Update: Atlas Blockchain to Acquire Isracann Biosciences Inc. and Complete Concurrent Financing for Up to $15 Million
THIS NEWS RELEASE IS NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES FOR DISSEMINATION IN THE UNITED STATES
VANCOUVER, British Columbia, Nov. 16, 2018 (GLOBE NEWSWIRE) — Atlas Blockchain Group Inc. (CSE: AKE) (XFRA: A49) (OTCPINK: ATLEF) (the “Company” or “Atlas”) today provides an update detailing term particulars concerning a proposed concurrent financing as previously announced on October 11, 2018 in respect to its entry into a non-binding letter of intent dated October 8, 2018 (the “Letter Agreement”) between the Company and Isracann Biosciences Inc. (“Isracann”), a private British Columbia company.
Operationally located in Israel, Isracann aims to embark on an industrial-scale cannabis farming enterprise targeting both domestic and international commercial opportunities. With three (3) agreements in-place, the venture holds rights to over 580,000 square feet of prime agricultural land with preexisting production permits equivalent to Canadian ACMPR cultivation licensing. Israel has been a leader in cannabis research for over 50 years and further enjoys extremely favorable climatic conditions, both of which strategically factor into premium product development opportunities. Proximally located to Europe’s undersupplied markets ideally situates Isracann with potential access to a consumer base, which based on population alone, is larger than the size of the USA and Canada combined.
The Letter Agreement contemplates a proposed business combination transaction (the “Acquisition”) pursuant to which the Company will acquire all the issued and outstanding common shares of Isracann in exchange for common shares of the Company (the “Atlas Shares”). The Acquisition is an arm’s length transaction and is expected to constitute a fundamental change under the policies of the Canadian Securities Exchange (the “CSE”).
Prior to the closing of the Acquisition, Atlas will complete a non-brokered offering of subscription receipts of the Company (the “Subscription Receipts”) at $0.17 per Subscription Receipt for gross proceeds of at least $5,000,000 to a maximum of $15,000,000 (the “Offering”). Each Subscription Receipt will entitle the holder to receive, upon satisfaction of certain escrow release conditions, and without payment of additional consideration, one unit in the capital of the Company (each, a “Unit”). Each Unit will be comprised of one Atlas Share (pre-consolidation basis) and one Atlas Share purchase warrant (each, a “Warrant”) (pre-consolidation basis). Each Warrant will entitle the holder thereof to acquire one Atlas Share at $0.34 per Atlas Share for two years following the date of issuance.
The Company may complete a portion of the Offering pursuant to conditions described in Multilateral CSA Notice 45-318 – Prospectus Exemption for Certain Distributions through an Investment Dealer (“CSA 45-318”) and the corresponding instruments, orders and rules implementing CSA 45-318 in the participating jurisdictions (collectively with CSA 45-318, the “Investment Dealer Exemption”). In accordance with the Investment Dealer Exemption, the Company advises that, as at the date hereof, there is no material fact or material change in respect of the Company that has not been generally disclosed.
Closing of the Offering is subject to a number of conditions, including receipt of all necessary corporate and regulatory approvals, including the approval of the CSE.
All securities issued in connection with the Offering will be subject to a statutory hold period of four months plus a day from the date of issuance in accordance with applicable securities laws. A finder’s fee may be paid in connection with the Offering to eligible arm’s length finders in accordance with CSE policies. The aggregate net proceeds from the Offering will be used to complete the Acquisition and to provide general working capital.
This news release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any state in which such offer, solicitation or sale would be unlawful. None of the securities to be issued pursuant to the Acquisition or the Offering have been or will be registered under the U.S. Securities Act of 1933, as amended (the “U.S. Securities Act”), or any state securities laws, and any securities issued pursuant to the Acquisition and the Offering are anticipated to be issued in reliance upon available exemptions from such registration requirements pursuant to Rule 506(b) of Regulation D and/or Section 4(a)(2) of the U.S. Securities Act and applicable exemptions under state securities laws. In addition, the securities to be issued pursuant to the Acquisition and the Offering under an exemption from the registration requirements of the U.S. Securities Act will be “restricted securities” as defined under Rule 144(a)(3) of the U.S. Securities Act and will contain the appropriate restrictive legend as required under the U.S. Securities Act. Any public offering of securities of Atlas to be made in the United States must be made by means of a prospectus containing detailed information about Atlas and management, as well as financial statements.
About Isracann Biosciences Inc.
Isracann, is an Israeli-based cannabis company, focused on becoming a premier cannabis producer offering low-cost production targeting undersupplied, major European marketplaces. Based in Israel’s agricultural sector, Isracann will leverage its development within the most experienced country in the world with respect to cannabis research. The company has secured agreements with three (3) licensed Israeli producers for medicinal marijuana cultivation.
ON BEHALF OF THE BOARD OF DIRECTORS
Chief Executive Officer
The CSE does not accept responsibility for the adequacy or accuracy of this release.
All statements, other than statements of historical fact, included herein are forward-looking statements that involve various risks and uncertainties. There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements. Important factors that could cause actual results to differ, materially from the Company’s expectations are disclosed in the Company’s documents filed from time to time with the Canadian Securities Exchange, the British Columbia Securities Commission, the Ontario Securities Commission, the Alberta Securities Commission, and the Alberta Securities Commission.