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CALGARY, June 12, 2018 /CNW/ - Aldershot Resources
Ltd. ("Aldershot" or
the "Company") (TSXV: ALZ) is pleased to announce its
transition to Solo Growth Corp.™, a premiere retail cannabis
distributor in Western Canada, and
to announce: (i) a non-brokered private placement of up to an
aggregate of $20.0 million,
provided that the Company shall be entitled to increase the size of
the private placement to $25.0
million as a result of excess demand (the "Private
Placement"); (ii) the appointment of a new management team (the
"New Management Team") and new board of directors (the
"New Board") in connection with the completion of the
Private Placement; and (iii) subject to regulatory approval, a
rights offering (the "Rights Offering") to holders of common
shares ("Common Shares") of Aldershot (collectively, the
"Transaction").
Private Placement
Pursuant to the Private Placement, up to an aggregate of
400,000,000 Common Shares and units ("Units") of
Aldershot will be issued at a
price of $0.05 per Common Share or
Unit, as applicable, for aggregate gross proceeds of $20.0 million.
Units will be issued to subscribers that are to become members
of the New Management Team and the New Board. Common Shares will be
issued to all other subscribers. The completion of the Private
Placement is expected to occur on or about June 28, 2018 (the "Closing").
Each Unit will be comprised of one Common Share and one
performance-based Common Share purchase warrant (each, a
"Performance Warrant"). Each Performance Warrant will
entitle the holder to purchase one Common Share at a price of
$0.05 for a period of five
years. The Performance Warrants will vest and become exercisable as
to one-third upon the 20-day volume weighted average trading price
of the Common Shares (the "Market Price") equaling or
exceeding $0.10, an additional
one-third upon the Market Price equaling or exceeding $0.125 and a final one-third upon the Market
Price equaling or exceeding $0.15. In
addition, in the event the Market Price equals or exceeds
$0.175, each Performance Warrant
shall be exercisable for 1.5 Common Shares, provided that, at the
time of exercise in respect of the additional 0.5 of a Common Share
per Performance Warrant (the "Performance Incentive"), the
Common Shares are listed on the facilities of a recognized stock
exchange (other than the TSX Venture Exchange (the "TSXV")),
the Common Shares are acquired for cash or for the securities of a
company listed on a recognized stock exchange (other than the
TSXV).
The resignation of the current board of directors and management
team of Aldershot and the
appointment of the New Management Team and the New Board will occur
contemporaneous with the Closing.
New Management Team
The New Management Team will be led by Pali Bedi as President
and Chief Executive Officer, Jas
Hans, as Vice President, Operations and Stephanie Bunch as Vice President, Finance and
Chief Financial Officer.
The members of the New Management Team include founding
shareholders, senior officers and board members of Canada's largest private liquor retailer, Solo
Liquor Stores Ltd. ("Solo Liquor") collectively have more
than 50 years of regulated substance retail experience. The New
Management Team has operational expertise in the regulated retail
liquor market, robust customer and real estate analytics and
strong, collaborative and constructive relationships with
municipalities and regulators across Alberta and landlords across Western Canada.
Pali Bedi,
Director, President
and Chief Executive Officer
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Mr. Bedi has 22 years
of experience in the controlled substance retail market having
served as the Chief Executive Officer of Solo Liquor since 1996.
Mr. Bedi was integral in growing Solo Liquor from 8 to 62 stores
since 2010, which now sees over 20,000 customers per day in over 30
municipalities across Alberta. Mr. Bedi brings 30 years of
commercial real estate experience and has been a Principal at
Avison Young Real Estate Alberta for 18 years, specializing in
retail development. Mr. Bedi has developed, leased and successfully
sold in excess of 1.0 million square feet of retail, office and
industrial real estate spanning five communities in Alberta
throughout his career.
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Jasbir (Jas)
Hans
Vice President,
Operations
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Mr. Hans has served
as the President of Solo Liquor since 1996, establishing 62
operating stores in 30 communities throughout Alberta. Mr. Hans has
extensive experience in human resource management, the development
and implementation of strategic direction and establishing
financial goals, budgets, corporate objectives and professional
development.
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Stephanie A.
Bunch
Vice President,
Finance and Chief Financial Officer
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Ms. Bunch is a
Chartered Accountant with over 25 years industry experience with a
focus on public company mergers and acquisitions and capital
markets. Ms. Bunch was the Vice President, Business Performance and
Finance Lead, Mergers and Acquisitions of Centrica Energy (Direct
Energy Marketing Limited) from 2013 to 2017 and the Chief Financial
Officer and Vice President, Finance of Seaview Energy Inc., from
2006 to 2012. Prior to Seaview Energy Inc., Ms. Bunch held
progressively senior roles including Controller, Acting CFO and
Treasurer at Ketch Energy Ltd., Acclaim Energy Trust and Canetic
Resources Trust between 2000 and 2006. Beginning her career at a
leading international accounting firm, KPMG LLP, Ms. Bunch has been
directly involved in over $3 billion of public and private company
mergers, acquisitions and integrations throughout her career, from
startups through to multi-national deals.
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Sanjib (Sony)
Gill
Corporate Secretary
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Mr. Gill is a partner
at McCarthy Tétrault LLP, a national law firm. Mr. Gill has dealt
with all aspects of a public and private company's creation,
growth, restructuring and value maximization. Mr. Gill has
extensive experience in the negotiation, structuring and
consummation of a broad range of corporate finance, securities and
mergers and acquisitions. He serves on the board of directors of,
and acts as corporate secretary to, numerous public and private
companies. Mr. Gill was acknowledged as a Top 40 Under 40 by
Lexpert.
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New Board of Directors
Upon closing of the Transaction, the New Board will be comprised
of Pali Bedi, Richard McHardy,
Ron Hozjan,
Sonny Mottahed, Michael Stark and James
Miller.
The directors have extensive experience in successfully
founding, growing and monetizing public companies.
Richard
McHardy
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Mr. McHardy has been
a founder of several public companies and has extensive experience
in leadership positions and over 20 years' experience in all
aspects of securities and mergers and acquisitions. Mr. McHardy has
been instrumental in a number of significant transactions
including: (i) a founder and the President and Chief Executive
Officer of Spartan Energy Corp. from December 10, 2013 to May 28,
2018 when it was acquired for approximately $1.4 billion by
Vermilion Energy Inc.; (ii) a founder and the President and Chief
Executive Officer of Spartan Oil Corp. from March 2011 to January
2013 when it completed a business combination with Bonterra Energy
Corp. for a total transaction value of approximately $480 million;
(iii) a founder and the President and Chief Executive Officer of
Spartan Exploration Ltd., from January 2008 to June 2011 when it
completed an arrangement with a public senior oil and gas company
in a transaction valued at approximately $244 million; and (iv) a
founder and the President of Titan Exploration Ltd. prior to its
acquisition by Canetic Resources Trust for approximately $116
million. Mr. McHardy has served as corporate secretary for a number
of public companies and was a partner at McCarthy Tétrault LLP,
where he practiced securities and corporate law.
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Ron Hozjan
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Mr. Hozjan has been
Vice President, Finance and Chief Financial Officer of Tamarack
Valley Energy Ltd. ("Tamarack"), a public company listed on
the Toronto Stock Exchange, since 2010. Mr. Hozjan is a Chartered
Professional Accountant with over 30 years of oil and gas
experience and over 20 years of experience as a senior financial
officer. Prior to Tamarack, Mr. Hozjan served as the Chief
Financial Officer of Vaquero Resources Ltd., which was acquired by
RMP Energy Ltd. Prior thereto, he was the Vice President, Finance
and Chief Financial Officer at a predecessor firm, Vaquero Energy
Ltd., which grew successfully before merging with Highpine Oil
& Gas Limited. Previously, Ron held various senior finance
positions at Storm Energy Ltd., Beau Canada Exploration Ltd. and
Renaissance Energy Ltd.
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Shahin (Sonny)
Mottahed
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Mr. Mottahed is the
co-founder and Chief Executive Officer of 51st Parallel Life
Sciences Ltd. ("51st Parallel"), an Alberta-based,
pre-production applicant to become a licensed provider of cannabis
focused on the recreational market. 51st Parallel has a strategic
relationship and technical services agreement with LivWell
Enlightened Health LLC, a vertically integrated cannabis company.
Mr. Mottahed is also the President and Chief Financial Officer of
Target Capital Inc. d.b.a. CBi2 Capital, a publicly listed company
that develops and manages a diversified portfolio of predominantly
early stage cannabis investment opportunities. Mr. Mottahed brings
significant senior leadership and financial expertise to the
Canadian cannabis market. Mr. Mottahed is currently the Chief
Executive Officer and Managing Partner of Black Spruce Merchant
Capital, a corporate finance advisory firm based in Calgary. Prior
thereto, Mr. Mottahed was the Managing Director, Investment
Banking at Raymond James Ltd. in Calgary where he was instrumental
in raising $4.0 billion in capital over 4 years.
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Michael
Stark
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Mr. Stark is an
independent businessman and previously a certified financial
planner. He was the Chairman of Spartan Energy Corp. from December
10, 2013 to May 28, 2018. Prior thereto, Mr. Stark was the Chairman
of Spartan Oil Corp. from June 2011 to January 2013 and the
Chairman of Spartan Exploration Ltd. from January 2008 to June
2011. Mr. Stark was also the Chairman of Titan Exploration Ltd.
from August 2004 until December 2007. Mr. Stark has served on the
audit committee of several public issuers.
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James
Miller
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Mr. Miller is the
President of Boarder Capital Inc., a commercial real estate focused
private equity firm. Mr. Miller has over 25 years' experience in
the investment and commercial real estate business, starting his
career at CBRE Group where he achieved the title of Vice President
and Top Producer very early in his career. Mr. Miller joined an
international private equity fund from 1998 to 2002 focused on
commercial and multi-residential real estate assets. During his
time at the private equity fund, Mr. Miller assisted in
redeveloping and repositioning value add assets throughout Canada
and the United States. Mr. Miller has directly participated in over
$1.5 billion worth of commercial real estate transactions including
foreign, pension fund, REIT and private capital investments. Mr.
Miller joined Avison Young in 2004 becoming "Top Producer of the
Year" in 2005, 2006, 2007 and 2011. During his tenure with Avison
Young, Mr. Miller led the Calgary Capital Markets Group, and was
active as a senior leader of the company's national Capital Markets
Group as well as sitting on the National Executive
Committee.
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New Management and the New Board will be participating in the
Private Placement. Upon completion of the Private Placement, the
New Management Team and the New Board's ownership interest is
expected to be approximately 46% on a fully diluted basis
(including the Performance Incentive). The Private Placement will
not result in the creation of a new control person.
Corporate Strategy
The New Management Team and New Board have extensive controlled
substance retail experience and public company expertise and
believe the current market provides an excellent opportunity to
transform Aldershot into a
sustainable cannabis retailer.
The New Management Team intends to use the net proceeds from the
Private Placement to establish and launch a leading retail cannabis
business in Western Canada. The New Management Team expects
to execute the corporate strategy by capitalizing on its collective
experience in the following areas: (i) controlled substance retail
market; (ii) an understanding of consumer purchasing habits and
provincial demographics from historical data; (iii) leveraging
existing relationships with landlords, municipalities and
regulators; (iv) expertise tailoring product brands and retail
experience; and (v) operational know-how including store sizing,
site development, inventory management, staffing, training and cost
structure.
Assuming the Private Placement is fully subscribed, the proceeds
will provide the New Management Team a platform to grow a
sustainable retail cannabis business in Western Canada with a goal to open over 60
retail cannabis locations across Alberta in the next three years. Proceeds from
the Private Placement will be used to fund licenses, lease and
develop retail properties and for general working capital
purposes.
The retail cannabis locations are anticipated to be operated
under the name "Yellow Submarine By Solo"™. Please see Exhibit
1 for an illustration of the Yellow Submarine By Solo logo.
Upon completion of the Transaction, it is anticipated that the
shareholders of Aldershot will be
asked to approve, at a special meeting called for such purpose, a
change of the name of the Company to "Solo Growth Corp."™.
Shareholders holding not less than 50.1% of the issued and
outstanding Common Shares have approved the Transaction by way of
written resolution. Completion of the Transaction is subject to
customary closing conditions, including the approval of the
TSXV. Pursuant to the policies of the TSXV, the execution of
the new corporate strategy is deemed to represent a "Change of
Business" with respect to the Company. The Company intends to
submit all requisite filings with the TSXV in due course.
Rights Offering
Upon completion of the Private Placement, Aldershot shareholders will be entitled to
participate in the Rights Offering, which is expected to be
conducted by way of a rights offering circular. Pursuant to the
Rights Offering, each shareholder as of the record date for such
offering (the "Record Date") will be issued one right
("Right") for each Common Share held on the Record Date,
entitling that holder to purchase one Common Share for every four
Rights held at a price of $0.05 per
Common Share at or before the expiry time of the Rights Offering,
following which all outstanding Rights shall terminate and expire.
Subscribers under the Private Placement will have a right to
participate in the Rights Offering with respect to any Common
Shares acquired pursuant to the Private Placement.
Members of the New Management Team and New Board will be
entitled to purchase one Unit for every four Rights held at a price
of $0.05 per Unit at or before the
expiry time of the Rights Offering.
About Aldershot Resources Ltd.
Upon completion of the Transaction, the Company will execute a
new retail-focused cannabis business strategy. The Transaction has
received unanimous approval from the board of directors of
Aldershot.
There are currently 53,697,733 Common Shares, 12,000,000 share
purchase warrants and 4,350,000 stock options of Aldershot issued and outstanding. Pursuant to
the Transaction, all outstanding options of Aldershot shall be exercised or cancelled
prior to Closing. Assuming the exercise of all existing stock
options and share purchase warrants, there will be approximately
70,047,733 Common Shares outstanding at Closing.
Upon completion of the Private Placement and assuming the
exercise of all Rights issued in connection with the Rights
Offering, there will be approximately 587,559,666 Common Shares
outstanding, and assuming the exercise of all Performance Warrants
(including the Performance Incentive) issued in connection with the
Private Placement (assuming the New Management Team and the New
Board acquires 120,000,000 Units in the Private Placement), there
will be up to approximately 767,559,666 Common Shares outstanding
on a fully diluted basis. As appropriate, New Management will
consider a share consolidation in due course.
Forward-Looking and Cautionary Statements
This news release may include forward-looking statements
including opinions, assumptions, estimates, the New Management
Team's assessment of future plans and operations, and, more
particularly, statements concerning the completion of the
Transaction, the number of securities issued by way of the Private
Placement, the business plan of the New Management Team, including
future retail cannabis locations, the change of name of the
Company, use of proceeds following completion of the Transaction
and statements concerning a potential share
consolidation. When used in this document, the words "will,"
"anticipate," "believe," "estimate," "expect," "intent," "may,"
"project," "should," and similar expressions are intended to be
among the statements that identify forward-looking
statements. The forward-looking statements are founded on the
basis of expectations and assumptions made by Aldershot which include, but are not limited
to, the timing of the receipt of the required regulatory and third
party approvals, the future operations of, and transactions
completed by Aldershot as well as
the satisfaction of other conditions pertaining to the completion
of the Transaction. Forward-looking statements are subject to
a wide range of risks and uncertainties, and although Aldershot believes that the expectations
represented by such forward-looking statements are reasonable,
there can be no assurance that such expectations will be
realized. Any number of important factors could cause actual
results to differ materially from those in the forward-looking
statements including, but not limited to, regulatory and third
party approvals not being obtained in the manner or timing
anticipated by Aldershot, changes
to cannabis laws, the timing of the legalization of recreational
cannabis, the availability of cannabis-retail products from
licensed producers, the ability to implement corporate strategies,
the state of domestic capital markets, the ability to obtain
financing, changes in general market conditions and other factors
more fully described from time to time in the reports and filings
made by Aldershot with securities
regulatory authorities. Except as required by applicable laws,
Aldershot does not undertake any
obligation to publicly update or revise any forward-looking
statements.
Completion of the Transaction is subject to a number of
conditions, including but not limited to, TSXV acceptance. There
can be no assurance that the Transaction will be completed as
proposed or at all. Trading in the securities of
Aldershot should be
considered highly speculative.
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 news release.
SOURCE Aldershot Resources Ltd.