TARGET GROUP INC. (OTCMKTS: CBDY) Files An 8-K Entry into a Material Definitive Agreement
Item 1.01 Entry into a Material Definitive Agreement

Effective December 6, 2018, the Company and its second-tier subsidiary, Canary Rx Inc. (“Canary Rx”), entered into a Distribution, Collaboration and Licensing Agreement (“Agreement”) with Serious Seeds B.V.(“Serious Seeds”), incorporated in the Netherlands, and Simon Smit (“Smit”), President of Serious Seeds. Under the Agreement, Canary Rx is appointed the exclusive distributor in Canada of Serious’ proprietary cannabis seed strains and Serious’ cannabis cuttings, dried flowers and extracts. In addition, under the Agreement Canary Rx and Serious will develop certain “Collaborative Products” defined as cannabis seed strains created collaboratively using Serious’ intellectual property. During the term of the Agreement, Canary Rx will own all of the intellectual property related to the Collaborative Products.

Under the Agreement, Smit has granted Canary Rx an exclusive license in Canada to Serious’ intellectual property including the right to use the service mark of Serious Seeds and all of the names of Serious’ proprietary cannabis seed strains including Indica, Sativa, Hybrid and Autoflowering.

The initial term of the Agreement will be five (5) years and will be automatically renewed for consecutive five (5) terms subject to rights of termination upon one hundred and eighty (180) days prior notice.

In consideration of the intellectual property rights granted by Smit to Canary Rx under the Agreement, the Company will issue to Smit 250,000 shares of the Company’s common stock. In addition, beginning on the 13^th month following the effective date of the Agreement and continuing through the sixtieth month of the initial term, the Company will issue to Smit each month 5,208.3333 shares of common stock and warrants to purchase 200,000 shares of Target common stock at $0.15 per share. In addition, Smit will be issued warrants in each of the foregoing months to purchase 16,666.6667 shares of Target common stock at varying exercise prices ranging from $0.20 to $0.35 per share. All of the warrants must be exercised on or before the two (2) year anniversary date of each of the warrant issuance dates.

In consideration of Canary Rx’s appointment as Serious’ exclusive distributor in Canada, Canary Rx will pay Serious certain royalties as follows:

On December 11, 2018, the Company issued a news release announcing the Company’s entry into the Agreement referred to in Item 1.01 of this Report. The news release is included with this Report as Exhibit 99.1.

On December 12, 2018, the Company issued a follow-up news release which clarified the December 11, 2018 news release with respect the extent of the Company’s “exclusive global” partnership. Under the Agreement, the Company has an exclusive partnership with Serious Seeds in Canada and the first right of refusal for other countries internationally where medical and recreational cannabis is legal. The December 12 release removed the reference to “exclusive global”. The news release is included with this report as Exhibit 99.2.

Target Group Inc. Exhibit
EX-99.1 2 tv509044_ex99-1.htm EXHIBIT 99.1 Exhibit 99.1   Canary Inc. signs Exclusive Partnership Serious Seeds B.V. for the Production and Distribution of Award-Winning Cannabis Seeds and Genetics.       NORFOLK COUNTY,…
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