Heritage Cannabis Holdings Corp. (CSE:CANN) (OTCQX:HERTF) is launching twenty new products that will be available in the Ontario cannabis market through the Ontario Cannabis Store (“OCS”) and retailers in the province. New products include flower, pre-roll, vape, edible and concentrates products.
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 from the OCS. 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,” stated David Schwede, CEO of Heritage. “We are consistently delivering disruptors to the market and have a strong pipeline of new SKU development under way.”
On the advice of the company’s compensation committee, the decision has been made to award certain executive employees and consultants 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. As such, the parties have collectively agreed to convert the $391,000 owed to them into common shares in the capital of the company.
Pursuant to the terms of the debt settlement agreements, the company has issued 7.1 million 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 3.74 million of the settlement shares were issued to officers, directors and insiders of the company, the issuance of the settlement shares 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 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.
Photo by Tim Foster on Unsplash
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