Mercal Capital amends LOI with Vitality CBD
MERCAL CAPITAL Corp. has amended its letter of intent with Vitality CBD Natural Health Products Inc. (formerly known as Serenity CBD Canada Inc.), a corporation incorporated under the Canada Business Corporations Act.
On Feb. 26, 2018, Mercal announced that it had entered into a letter of intent dated Feb. 22, 2018, with Vitality by which Mercal would purchase from Vitality shareholders all of the issued and outstanding shares in the capital of Vitality in consideration for the issuance to Vitality shareholders of a certain number of common shares in the capital of Mercal. The parties had intended that the proposed transaction would constitute Mercal’s qualifying transaction as defined in Policy 2.4 of the policies of the TSX Venture Exchange. Instead of proceeding with the qualifying transaction, the letter of intent has been amended such that Mercal shall delist from the NEX board of the TSX-V and Vitality will merge with Mercal in consideration of the issuance to Mercal shareholders of a certain number of common shares in the capital of Vitality in the same proportion (subject to the dilutive effect of financings, stock option issuances and other transactions completed by Vitality which have diluted all the shareholders of Vitality equally on a pro rata basis.) as expressed in the initial letter of intent. The sole reason to delist from the NEX is Mercal’s management’s desire to complete the transaction contemplated by the amended letter of intent for the clear benefit it provides to Mercal shareholders.
Under the proposed terms of the transaction contemplated by the amended letter of intent:
• Approximately 3,992,390 shares are to be issued to Mercal shareholders, which shall equal 2.92 per cent of the issued and outstanding shares of Vitality on a fully diluted basis (which percentage was originally expressed to be 5.0 per cent in the letter of intent dated Feb. 22, 2018, but has been diluted by a series of financings, stock option issuances and other transactions which have been completed by Vitality since that time which have diluted all the shareholders of Vitality equally on a pro rata basis) or 0.6796 common share of Vitality for each one common share of Mercal;
• All fully vested stock options of Mercal shall be converted into stock options of Vitality. Upon the closing of the transactions contemplated by the amended letter of intent, the expected process of distribution to the Mercal shareholders of their common shares of Vitality is by letter of transmittal. Completion of the transactions contemplated by the amended letter of intent is to occur prior to and as a condition precedent of the transaction between Vitality and LiveWell Canada Inc. as described in a press release issued by LiveWell and filed on SEDAR on Dec. 3, 2018, such that following the completion of transaction between Vitality and LiveWell, the current shareholders of Mercal will own shares of LiveWell.
Mike Caswell condensed this news release ([email protected]watch.com).
Brian Martin Baker, Antonio F Cruz, Francis Michael Hunter Gleeson, Timothy Joseph McCunn, Michael Peter Mueller, Calvin Ralph Stiller
(MUL) Shares: 6,975,000