ZENABIS ANNOUNCES RECEIPT OF INTERIM ORDER FOR PROPOSED ARRANGEMENT WITH HEXO CORP.
Also receives Competition Act approval of proposed Arrangement
Vancouver, British Columbia, April 7, 2021 – Zenabis Global Inc. (TSX:ZENA) (“Zenabis” or the “Company“) is pleased to announce that the British Columbia Supreme Court (the “Court“) has granted an interim order (the “Interim Order“) in connection with the previously announced plan of arrangement with HEXO Corp. (TSX:HEXO; NYSE:HEXO) (“HEXO“) under Division 5 of Part 9 of the Business Corporations Act (British Columbia), pursuant to which, among other things and subject to the satisfaction (or waiver) of all applicable conditions precedent, HEXO will acquire all of the issued and outstanding common shares of the Company in exchange for common shares of HEXO (the “Arrangement“). As previously announced, under the terms of the Arrangement Agreement (as defined below), shareholders of the Company (the “Company Shareholders“) will receive 0.01772 of a HEXO common share in exchange for each Company common share. The Interim Order authorizes the calling and holding of a special meeting (the “Meeting“) of the Company Shareholders, the granting of dissent rights to the Company Shareholders and other matters relating to the conduct of the Meeting. In addition to a final order of the Court concluding as to the fairness of the Arrangement (the “Final Order“) at a hearing to be held following the Meeting in the event the Company Shareholders approve the Arrangement as described below, the granting of the Interim Order is a condition precedent to the completion of the Arrangement. In addition, the parties obtained approval under the Competition Act in respect of the Arrangement on April 1, 2021 in the form of an advance ruling certificate under the Competition Act.
At the Meeting, among other things, the Company Shareholders will be asked to consider, and if thought advisable, to pass a special resolution approving the Arrangement (the “Arrangement Resolution“). The Arrangement Resolution will require approval by at least 662/3% of the votes cast by the Company Shareholders present at the Meeting. The Meeting is scheduled to be held virtually via live audio webcast, available online using the LUMI meeting platform at https://web.lumiagm.com/208490937 on May 13, 2021 at 10:00 a.m. (Vancouver time). The record date for the Meeting is April 7, 2021.
In addition to the granting of the Interim Order and approval by the Company Shareholders of the Arrangement Resolution, the Arrangement is subject to the receipt of certain regulatory, court and stock exchange approvals and the satisfaction of other customary conditions precedent in transactions of this nature as well as the satisfaction of certain other specified conditions precedents set out in the arrangement agreement dated February 16, 2021 between the Company and HEXO (the “Arrangement Agreement“). The Arrangement Agreement is available under the Company’s profile on SEDAR at www.sedar.com.
The Arrangement Agreement provides that completion of the Arrangement will occur on or about the third business day following the date on which the conditions to completion of the Arrangement are satisfied or waived with effect as of 12:01 a.m. (Vancouver Time) on such date. The Company and HEXO presently intend that the Arrangement will be completed shortly following the Meeting and the granting of the Final Order.
Further information regarding the Arrangement will be included in the management information circular (the “Circular“) that the Company will prepare, file, and mail in the coming days to the Company Shareholders in connection with the Meeting. A copy of the Circular will also be available under the Company’s profile on SEDAR at www.sedar.com.
Zenabis is a significant Canadian licensed cultivator of medical and recreational cannabis. Zenabis employs staff coast-to-coast, across facilities in Atholville, New Brunswick; Langley, British Columbia; and Stellarton, Nova Scotia. Zenabis currently has 111,200 kg of licensed cannabis cultivation space across three licensed facilities in Canada, together with its cannabis import, export and processing joint venture, ZenPharm, operating from Birżebbuġa, Malta.
For more information, visit: https://www.zenabis.com.