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Australis Capital Inc
Symbol AUSA
Shares Issued 113,143,755
Close 2019-11-29 C$ 0.45
Recent Sedar Documents

Body and Mind investor Australis sells 10M shares

2019-11-29 17:52 ET - News Release

See News Release (C-BAMM) Body and Mind Inc

Mr. Michael Carlotti of Australis reports

EARLY WARNING NEWS RELEASE OF AUSTRALIS CAPITAL INC.

Australis Capital Inc. is disposing 10 million common shares of Body and Mind Inc.

Transfer of shares to Passport Technology Canada Ltd.

On Nov. 29, 2019, Australis announced that it is disposing of five million common shares pursuant to a licence, development and service agreement dated Oct. 29, 2019, between Australis and Passport Technology Canada Ltd. Australis is transferring to Passport five million common shares as part of the consideration payable for certain services and rights under the Passport agreement. Pursuant to the Passport agreement, Passport has agreed to adapt Passport Technology's self-service platform to service the cannabis industry, undertake prototype development and continuing product enhancements, and has granted to Australis exclusive software rights and exclusive use of vendor relationships at cost. The Passport agreement contemplates an exclusive 10-year relationship between the parties.

The Passport shares are being transferred by Australis in consideration for the Passport services at a deemed price of 59.8 U.S. cents per Passport share for total consideration of $2,989,165 (U.S.) or 78 Canadian cents per Passport share for total consideration of $3,902,654 (Canadian) based on an exchange rate of $1.3056 (Canadian) per $1 (U.S.).

Transfer of shares to Astound Group Inc.

On Nov. 29, 2019, Australis announced that it is disposing of five million common shares pursuant to a service agreement dated effective Nov. 20, 2019, between Australis and Astound Group Inc. Australis is transferring to Astound five million common shares as consideration payable for certain services under the Astound agreement. Pursuant to the Astound agreement, Astound has agreed to provide brand optimization services, assist Australis with expanding brand awareness, introduce new products for Australis's existing brands, and provide other marketing and development services for a period of three years.

The Astound shares are being transferred by Australis in consideration for the Astound services at a deemed price of 54.5 U.S. cents per Astound share for total consideration of $2,725,838 (U.S.) or 72.1 Canadian cents per Astound share for total consideration of $3,608,192 (Canadian) based on an exchange rate of $1.3237 (Canadian) per $1 (U.S.).

Prior to the disposition, Australis held 34,873,628 common shares and unsecured convertible debentures of the issuer in the principal amount of $1.6-million, convertible into 2,909,091 common shares at a price of 55 cents per common share. Assuming conversion of all debentures, Australis held approximately 36.1 per cent of the issued and outstanding common shares on a partially diluted basis and approximately 34.2 per cent of the issued and outstanding common shares on a undiluted basis.

After the disposition, Australis holds 24,873,628 common shares and debentures in the principal amount of $1.6-million. Assuming conversion of all debentures, Australis holds approximately 26.5 per cent of the issued and outstanding common shares on a partially diluted basis and approximately 24.4 per cent of the issued and outstanding common shares on a undiluted basis.

Pursuant to a conversion agreement dated July 1, 2019, Australis agreed to convert the debentures into 2,909,091 common shares on July 1, 2020.

Australis acquired the common shares and debentures for investment purposes. In pursuing such purposes, Australis takes a long-term view of its investment. It reserves the right to formulate other plans or make other proposals, and take such actions with respect to its investment in the company. Depending on market conditions and other factors, Australis may acquire additional securities of the company as Australis may deem appropriate, whether in open market purchases, privately negotiated transactions or otherwise. Australis continues to evaluate numerous potential transactions and, in connection therewith, may exchange common shares for other assets or may sell common shares to increase its cash position. Australis may also reconsider and change its plans or proposals relating to the foregoing.

This press release is issued pursuant to early warning requirements of National Instrument 62-104 and National Instrument 62-103, which also require a report to be filed with regulatory authorities in each of the jurisdictions containing additional information with respect to the foregoing matters. A copy of the early warning report will be available under the company's SEDAR profile, and may be obtained by contacting Michael Carlotti, chief financial officer of Australis, at 800-898-0648 or ir@ausacap.com.

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