VANCOUVER, BRITISH COLUMBIA--(Marketwired - May 15, 2014) - West Point Resources Inc. (TSX VENTURE:WPO) (the "Company") is pleased to announce it has entered into a binding letter of intent ("LOI") with Cannabix Breathalyzer Inc. ("Cannabix") dated May 13, 2014, which is developing a cutting edge marijuana breathalyzer for use by law enforcement to test for drug-impaired drivers, in particular drivers who are impaired due to the use of marijuana.
Cannabix's drug-impairment recognition system is based on breath testing technology that has been developed in Sweden and has been clinically researched and proven to be successful in testing individuals for recent consumption of the THC component of marijuana. Cannabix is advancing its products to enable law enforcement personnel to use this technology to enhance detection of marijuana impaired driving offences on North American roads at a time when marijuana is becoming legal in many jurisdictions. Cannabix holds patent applications on leading edge technology to breath test for marijuana impairment. West Point will be acquiring 100% of the exclusive North American licensing rights to Cannabix's technology.
Terms of the transaction
The LOI contemplates the company paying 7.5 million common shares to Cannabix for the exclusive licensing of the Cannabix Breathalyzer and issuing 7.5 million warrants exercisable at $0.075, exercisable for one year.
The company intends to raise a minimum $500,000 via a non-brokered financing at $0.05 cents per unit. Each Unit consists of one common share and one-half of one non-transferable common share purchase warrant exercisable at $0.10 cents per common share for a period of 12 months from the date of closing. All warrants are subject to an early acceleration provision which provides for the mandatory exercise or expiry of the Warrants in the event West Point's shares close at $0.13 or higher for at least 10 consecutive trading days. In such event, the Warrants will accelerate and expire 30 days after the Company has given notice of the accelerated conversion to the Warrant holders. Finders' fees may be payable in connection with the private placement in accordance with exchange policies.
As conditions of closing, along with minimum $500,000 financing required to be raised, Cannabix will nominate two members to the Board of Directors of the company.
Additional milestone payments
The LOI contemplates future share payments upon reaching the following milestones: The issuance of 7,500,000 of common shares of West Point within 14 business days of production of prototype of product. Furthermore, upon receipt of the final patent, the company will issue 5,000,000 common shares of West Point.
About Cannabix Breathalyzer Inc.
Cannabix Breathalyzer Inc is privately held medical device company that has developed a drug-testing device that can detect Tetrahydrocannabinol (THC- the psychoactive component of marijuana that causes intoxication) using breath samples. The science behind the breath-testing device is based on breath testing technology developed at the Karolinska University in Sweden and perfected by the founders of Cannabix Breathalyzer Inc. The device provides rapid detection of THC and can be used roadside to identify drivers intoxicated by the use of marijuana. The device can also be useful for other practical applications such as testing employees in the workplace where intoxication by THC can be hazardous.
The founders and current shareholders of Cannabix Breathalyzer include:
Mr. Kal Malhi:
Mr. Malhi is a Vancouver-based entrepreneur and the founder of Cannabix Breathalyzer Inc. Mr. Malhi is a retired member of the Royal Canadian Mounted Police and is also President of BullRun Group, a private investment company specializing in early stage business development. Mr Malhi brings a wealth of business and law enforcement experience to the management team and is cognizant of the issues of protecting individuals' rights to privacy while maximizing public safety through law enforcement initiatives.
Dr. Raj Attariwala:
Dr. Attariwala, MD, PhD, FRCPC, FANM is a Vancouver based dual board certified Radiologist and Nuclear Medicine physician certified in both Canada and the United States. He holds a doctorate in Biomedical Engineering from Northwestern University (Evanston, IL).
Dr. Attariwala has worked closely with the breath testing technology developed by the Karolinska Institute and Dr. Olof Beck and utilized his educational training and background in biomedical engineering to formulate product design and patent applications for Cannabix Breathalyzer products. Dr. Attariwala also has several other medical device patents under developments in the field of nuclear medicine.
Dr. Bruce Goldberger:
Bruce A. Goldberger, PhD, DABFT, is the director of University of Florida Health Forensic Medicine, a professor, and the director of toxicology for the Department of Pathology, Immunology and Laboratory Medicine in the College of Medicine at the University of Florida
He also performs as the technical and administrative director of the University of Florida Forensic Toxicology Laboratory, which provides toxicological services to medical examiner offices and state and local law enforcement agencies throughout the state. In his other roles, Dr. Goldberger is the editor-in-chief of the Journal of Analytical Toxicology; the president of the American Board of Forensic Toxicology; and was a past-president of the American Academy of Forensic Sciences.
Halt in trading
The transaction will constitute an arm's length change of business ("COB" as defined in the policies of the TSX Venture Exchange) of West Point. Upon completion of the transaction, it is expected that the company will be classified as a technology company.
Trading of West Point shares on the TSX Venture will remain halted until the transaction is completed. The company intends to delist from the TSX Venture Exchange and apply for a listing on the Canadian Securities Exchange (the CSE). Completion of the transaction is subject to a number of conditions, including shareholder approval, among other conditions. The transaction cannot close until the required shareholder approval is obtained. There can be no assurance that the transaction will be completed as proposed or at all.
Investors are cautioned that, except as disclosed in the Management Information Circular and/or Filing Statement to be prepared in connection with the transaction, any information released or received with respect to the COB may not be accurate or complete and should not be relied upon. Trading in the securities of West Point should be considered highly speculative.
The TSX Venture Exchange has in no way passed upon the merits of the proposed transaction and has neither approved nor disapproved the contents of this press release.
We seek Safe Harbor.
On behalf of the Board of Directors
Rav Mlait, President and CEO
West Point Resources Inc.
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.