Adult-use cannabis firm Choom (CSE: CHOO) (OTCQB: CHOOF) has agreed to acquire 30 retail locations in Alberta, Canada.
Under a purchase agreement with Clarity Cannabis MD Holdings, the company will acquire 30 retail locations, including three licensed cannabis retail stores.
The acquisition includes a total of 30 leases secured and applications submitted to the Alberta Gaming, Liquor & Cannabis Commission (AGLC) by Clarity.
Currently, Clarity has 11 development permits awaiting construction, with six stores to begin construction, and nine stores completed construction.
Clarity Retail Stores Deal
Choom expects the licenses for the remaining completed stores to be granted soon after the AGLC starts to grant additional retail licenses. Upon approval from the commission, all of the Clarity retail stores will be re-branded under the Choom Cannabis Co. name.
The agreement allows Choom to acquire Clarity itself or all of the 30 retail stores and retail opportunities on a location-by-location basis. The closing of the acquisition is dependent on the timing of the receipt of all necessary provincial and municipal approvals, according to Choom.
“Clarity has been successfully operating in Alberta since December and has submitted applications across the province. This transaction gives us a strong foothold in the Alberta retail landscape. Moving forward we will be working diligently to maximize our retail footprint Canada wide, and this transaction helps us to achieve that goal,” Choom CEO Chris Bogart said in a statement.
Purchase Agreement
Under the purchase agreement, Choom will pay $2 million to the principal shareholder of Clarity and issue 6 million shares to all of the shareholders of Clarity, subject to escrow release over two years.
Additionally, the company will pay $500,000 to the principal shareholder and issue 2.50 million shares to all of the Clarity shareholders, subject to escrow release over two years, once Choom acquires Clarity or acquires one of the Clarity retail stores.
Further, the company issue 2.50 million shares to all of the shareholders of Clarity, subject to escrow release over two years, once the AGLC approves Choom to either acquire one of the Clarity retail stores or to operate any cannabis retail store in Alberta.
Choom will issue 8,867,000 shares and pay $2.5 million to the principal in connection with the acquisition.
