- A supply agreement that builds on the existing supply agreement for the dried flower between Aphria and Tokyo Smoke that adds high-quality cannabis oil to the list of products Aphria will white label for the Tokyo Smoke brand; and,
- The issuance of 0.8 million units in Hiku, on the same terms as the equity investment, to Aphria in exchange for entering the supply agreement.
In addition to the agreement noted above, Aphria and Hiku are currently in the process of finalizing the following, to take affect once DOJA's wholly-owned subsidiary receives its license to sell cannabis under the ACMPR:
- A supply agreement whereby Aphria will have access to DOJA's premium West Coast cannabis;
- A tolling agreement whereby Aphria will process cannabis oil for Hiku using dried cannabis supplied by DOJA;
- A distribution agreement whereby Aphria will have access to Hiku's independent retail locations in provinces where private licenses will be granted; and
- DOJA will leverage Aphria's distribution network to sell branded cannabis. DOJA's subsidiary has requested a pre-sales license inspection from Health Canada, the last step prior to issuance of a sales license under the ACMPR.
- The share value for Aphria's equity is $1.39, priced at the 5-day VWAP (volume weighted average price) as of today's market close. As a result, Aphria would receive 7,194,244 common shares in Hiku;
- Aphria will receive a full warrant for each common share it receives, exercisable for a two-year period, priced at $2.10, a 50% premium to the share value of its investment on the date of announcement; and,
- The warrant maintains a forced conversion feature, for the benefit of Hiku, priced at $3.05 or 120% premium on the share value of Aphria's investment.
Forward-looking statements contained in this news release are expressly qualified by this cautionary statement.SOURCE Aphria Inc.