OTTAWA, August 30, 2021 (GLOBE NEWSWIRE) – HEXO Corp (“HEXO” or the “Company”) (TSX: HEXO; NASDAQ: HEXO) is pleased to announce the completion of the previously announced acquisition of all shares outstanding from the entities operating the business of Redecan, the largest licensed private producer in Canada (the “Transaction”). On closing, HEXO paid the selling shareholders of Redecan $ 400 million in cash (subject to certain customary closing adjustments) and delivered 69.7 million newly issued common shares of HEXO (the “ counterpart shares ”).
“This is an extraordinary day for the employees, investors, consumers and stakeholders of HEXO and Redecan,” said Sébastien St-Louis, CEO and co-founder of HEXO. This transaction is in line with our growth strategy and will strengthen our leadership position in the cannabis industry in Canada. It will encourage the combined entity in its efforts to become one of the three largest cannabis producers in the world. In addition, it will put us on the right path to achieving a positive BPA. “
In connection with the closing of the transaction, HEXO has entered into an Investor Rights Agreement (the “Investor Rights Agreement”) with certain sellers of Redecan shares in order to provide for certain customary governance rights, including rights. enrollment-on-demand and limited sequentials. A copy of the Investor Rights Agreement will be filed under HEXO’s profile on SEDAR at www.sedar.com. In addition, in accordance with the share purchase agreement entered into as part of the transaction, the resale of the counterpart shares by the sellers of Redecan will be limited during a 24-month holding period during which, subject to with certain exceptions, each Redecan seller will be allowed to sell a maximum of 1/24e the initial amount of its counterpart shares that were issued as part of the transaction. Redecan Sellers also agree to be bound by the usual standstill provisions for a period of 18 months.
As part of the transaction and in accordance with the provisions of the Investor Rights Agreement, Peter James Montour now sits on the Board of Directors of HEXO, which also includes Emilio Imbriglio, Vincent Chiara, Jason Ewart, Adam Miron, Michael Munzar , Sébastien St-Louis and Rose Marie Gage. As part of the investor rights agreement, Will Montour will act as a non-voting observer on the board of directors until his election to the board.
HEXO is an award-winning licensed producer of innovative products for the global cannabis market. HEXO serves the Canadian recreational cannabis market with its portfolio of HEXO, UP Cannabis, Original Stash, Bake Sale, Redecan, Namaste and REUP brands, as well as the medical market in Canada, Israel and Malta. The Company also serves the Colorado market through its Powered by HEXO® strategy and Truss CBD USA, a joint venture with Molson Coors. With the closing of the acquisition of Redecan and the planned closing of the previously announced acquisition of 48North Cannabis Corp., HEXO expects to occupy the number one position in the cannabis products sector in Canada in terms of market share. recreational cannabis. HEXO complies with the laws applicable in the jurisdictions in which it operates.
For more information, visit www.hexocorp.com.
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