Canna 8 Investment Trust Announces Proposed Qualifying Transaction with Real Industrial Investment Trust

Toronto, Ontario--(Newsfile Corp. - April 17, 2020) - Toronto, Ontario - April 17, 2020 - Canna 8 Investment Trust (TSXV: RCR.P) ("Canna 8") is pleased to announce that it has entered into a letter of intent (the "Letter of Intent") dated April 2, 2020 with Real Industrial Investment Trust ("Real Industrial"), a trust formed pursuant to the laws of the Province of Ontario, whereby Canna 8 and Real Industrial will complete an arrangement, merger, unit exchange or similar transaction to ultimately form the resulting issuer (the "Resulting Issuer") that will continue on the business of Real Industrial (the "Proposed Transaction").

Subject to TSX Venture Exchange (the "TSXV") approval, it is intended that the Proposed Transaction will constitute Canna 8's "Qualifying Transaction" under Policy 2.4 - Capital Pool Companies ("Policy 2.4") of the TSXV and that the Resulting Issuer will be listed as a Tier 1 Real Estate Issuer on the TSXV. It is anticipated that the Proposed Transaction will not be considered a Non-Arm's Length Qualifying Transaction (as that term is defined in Policy 2.4). No finder's fee is payable on respect of the Proposed Transaction. Certain trustees of Canna 8 hold, directly or indirectly, the following percentages of the issued and outstanding units of Real Industrial: (i) Dean Parmar: 6.2%; (ii) Gopi Pillai: 6.2%; (iii) Nebojsa Dobrijevic: 3.1%; and (iv) Sundeep Cheema: 3.1%.

The Letter of Intent provides that Canna 8 and Real Industrial will work together to negotiate and enter into a definitive agreement in respect of the Proposed Transaction (the "Definitive Agreement"). If and when entered into, the Definitive Agreement will supersede the Letter of Intent. The final structure of the Proposed Transaction is subject to receipt of tax, corporate and securities law advice for both Canna 8 and Real Industrial.

Real Industrial is a party to an agreement pursuant to which it has the right to purchase certain real property located in Kirkland, Ontario (the "Kirkland Property") with an approximate value of $8.3 million. Real Industrial intends to acquire the Kirkland Property for the purpose of leasing it. The Kirkland Property has a valid commercial lease in place that expires in 2029. The acquisition of the Kirkland Property by Real Industrial is a condition to closing of the Proposed Transaction.

If the Proposed Transaction is completed, it is currently anticipated that the board of trustees and executive officers of the Resulting Issuer (the "New Slate") will be as follows:

 ● Dean Parmar 
-
Trustee and Chief Executive Officer 
 ● Scott Bartholomew 
-Trustee and Chief Financial Officer 
 ● Lawrence Guy 
-Trustee 
 ● Jacob Goldschmidt 
-Trustee
 ● Shant Poladian 
-Trustee

In conjunction with, and prior to the completion of the Proposed Transaction, Real Industrial intends to complete a private placement for minimum gross proceeds of $5 million (the "Concurrent Private Placement"). The completion of the Proposed Transaction is conditional on the completion of the Concurrent Private Placement. It is intended that the gross proceeds of the Concurrent Private Placement will be used by Real Industrial to complete the acquisition of the Kirkland Property, and for other real property acquisitions and working capital purposes.

Pursuant to the Proposed Transaction it is anticipated that: (i) the outstanding units of Canna 8 will be consolidated on the basis of a consolidation ratio to be determined by Real Industrial and Canna 8 in the context of the closing of the Concurrent Private Placement (the "Consolidation"); and (ii) the holders of Real Industrial units (including those investors in the Concurrent Private Placement) will receive one unit of the Resulting Issuer in exchange for each outstanding Real Industrial unit (on a post-Consolidation basis). The outstanding options and broker warrants of Canna 8 will be adjusted accordingly to reflect the Consolidation.

For the purposes of the Proposed Transaction, the deemed value of each unit of Canna 8 will be $0.15 (on a pre-Consolidation basis).

A comprehensive press release with further particulars relating to the Proposed Transaction and the Resulting Issuer will follow in accordance with the policies of the TSXV.

Completion of the Proposed Transaction is subject to a number of conditions including, but not limited to: completion of satisfactory due diligence; completion of the Concurrent Private Placement; execution of a definitive agreement in respect of the Proposed Transaction; receipt of requisite regulatory approvals; acceptance of the Proposed Transaction as Canna 8's Qualifying Transaction by the TSXV; receipt of all requisite approvals from the unitholders of each of Canna 8 and Real Industrial for the Proposed Transaction and/or ancillary matters relating thereto; and the completion of all other actions necessary to consummate the Proposed Transaction. 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 securities of a capital pool company should be considered highly speculative.

The TSXV has in no way passed upon the merits of the Proposed Transaction and has neither approved nor disapproved the contents of this press release. Neither the TSXV nor its Regulation Services Provider (as that term is defined in the policies of the TSXV) accepts responsibility for the adequacy or accuracy of this press release.

This press release does not constitute an offer to sell or the solicitation of an offer to buy any securities in any jurisdiction.

ANY SECURITIES REFERRED TO HEREIN WILL NOT BE REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933 (THE "1933 ACT") AND MAY NOT BE OFFERED OR SOLD IN THE UNITED STATES OR TO A U.S. PERSON IN THE ABSENCE OF SUCH REGISTRATION OR AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE 1933 ACT.

Notice on forward-looking statements:

This press release includes forward-looking statements regarding Canna 8, Real Industrial, and their respective businesses, which may include, but is not limited to, statements with respect to the completion of the Proposed Transaction and the Concurrent Private Placement, the terms on which the Proposed Transaction and Concurrent Private Placement are intended to be completed, the ability to obtain regulatory and unitholder approvals and other factors. Often, but not always, forward-looking statements can be identified by the use of words such as "plans", "is expected", "expects", "scheduled", "intends", "contemplates", "anticipates", "believes", "proposes" or variations (including negative variations) of such words and phrases, or state that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved. Such statements are based on the current expectations of the management of each entity, and are based on assumptions and subject to risks and uncertainties (including the risk factors listed below). Although the management of each entity believes that the assumptions underlying these statements are reasonable, they may prove to be incorrect. The forward-looking events and circumstances discussed in this release, including completion of the Proposed Transaction and the Concurrent Private Placement, may not occur by certain specified dates or at all and could differ materially as a result of known and unknown risk factors and uncertainties affecting the companies, including risks regarding the real estate industry, failure to obtain regulatory or unitholder approvals, market conditions, economic factors, the equity markets generally and risks associated with growth and competition. Although Canna 8 and Real Industrial have attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results to differ from those anticipated, estimated or intended. No forward-looking statement can be guaranteed. Except as required by applicable securities laws, forward-looking statements speak only as of the date on which they are made and Canna 8 and Real Industrial undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise.

Canna 8 is a capital pool company governed by the policies of the TSXV. The principal business of Canna 8 is the identification and evaluation of assets or businesses with a view to completing a Qualifying Transaction.

For further information concerning Canna 8 Investment Trust, please contact:
Dean Parmar, CEO and Trustee of Canna 8 Investment Trust
dean@simplexinvestment.com
or 780-499-7833

For further information concerning Real Industrial Investment Trust please contact:
Dan Forigo, CEO and Trustee of Real Industrial Investment Trust
dforigo@realindustrialreit.com
or 403-993-2600

Not for Distribution to U.S. Newswire Services or for Dissemination in the United States

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/54570

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