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DOJA Cannabis to merge with TS Brandco

DOJA Cannabis Company Ltd signed a binding letter of intent to acquire TS Brandco Holdings Inc., a Canada-based cannabis lifestyle brand.

Under the deal, the company will acquire the outstanding shares of TS Brandco in exchange for DOJA shares. The combined company will be known as Hiku Brands Co. Ltd.

The boards of both companies have approved the proposed merger.

DOJA Trent Kitsch will serve as president, with TS Brandco CEO Alan Gertner serving as CEO of the combined company.

The letter of intent currently contemplates the parties entering into a definitive agreement before Jan. 15, 2018, and completing the merger by no later than March 31, 2018, unless otherwise agreed by the parties.

Also, the deal is subject to requisite regulatory approvals, including the approval of the Canadian Securities Exchange, requisite TS Brandco shareholder approval and standard closing conditions, including the approval of the definitive agreement by the boards of the respective companies and completion of due diligence investigations to the satisfaction of each of the parties.

In connection with the transaction, Aphria Inc. and Uji Capital committed to invest C$12.5 million in Hiku Brands through the purchase of 8,992,805 DOJA subscription receipts on a non-brokered private placement basis at C$1.39 apiece.

The subscription receipts are automatically convertible to Hiku Brands units. Each unit will consist of one common share and one common share purchase warrant of Hiku Brands, with each warrant exercisable for C$2.10 apiece.