continued support during this process, which has unfortunately been delayed due to ongoing market weakness for venture issuers, both in cannabis and in other sectors. We remain confident that the Transaction, when completed, will provide exceptional value for our shareholders, both on account of Starling’s rapidly-growing California cannabis extraction operations, and the premium valuation that we have negotiated for their Trius shares.”Further details regarding Starling and the Transaction are available in Trius’ press releases dated April 15, 2019; July 9, 2019; September 9, 2019; and November 26, 2019.For further information please contact:Trius Investments Inc.
President and Chief Executive Officer
Telephone: (647) 880-6414Starling Brands Inc.
Media Relations and Investor Relations:
Telephone: (647) 556-0430
IR@StarlingBrands.comIn accordance with TSX Venture Exchange (“TSXV”) policy, the common shares of Trius are currently halted from trading and are expected to remain halted until Trius is delisted from the TSXV. Completion of the Transaction is subject to a number of conditions including, but not limited to, Canadian Securities Exchange (“CSE”) acceptance and receipt of applicable corporate approvals. There can be no assurance that the Transaction will be completed as proposed or at all.Investors are cautioned that, except as disclosed in the management information circular of Trius dated August 8, 2019 or the listing statement of Starling to be prepared in connection with the Transaction, any information released or received with respect to the Transaction may not be accurate or complete and should not be relied upon.Neither the TSXV nor the CSE has in any way passed on the merits of the Transaction, and neither has approved nor disapproved the contents of this press release.Neither the TSXV nor the Regulation Services Provider (as that term is defined in the policies of the TSXV) accepts responsibility for the adequacy or accuracy of this release.All information contained in this press release with respect to Trius and Starling was supplied by the parties respectively for inclusion herein, and each party has relied entirely on the other party for any information concerning the other party. Trius does not assume any responsibility for the accuracy or completeness of the information provided by Starling.This press release does not constitute an offer to sell or a solicitation of an offer to sell any of the securities described herein in the United States. The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the “U.S. Securities Act”) or any state securities laws, and may not be offered or sold within the United States or to U.S. persons unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.Caution Regarding Forward-Looking InformationThis press release includes statements containing forward-looking information that reflect the current views and/or expectations of management of Trius and Starling, respectively, with respect to performance, business, partnerships and future events, and the timing thereof, including but not limited to expressed or implied statements and assumptions regarding Starling’s ongoing business initiatives such as its Cerius topicals line, distribution prospects, and the completion of the Transaction as proposed or at all. Forward-looking information is based on the current expectations, beliefs, assumptions, estimates and forecasts about the business and the industry and markets in which Trius and Starling respectively operate. Statements containing forward-looking information are not guarantees of future performance and involve risks, uncertainties and assumptions, which are difficult to predict, and which are outside of Trius’ control. In particular, there is no guarantee that Starling will be able to achieve its business objectives on the terms agreed or at all; that all conditions to completion of the Transaction will be satisfied; that the parties will be able to consummate the Transaction on the terms in the Agreement (as amended) or at all; or Starling’s business or financial market performance following completion of the Transaction. Actual results may differ materially from those projected in the forward-looking information. Accordingly, readers should not place undue reliance on forward-looking statements and information herein, which are qualified in their entirety by this cautionary statement. The forward-looking information contained in this press release is provided as of the date of this press release, and neither Trius nor Starling undertakes any obligation to release publicly any revisions for updating any forward-looking statements made herein, except as required by applicable securities laws.