Heritage Cannabis Holdings Corp. completed its acquisition of all issued and outstanding shares of cannabidiol oil manufacturer Purefarma Solutions Inc.
Under the deal, Vancouver, Canada-based Heritage Cannabis issued 33,333,333 shares to Kelowna, Canada-based Purefarma's shareholders at 19.5 Canadian cents per share.
Heritage will also issue additional common shares to certain Purefarma shareholders if gross margin targets are achieved over the next 4 calendar years beginning in 2019. A maximum of 21,100,000 Heritage shares can be issued, which can be achieved if Purefarma earns C$100 million in cumulative gross margin by Dec. 31, 2023.
The Canadian medical cannabis company will pay annual royalty based on the fiscal year's gross margin, which the royalty set at 12% for the first year, 9% on the second year, 6% on the third year and 3% on the fourth.