Timeless Provides Update to Proposed Qualifying Transaction with CannaVerde

Vancouver, British Columbia--(Newsfile Corp. - August 9, 2019) - Further to the press release dated June 20, 2019 (the "June Press Release"), Timeless Capital Corp. (TSXV: TLCP) ("Timeless") and CannaVerde Pharma Inc. ("CannaVerde" and, together with Timeless, the "Parties") are pleased to provide the following update on the Parties' proposed business combination (the "Proposed Transaction"). As further described in the June Press Release, it is anticipated that the Proposed Transaction will constitute Timeless' "Qualifying Transaction" pursuant to Policy 2.4 of the TSX Venture Exchange (the "Exchange"). Following the completion of the Proposed Transaction, the resulting entity (the "Resulting Issuer") will hold all of the assets and continue the business of CannaVerde.

Debenture Financing

As previously announced, in connection with the Proposed Transaction, CannaVerde is undertaking a private placement offering (the "Financing") of convertible debentures (the "Convertible Debentures") for gross proceeds of up to $4.5 million. To date, CannaVerde has raised gross proceeds of approximately $2.15 million pursuant to the Financing. In connection with the Financing, CannaVerde has paid to finders, including Industrial Alliance Securities Inc., aggregate finder's fees of $74,800 and issued 74,800 finder's warrants, each exercisable to acquire one CannaVerde common share at an exercise price of $1.00 per share for a period of 24 months from the date of issuance.

The Convertible Debentures are unsecured and bear interest at a rate of 10% per annum, payable on maturity. Upon satisfaction or waiver of all other conditions precedent to the Proposed Transaction, the principal amount of the Convertible Debentures will automatically convert into common shares in the capital of CannaVerde (the "CannaVerde Shares") at a conversion price of $1.00 per share, and such CannaVerde Shares will then be exchanged for shares in the capital of Timeless (the "Timeless Shares") pursuant to the Proposed Transaction. The proceeds of the Concurrent Financing will be used primarily to fund the expansion of CannaVerde's cannabis operations in Colombia and for general working capital.

Proposed Transaction

As described in more detail in the June News Release, pursuant to the Proposed Transaction, CannaVerde will amalgamate with a newly formed subsidiary of Timeless and will become a wholly-owned subsidiary of Timeless and the shareholders of CannaVerde will exchange their CannaVerde Shares for Timeless Shares. The parties anticipate entering into a definitive agreement in respect of the Proposed Transaction within the next few weeks.

In connection with the Proposed Transaction, and subject to Timeless shareholder approval, Timeless will continue out of Alberta and become a British Columbia corporation (the "Continuation") and prior to completing the Proposed Transaction, will consolidate the Timeless Shares on the basis of one (1) new Timeless Share for each six and a half (6.5) old Timeless Shares (the "Consolidation").

It is anticipated that the Resulting Issuer will continue the business of CannaVerde under the name "CannaVerde Pharma Inc.", or such other name as agreed by the parties (the "Name Change") and approved by the Exchange.

Pursuant to the Proposed Transaction, and assuming $4,500,000 raised in the Financing, Timeless will issue to the shareholders of CannaVerde (including the Financing) an aggregate of approximately 16,500,000 post-Consolidation Timeless Shares, representing 94% of the post-Consolidation Timeless Shares, and existing Timeless shareholders will hold an aggregate of approximately 1,076,923 post-Consolidation Timeless Shares, or 6% of the post-Consolidation Timeless Shares.

Timeless has entered into a finder's fee agreement whereby Timeless has agreed to pay to Industrial Alliance Securities Inc., or its nominee, a finder's fee in the aggregate amount of $90,800 in connection with the Proposed Transaction. The finder's fee will be payable in post-Consolidation Timeless Shares based on a value of $1.00 per share.

Completion of the Proposed Transaction remains subject to a number of terms and conditions, including, among other things, (1) completion of the Concurrent Financing (as described above) for minimum gross proceeds of $2.5 million; (2) the Parties having received all required shareholder approvals; (3) the Proposed Transaction being effective on or prior to November 30, 2019; (4) each of the Parties obtaining all necessary consents, orders and regulatory approvals, including conditional listing approval of the Exchange; (5) dissent rights not having been exercised by greater than 5% of the shareholders of each of the parties, as applicable; (6) no material change occurring to the business of any of the parties; (7) the satisfaction of obligations under the Amalgamation Agreement relating to each of the Parties; and (8) the delivery by each of the Parties of customary closing documents.

Summary Financial Information of CannaVerde

Financial information of CannaVerde as at and for the year ended December 31, 2018 and for the period from incorporation (November 8, 2017) to December 31, 2017 is summarized below:


As at and for the year ended December 31, 2018
(audited) (CAD)
As at and for the period from incorporation to
December 31, 2017
(audited) (CAD)
Total Assets$3,451,035$100
Total Liabilities$167,784-
Total Shareholders' Equity$3,283,251$100
Revenue--
Total Loss and Comprehensive Loss$49,365-

 

Proposed Directors and Officers

It is anticipated that all of the current directors and officers of Timeless, other than Shane Shircliff, will resign from their respective positions with Timeless. The board and management of the Resulting Issuer shall be comprised of CannaVerde nominees, and is expected to include Michael Nistorescu (CEO and Director), Paul Robertson (CFO and Director), Shane Shircliff (Director), Marc Johnson (Director), Eduardo Mayorga (President), Daniel Ossma (Chief Commercial Officer) and Peter Chen (Chief Science Officer). The following are brief descriptions of the currently proposed directors and officers of the Resulting Issuer:

Michael Nistorescu - CEO and Director

Michael Nistorescu started his career as an analyst at Gluskin Sheff + Associates and went on to become the Investments Director at Infinite Potential Management. He then co-founded a boutique private equity firm where he served as CEO and Investments Director. Mr. Nistorescu earned a degree in Economics and International Studies from York University, and has passed all three levels of the CFA Program. Mr. Nistorescu has significant experience in business strategy, asset allocation and company management.

Paul Robertson - CFO and Director

Paul Robertson is a Chartered Professional Accountant with extensive experience in the Canadian capital markets specializing in emerging markets. As managing partner of Quantum Advisory Partners LLP, Mr. Robertson has been assisting public companies with financial reporting, governance, and regulatory requirements for over 15 years. Mr. Robertson is currently the interim CEO of Eco Oro Minerals (CSE) and the CFO of GoldQuest Mining Corp. (TSXV). He holds a B.A. from the University of Western Ontario and brings significant expertise in financial reporting.

Shane Shircliff - Director

Shane Shircliff has over 20 years of experience in executive management and corporate director roles for both publicly traded and private companies and has extensive experience with the TSX Venture Exchange. Industries of experience include logistics, finance, natural resources, exploration and mining, real estate and construction. Mr. Shircliff has been directly involved with all aspects of developing resource projects encompassing lithium, uranium, gold, silver, industrial minerals, diamonds as well as oil and gas in a variety of countries. Mr. Shircliff is the founder and CEO of Clinworth Management Corp., a private company, which provides management, acquisition, divestiture and corporate development services to a wide range of clients. Clinworth most recently has been working with and advising clients in the areas of resources, retail, real estate and construction. In addition to industry clients, Clinworth continues to advise First Nations bands and their economic development entities on strategy, negotiation and growth opportunities. Mr. Shircliff has a Bachelor of Commerce (Finance and Economics) and a Masters of Business Administration both from the University of Saskatchewan.

Marc Johnson - Director

Marc Johnson is a bilingual senior executive with over 20 years of business experience, including 10 years at public corporations as CFO, VP Corporate Development and other financial management positions, and 10 years in capital markets in investment banking and equity research. Mr. Johnson is a Chartered Financial Analyst (CFA) and a Chartered Professional Accountant (CPA). Currently, Mr. Johnson is the CFO of NextSource Materials Inc. (TSXV) and International Corona Capital Corp. (TSXV). He also holds a Bachelor of Commerce (Finance) from the John Molson School of Business at Concordia University in Montreal.

Eduardo Mayorga - President

Eduardo Mayorga has over seventeen years in the strategic management, planning and development of projects throughout Colombia. Mr. Mayorga has worked at implementing BASC and IFC standards for both domestic and international companies in both the public and private sectors (free trade zones, banks, infrastructure, oil and gas and education). He earned his MBA in strategic leadership from Andes University and his specialty in the management of human development from Rosario University. Mr. Mayorga brings expertise in managing international teams and projects in Colombia.

Daniel Ossma - Chief Commercial Officer

Daniel Ossma has worked for over fifteen years in the pharmaceutical industry in Latin America. Most recently, Mr. Ossma served as the Head of Hematology Business Franchise for Novartis in Ecuador and Peru. Mr. Ossma will be responsible for spearheading CannaVerde's commercial and operational strategy for Latin America, where he will structure and re-enforce the company's abilities to partner with key players in the consumer market, ensure innovative products are brought to consumers and develop the company's long-term market strategy.

Peter Chen - Chief Science Officer

Dr. Peter Chen holds a PhD in Food Science from the University of Guelph and was the recipient of the Governor General's Academic Gold Medal for academic excellence. His PhD focused on plant bioactive molecules with antioxidant and anti-inflammatory activities which resulted in 20 peer-reviewed publications. Dr. Chen has also written numerous articles on a wide variety of topics related to cannabis research. His work experience includes working as the Lead Scientist and VP of Science for two licensed cannabis producers in Canada.

Sponsor

In accordance with the requirements of the Exchange, the Parties have engaged Industrial Alliance Securities Inc. to act as sponsor in connection with the Proposed Transaction.

Additional Information

Additional information concerning the Proposed Transaction, Timeless, CannaVerde and the Resulting Issuer will be provided in Timeless' Filing Statement to be filed in connection with the Proposed Transaction, which will be available under Timeless' SEDAR profile at www.sedar.com.

In accordance with the policies of the Exchange, Timeless Shares are currently halted from trading and will remain so until such time as the Exchange determines, which, depending on the policies of the Exchange, may not occur until completion of the Proposed Transaction.

None of the securities to be issued pursuant to the Proposed Transaction have been or will be registered under the United States Securities Act of 1933, as amended, or any state securities laws, and any securities issued pursuant to the Proposed Transaction are anticipated to be issued in reliance upon available exemptions from such registration requirements. This press release does not constitute an offer to sell or the solicitation of an offer to buy any securities.

About CannaVerde

CannaVerde's goal is to become a low cost, high quality producer of medical cannabis extracts, with a further focus on product formulation and development. Through its wholly-owned subsidiary, Green Health Colombia S.A.S, it holds licenses to cultivate, extract, produce, manufacture and export both CBD (cannabidiol) and THC (tetrahydrocannabinol) medical extracts.

CannaVerde intends to build greenhouses and extraction facilities on its 7-hectare property located in Bucaramanga, Colombia and has access to an additional 100 hectares of land. The company recognizes the significant role that Colombia's ideal climate, infrastructure and workforce will play in building a sustainable business at a fraction of the cost in other jurisdictions. Furthermore, the ideal location of Colombia gives the company access to approximately 640 million potential customers in Latin America. The directors and executives at CannaVerde have built a business plan focused on delivering cannabis-based extracts and products in Colombia and the international marketplace.

About Timeless

Timeless is a capital pool company formed under the Exchange capital pool company program.

For further information:

Timeless Capital Corp.
Fadim Gadallah, CEO
Phone.: 604.248.2080
Email: fgadallah@gadallahmanagement.com

CannaVerde Pharma Inc.
Michael Nistorescu, CEO
Phone : 416-882-9006
Email: michael@cannaverdepharma.com

Completion of the Proposed Transaction is subject to a number of conditions, including but not limited to, Exchange acceptance and obtaining all required shareholder approvals. There can be no assurance that the Proposed Transaction will be completed as proposed or at all.

Investors are cautioned that, except as disclosed in the management information circular or filing statement to be prepared in connection with the Proposed Transaction, any information released or received with respect to the Proposed Transaction may not be accurate or complete and should not be relied upon. Trading in the securities of a capital pool company should be considered highly speculative.

The Exchange has in no way passed upon the merits of the Proposed Transaction and has neither approved nor disapproved the contents of this press release.

Industrial Alliance Securities Inc., subject to completion of satisfactory due diligence, has agreed to act as sponsor in connection with the transaction. An agreement to sponsor should not be construed as any assurance with respect to the merits of the transaction or the likelihood of completion.

All information contained in this news release with respect to Timeless, CannaVerde, and the Resulting Issuer was supplied by the Parties, respectively, for inclusion herein, and Timeless and its directors and officers have relied on CannaVerde for any information concerning such party.

Not for distribution to United States newswire services or for release, publication, distribution or dissemination, directly or indirectly, in whole or in part, in or into the United States.

Forward-Looking Statements

This news release contains forward-looking statements relating to the timing and completion of the Proposed Transaction and related transactions, the future operations of the Timeless, CannaVerde, and the Resulting Issuer and other statements that are not historical facts. Forward-looking statements are often identified by terms such as "will", "may", "should", "anticipate", "expects" and similar expressions. All statements, other than statements of historical fact, included in this release are forward-looking statements that involve risks and uncertainties. There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements. Important factors that could cause actual results to differ materially from Timeless' and CannaVerde's expectations include the failure to satisfy the conditions to completion of the Proposed Transaction set forth above and other risks detailed from time to time in the filings made by Timeless, CannaVerde, and the Resulting Issuer with securities regulators.

The reader is cautioned that assumptions used in the preparation of any forward-looking information may prove to be incorrect. Events or circumstances may cause actual results to differ materially from those predicted, as a result of numerous known and unknown risks, uncertainties, and other factors, many of which are beyond the control of Timeless, CannaVerde, and the Resulting Issuer. As a result, Timeless, CannaVerde, and the Resulting Issuer cannot guarantee that the Proposed Transaction will be completed on the terms and within the time disclosed herein or at all. The reader is cautioned not to place undue reliance on any forward-looking information. Such information, although considered reasonable by management at the time of preparation, may prove to be incorrect and actual results may differ materially from those anticipated. Forward-looking statements contained in this news release are expressly qualified by this cautionary statement. The forward-looking statements contained in this news release are made as of the date of this news release and Timeless, CannaVerde, and the Resulting Issuer will only update or revise publicly any of the included forward-looking statements as expressly required by Canadian securities law.

Not for distribution to United States newswire services or for release, publication, distribution or dissemination, directly or indirectly, in whole or in part, in or into the United States.

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/46833

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