April 06, 2015 09:03 ET
Saratoga's (CSE:ABA) Wholly-Owned Subsidiary Abba Medix Signs Letter of Intent to Acquire Redecan, a Health Canada MMPR Licensed Producer, for CDN $11,000,000 in Cash and Shares.
TORONTO, ONTARIO--(Marketwired - April 6, 2015) - Abba Medix Corp., ("Abba Medix", a wholly-owned subsidiary of Saratoga Electronic Solutions Inc., "Saratoga", or the "Company") (CSE:ABA) is pleased to report that it has entered into a Letter of Intent with 9037136 Canada Inc., operating and known as Redecan Pharm ("Redecan"), a Health Canada licensed producer and distributor of medical marijuana.
Redecan is focused on developing premium quality medical marijuana products and is a licensed producer and seller, able to cultivate marijuana under the Marihuana for Medical Purposes Regulations ("MMPR") in Canada.
The principal focus of Redecan is the production of marijuana from its fully-secured, 15,000 square foot greenhouse production facility in Niagara, Ontario. Redecan obtained a medical marijuana license to undertake the production of medical marijuana in July 2014, and in March 2015 was awarded its sales license. Abba Medix and Redecan shall review, count, and determine the value of Redecan's product inventory immediately following the Closing. Redecan estimates that there is currently 114.7kg of product inventory.
Redecan is currently listed as one of the seventeen companies in Canada to obtain such a license to date.
Under the terms of the LOI, Abba Medix shall pay to Redecan an aggregate consideration of CDN $11,000,000, payable in cash and shares of the Company, subject to negotiation of the Definitive Agreements.
The LOI is non-binding and is expected to be superseded by a Definitive Agreement to be agreed to and signed between the parties. The Transaction is subject to regulatory approval and standard closing conditions.
Further details about this transaction and the combined entity will be provided in a comprehensive press release when the parties complete the Definitive Agreement.
About Abba Medix Corp.
Abba Medix Corp., a wholly-owned subsidiary of Saratoga Electronic Solutions Inc. (CSE:ABA), was established in August 2013 to capitalize on the dramatically changing rules governing medical marijuana production in Canada. We submitted our initial application under the MMPR licensing program in November of 2013. Our 19,000 sq. ft. Pickering, Ontario growing facility, with an output capacity of 115 kg per month, is complete and ready for Health Canada inspection. We are currently awaiting approval from Health Canada to produce medical cannabis. For more information please visit www.abbamedix.com.
Cautionary Statements Regarding the Transaction
This press release contains forward-looking information based on current expectations. The closing of the Transaction, the expected terms of the Transaction, the cash disbursement and the number of securities of the Company and / or Redecan that may be issued in connection with the Transaction and the parties' ability to satisfy the closing conditions and receive all necessary approvals are all forward-looking information. These statements should not be read as guarantees of future performance or results. Such statements involve known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements to be materially different from those implied by such statements. Although such statements are based on management's reasonable assumptions, there can be no assurance that the Transaction will occur or that, if the Transaction does occur, it will be completed on the terms described above. The terms described above are not binding unless and until the Definitive Agreement is signed.
Cautionary Statements Regarding Forward-Looking Information
Certain statements within this press release relating to the Company and / or Redecan constitute "forward-looking statements", within the meaning of applicable securities laws, including without limitation, statements regarding future estimates, business plans and / or objectives, sales programs, forecasts and projections, assumptions, expectations, and/or beliefs of future performance, are "forward-looking statements". Such "forward-looking statements" involve known and unknown risks and uncertainties that could cause actual and future events to differ materially from those anticipated in such statements. Forward- looking statements include, but are not limited to, statements with respect to commercial operations, including production and / or sales of medical marijuana, quantities of future medical marijuana production, anticipated revenues in connection with such sales, the overall projected size of the market, completion and / or expansion of production facilities, and other information that is based on forecasts of future results, estimates of production not yet determinable, and other key management assumptions. Actual results may differ materially from those expressed or implied by such forward-looking statements and involve risk and uncertainties relating to the Company's and Redecan's historical experience with medical marijuana operations, regulatory changes, timeliness of government approvals for the granting of permits and licenses, changes in medical marijuana prices, actual operating performance of facilities, and other uninsured risks. The Company assumes no responsibility to update or revise forward-looking information to reflect new events or circumstances unless required by law. Further, there can be no assurance that Abba Medix's medical marijuana license application will be approved by Health Canada, or that any prospective projects in the industry will be successfully completed. Neither the CSE nor its Regulation Services Provider (as that term is defined in the policies of the CSE) accepts responsibility for the adequacy or accuracy of this release.
Ray Ahmad Rasouli
Chief Executive Officer
Saratoga Electronic Solutions Inc. / Abba Medix Corp.