Nabis Holdings Inc. (CSE:NAB) has announced that its Arizona subsidiary, Nabis AZ has entered into a definitive agreement with Verano Arizona, a subsidiary of Verano Holdings Corp. for transfer of the management and governance of Perpetual Healthcare Inc. (PHI) which operates the Emerald Dispensary in Phoenix, Arizona to Verano Arizona.
Under the terms of the agreement, Nabis AZ will assign the management rights associated with PHI to Verano Arizona, and the Nabis appointed director of PHI will appoint certain Verano representatives as directors of PHI, and will subsequently resign. The substantive effect of these transactions is equivalent to the sale of all of Nabis’ right, title, and interest in the Emerald Dispensary to Verano Arizona.
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In consideration of the transaction, Nabis AZ will receive US$11.25 million in cash, US$11.25 million in Class A subordinate voting shares of Verano (priced at the ten-day volume-weighted average price of the shares), and a contingent consideration of up to US$6.125 million subject to the performance of the shares in the ten-day period immediately following the signing of the agreement.
Closing of the deal is subject to certain consents on the part of Nabis’ senior unsecured noteholders and certain regulatory approvals, among other customary closing conditions, and is expected to occur late in the first quarter of 2021.
In a separate statement, Nabis also reminded former holders of its 8% unsecured subordinated convertible debentures that, under its recently implemented Proposal to Creditors, they are entitled to receive their pro-rata share of $23,000,000 in new 5.3% senior unsecured notes and 3,700,000 new common shares of the company.
In order to receive their pro-rata share of the new securities, the company added, the noteholders must execute and deliver a Certificate of Status and Letter of Transmittal to Odyssey Trust, the company’s transfer agent, by 5.00pm EST on March 1, 2021.
If holders do not complete the Certificate of Status and return it to the trustee, they will not receive their pro-rata share of the new securities, which will rather be aggregated and sold by an agent appointed by the company and the holders will receive a pro-rata share of the cash proceeds from such sale.
Nabis Holdings is a Canadian investment issuer that invests in assets across multiple industries, including real property and the US and international cannabis sector.
Contact the author at jon.hopkins@proactiveinvestors.com