Vancouver, British Columbia--(Newsfile Corp. - June 17, 2019) - Brigadier Gold Limited (TSXV: BRG.H) (OTC: BGADF) (the "Corporation") is pleased to announce a proposed change of business from mineral exploration to an investment issuer (the "Proposed COB") under the rules of the TSX Venture Exchange ("TSXV").
Subject to receipt of all regulatory approvals, including approval by the TSXV of the Proposed COB, following completion of the CGA Transaction and NSG Transaction (each, as defined below and referred to collectively herein as the "Transactions"), the Corporation will become a Tier 2 Investment Issuer focused on the high growth hemp, cannabidiol ("CBD") and health and wellness industries in Asia. In connection with the Proposed COB, the Corporation intends to change its name to "Canrim Growth Group Inc."
Ranjeet Sundher, President, Chief Executive Officer and a director of the Corporation, commented: "We are very pleased to announce the proposed change of business to become an Investment Issuer. We see the Asian markets in the health and wellness space, and in particular as it relates to the fledgling CBD product market, as having extremely high growth potential and we are excited to provide our shareholders with exposure to unique investments in this area. We intend to leverage the relationships and expertise of our team to source investments and to create commercial synergies between our portfolio companies, all in the effort of creating long-term shareholder value."
In connection with the Proposed COB, the Corporation has entered into non-binding letters of intent covering investment and commercial arrangements with CBD Group Asia Limited ("CGA") and Natural Source Group Pte Limited ("NSG"), each dated June 15, 2019. Details can be found below under "The Proposed COB Transaction".
About CBD Group Asia Limited
CGA is a Hong Kong company focused on distribution and strategic investment in Asia's high growth CBD markets. Partnering with existing companies and brands in North America and Asia, as well as developing new ones, CGA intends to harness this significant growth opportunity in Asia. CGA will utilise its management team's sales experience and connections in Asia in order to expand and grow into embryonic Asian CBD markets alongside chosen partners. CGA will also, through the availability and sourcing of investment capital through its capital market partners, explore investments and acquisitions of high growth CBD companies based in Asia looking to expand alongside CGA.
About Natural Source Group Pte Limited
NSG is an established innovative product development and sales company with offices in Shanghai, Singapore, London and Rotterdam. NSG's underlying investment thesis is that a fundamental imbalance exists between sources of supply and aggregate demand in China and other areas of the emerging frontiers of Asia. These are particularly accentuated in consumer markets. China is in the midst of shifting its economy off its reliance on exporting and transitioning into a consumption-driven macroeconomic model. It is NSG's purpose to act as a conduit developing consumer focussed products matching this change and to operate in niche health and wellness markets where NSG is able to control the sources of supply in areas of significant regulatory oversight.
James Foster, Chief Executive Officer of CGA and NSG remarked: "We are delighted to partner with Canrim Growth Group as we see Asian markets as being the future for consumer growth globally. Asia represents the next frontier for growth in CBD product development and consumption, an industry which has already experienced hyper growth in North America. We see CGA as being well positioned in the nascent Asian CBD space as a conduit for this hyper growth alongside Canrim. We are also pleased to have Canrim as a shareholder and partner with NSG to bring CBD products across Asia. Asian consumers have traditionally valued North American brands as offering high quality and reliability. With access to these branded materials and techniques we are confident we will be able to help position Canrim and its partners to capitalize on a very significant market opportunity."
The Proposed COB Transaction
In connection with the Proposed COB, the Corporation has entered into non-binding letters of intent with respect to the CGA Transaction and NSG Transaction (each, as defined below).
The CGA Transaction
Following completion of the CGA Transaction, the Corporation will own 50% of CGA and will have the ability to acquire a total of up to 75% of the common shares of CGA (the "CGA Common Shares") following conversion of the Debentures and exercise of the CGA Option in full. In accordance with the terms of the letter of intent with CGA, the Corporation has agreed to acquire on closing (i) 550,000 CGA Common Shares, at a price per CGA Common Share of CAD $1.00, for total subscription proceeds of $550,000; and (ii) 450,000 CGA Common Shares from James Foster in exchange for the issuance of approximately 2,000,000 common shares in the capital of the Corporation, representing a deemed price per CGA Common Share of $1.00, which, combined with the subscription of 550,000 CGA Common Shares, will result in the Corporation owning 50% of the CGA Common Shares on closing of the CGA Transaction.
Further, the Corporation will acquire secured, convertible debentures of CGA in the principal amount of $700,000, which shall be convertible into CGA Common Shares at a price of CAD $1.00 per CGA Common Share (the "CGA Debentures"), and CGA will grant to the Corporation an option to purchase up to 1,300,000 CGA Common Shares for total proceeds of CAD $1,300,000 (the "CGA Option"). The definitive investment agreement will also provide board nomination rights to both CGA and the Corporation, as well as a right of first refusal in favor of the Corporation with respect to any proposed investment by CGA in companies involved in the CBD space in Asia (the "CGA Transaction").
The NSG Transaction
Pursuant to the terms of the letter of intent with NSG, the Corporation has agreed to subscribe for 2,000,000 common shares of NSG at a price per common share of USD $0.10, for total investment proceeds of USD $200,000. In addition, NSG and the Corporation will enter into an agreement requiring that any CBD products distributed by NSG will be exclusively sourced by the Corporation and its investment partners, which may include CGA, in exchange for a royalty granted to the Corporation for a percentage of revenues derived from the sale by NSG of such CBD products and brands. (the "NSG Transaction").
The Proposed COB and the Transactions are arm's length transactions subject to requisite regulatory approval, including the approval of the TSXV. In accordance with the rules of the TSXV, the Corporation does not intend to seek shareholder approval for the Proposed COB, however the Corporation does intend to hold a special meeting of shareholders to approve, among other things: (i) a name change of the Corporation to "Canrim Growth Group Inc."; (ii) a consolidation of the Corporation's outstanding common shares on the basis of one (1) post-consolidation common shares for every one and a half (1 ½) pre-consolidation shares (the "Consolidation"); and (iii) approval of a new long-term equity incentive plan and other matters in connection with its implementation.
In connection with the Proposed COB, the Corporation will complete a private placement offering of units ("Units") or subscription receipts convertible into Units, for aggregate gross proceeds of a minimum of CAD $3,000,000, with each unit being comprised of one common share of the Corporation and one half of common share purchase warrant (the "Offering"). It is expected that both a brokered and non-brokered private placement will be completed as part of the Offering.
Sponsorship of the Proposed COB is required unless an exemption is available or a waiver from this requirement can be obtained in accordance with the policies of the TSXV. The Corporation intends to apply for a waiver to the sponsorship requirement under Policy 2.2 of the TSXV, Sponsorship and Sponsorship Requirements. There is no assurance that a waiver will be granted.
Trading in the common shares of the Corporation has been halted and will remain halted pending the review of the Proposed COB and Transactions by the TSXV.
A more comprehensive news release will be issued by the Corporation disclosing details of the Proposed COB, the names and backgrounds of all persons who will constitute insiders of the resulting issuer following completion of the Proposed COB, details with respect to the Offering, and information respecting sponsorship, once definitive agreements for the Transactions have been finalized and certain conditions have been met, including approval of the Transactions and Proposed COB by the Corporation's board of directors, satisfactory completion of due diligence, and execution of the definitive agreements.
For investment, partnership or other corporate inquiries, please contact email@example.com.
For further information, please contact:
Brigadier Gold Limited
Ranjeet Sundher, President, Chief Executive Officer and Director
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Forward-Looking Information Cautionary Statement
Statements in this press release regarding the Corporation's business which are not historical facts are "forward-looking statements" that involve risks and uncertainties, including that the Proposed COB and the proposed Transactions will be completed on the terms described herein or otherwise, as well as management's expectations with respect to the CBD market in Asia and the benefits to the Corporation which may be implied from such statements. Since forward-looking statements address future events and conditions, by their very nature, they involve inherent risks and uncertainties. Actual results in each case could differ materially from those currently anticipated in such statements.
Completion of the Transaction is subject to a number of conditions, including but not limited to, execution of binding definitive agreements relating to the Transactions and TSXV acceptance. There can be no assurance that the Proposed COB will be completed as proposed or at all.
Investors are cautioned that, except as disclosed in the management information circular or filing statement to be prepared in connection with the Proposed COB, any information released or received with respect to the Proposed COB may not be accurate or complete and should not be relied upon.
The TSX Venture Exchange Inc. has in no way passed upon the merits of the Proposed COB or proposed Transactions and has neither approved nor disapproved the contents of this press release.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this news release.
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