Maple Leaf Green World Inc. (MGWFF)

[John-Knee]

Maple Leaf Green World Inc. Enters into a Letter of Intent to Acquire A Production License in Clark County, Nevada
2018-11-20 06:30:19 AM ET (GlobeNewswire)
   
   
Maple Leaf Green World Inc. ("Maple Leaf" or the "Company") (NEO: MGW, OTCQX: MGWFF) is pleased to announce that it has expanded its interests in Nevada by entering into a letter of intent ("LOI") to acquire 100% interest of a Clark County, Nevada Medical and Recreational Production Certificates (the "License") from a private Las Vegas, Nevada based company (the "Vendor"). The Vendor holds one Medical Production Certificate and one Recreational Production Certificate granted by the State of Nevada for the Clark County.

The purchase price of USD $4,000,000 (the "Purchase Price") is comprised of a combination of cash and issuance of common shares of Maple Leaf, as described in further detail below. The terms of the agreement are for Maple Leaf to pay to vendor an initial cash deposit of USD $100,000 (the "Initial Deposit") within 30 business days from November 14, 2018, being the date of execution of the LOI, and upon satisfactory completion of due diligence on the Vendor by the Company. Upon completion of due diligence, Maple Leaf through its wholly owned subsidiary, SSGW LLC ("SSGW") and the Vendor shall enter into a formal Purchase and Sale Agreement.

A further payment of USD $900,000 ($400,000 in cash and $500,000 by way of issuance of common shares of Maple Leaf at 10% discount to the then market price) is payable within 30 business days after the License is transferred to SSGW and a location of SSGW's choice in Clark County, Nevada, provided that the applicable approval by the appropriate authorities in Nevada is obtained. The Vendor will still hold 15% of the License, and SSGW will hold 85% of the interest in the License until Maple Leaf pays off to the Vendor the remaining USD $3,000,000 between October 1, 2019 to December 31, 2019 in a combination of cash and issuance of common shares of Maple Leaf, as agreed by the parties at that time.

Once the total amount of USD $4,000,000 is paid, the Vendor shall transfer the remaining 15% of interest in the License to SSGW. In the event the License cannot be transferred, or the location cannot be approved at the fault of the Vendor, the Vendor shall return the Initial Deposit within 5 business days upon confirmation of such non-transferable condition. In the event Maple Leaf fails to fulfil its payment obligations, Maple Leaf upon demand by the Vendor, shall surrender its interest in the License to the Vendor.

Maple Leaf has also agreed to pay Monsoon Group of Las Vegas, LLC who acted as a consultant for the LOI a fee of five (5%) of the Purchase Price that is paid cash; and six (6%) percent of the Purchase Price paid in shares of Maple Leaf, at 10% discount to the then market price, on the date the fee become due and payable, subject to the approval of NEO Exchange.

The transaction is also subject to applicable statutory, regulatory, and compliance laws of Nevada and applicable securities laws of Canada.

This acquisition complements the Company's currently held cultivation license in Henderson, Nevada with a vertical integration expansion. As this production License has no limited capacity, and no tie to a specific cultivation license, the Company can produce a variety of Cannabis products with capacity as allowed by the physical facility. The Company is intended to lease a warehouse space in the non-incorporated Clark County area to start up the production as soon as the License is transferred.

Raymond Lai, CEO of Maple Leaf said, "We are excited about this latest proposed acquisition, as it will allow us to sell a variety of Cannabis products, rather than just dry flowers, if completed. And we can source out our own supply of raw material without waiting for our own cultivation facility to be completed. We anticipated that we will be able to start generating revenue from this production license soon after the transfer of the License to our name and to our location is done."