Medicine Man Technologies, Inc. (OTCMKTS:MDCL) Files An 8-K Entry into a Material Definitive Agreement
Item 1.01. Entry into a Material Definitive Agreement.
On June 5, 2020, Medicine Man Technologies, Inc., a Nevada corporation (the “Company”,) and SBUD, LLC, a Colorado limited liability company and wholly-owned subsidiary of the Company (the “Purchaser”) entered into thirteen separate purchase agreements (each individually the “CHC Agreement” the “Citi Agreement” the “Lucky Agreement” the “Kew Agreement” the “Aurora Agreement” the “Arapahoe Agreement” the “Alameda Agreement” the “44th Agreement” the “Pueblo Agreement” the “Louisville Agreement” the “Niwot Agreement” the “Longmont Agreement” and the “Commerce City Agreement,” and collectively the “Agreements”) together with each of Colorado Health Consultants, LLC, CitiMed, LLC, Lucky Ticket LLC, Kew LLC, SB Aurora LLC, SB Arapahoe LLC, SB Alameda LLC, SB 44th LLC, Starbuds Pueblo LLC, Starbuds Louisville LLC, Starbuds Niwot LLC, Starbuds Longmont LLC, and Starbuds Commerce City LLC (any one a “Starbuds Company” and collectively the “Starbuds Group”) whereby the Purchaser agreed to purchase substantially all of the assets of the Starbuds Group from each individual Starbuds Company to the Agreements (the “Purchase”). As previously disclosed in a Current Report on Form 8-K filed September 3, 2019, the Company and the Starbuds Group entered into a binding term sheet (the “Term Sheet”) whereby the Company agreed to purchase the membership interests of each member of each Starbuds Company (the “Proposed Transaction”); the Agreements were entered into in lieu of the Proposed Transaction.
The aggregate purchase price for the assets of the Starbuds Group is approximately $118 million, subject to adjustment upon the closing of the Purchase based on, among other things, the target inventory as opposed to actual inventory and target working capital as opposed to net working capital of each member of the Starbuds Group, and shall be payable to the Starbuds Group and the members a mix of cash and shares of the Company’s common stock, par value $0.001 per share (the “Purchase Price”). The Purchaser will not assume any liabilities of the Starbuds Group other than accounts payable by Starbuds Group, liabilities in respect of any contractual arrangements assigned to the Purchaser by the Starbuds Group, and liabilities in connection with administrative fees associated with obtaining necessary governmental approvals or waivers of such approvals. The Purchaser has also agreed to pay certain transfer taxes in connection with the Purchase. The closing of the Purchase is subject to customary closing terms and conditions, and the closing of the purchase of the assets by the Purchaser of any Starbuds Company is subject to additional closing conditions as set forth in the Agreements.
The foregoing description of the Agreements and the transactions contemplated thereby does not purport to be complete and is qualified in its entirety by reference to: (1) the CHC Agreement, which is filed as Exhibit 2.1 to this report and incorporated herein by reference, (2) the Citi Agreement, which is filed as Exhibit 2.2 to this report and incorporated herein by reference, (3) the Lucky Agreement, which is filed as Exhibit 2.3 to this report and incorporated herein by reference, (4) the Kew Agreement, which is filed as Exhibit 2.4 to this report and incorporated herein by reference, (5) the Aurora Agreement, which is filed as Exhibit 2.5 to this report and incorporated herein by reference, (6) the Arapahoe Agreement, which is filed as Exhibit 2.6 to this report and incorporated herein by reference, (7) the Alameda Agreement, which is filed as Exhibit 2.7 to this report and incorporated herein by reference, (8) the 44th Agreement, which is filed as Exhibit 2.8 to this report and incorporated herein by reference, (9) the Pueblo Agreement, which is filed as Exhibit 2.9 to this report and incorporated herein by reference, (10) the Louisville Agreement, which is filed as Exhibit 2.10 to this report and incorporated herein by reference, (11) the Niwot Agreement, which is filed as Exhibit 2.11 to this report and incorporated herein by reference, (12) the Longmont Agreement, which is filed as Exhibit 2.12 to this report and incorporated herein by reference, and (13) the Commerce City Agreement, which is filed as Exhibit 2.13 to this report and incorporated herein by reference. The Agreements, and the foregoing description of the Agreements and the Purchase, have been included to provide investors and our stockholders with information regarding the terms of the transactions contemplated by the Agreements. The representations and warranties in the Agreements were made as of a specified date and may be subject to materiality standards different than what would be viewed as material to stockholders. As such, the representations and warranties should be considered in conjunction with the entirety of the disclosures about the Company in the public reports filed with the U.S. Securities and Exchange Commission.
Item 7.01 Regulation FD Disclosure
On June 8, 2020, the Company issued a press release announcing that the parties had entered into the Agreements. A copy of the press release is attached as Exhibit 99.1. The Company rebranded and conducts its business under the trade name, Schwazze. The corporate name of the Company continues to be Medicine Man Technologies, Inc.
This report contains "forward-looking statements" within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Such statements may be preceded by the words "intends," "may," "will," "plans," "expects," "anticipates," "projects," "predicts," "estimates," "aims," "believes," "hopes," "potential" or similar words. Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based only on our current beliefs, expectations, and assumptions regarding the future of our business, future plans and strategies, projections, anticipated events and trends, the economy, and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control. Such risks and uncertainties include, without limitation, risks, and uncertainties associated with (i) regulatory limitations on our products and services; (ii) our ability to complete and integrate acquisitions; (iii) general industry and economic conditions; and (iv) our ability to access adequate financing on terms and conditions that are acceptable to us, as well as other risks identified in our filings with the SEC. The Company assumes no obligation to publicly update or revise its forward-looking statements as a result of new information, future events, or otherwise.
Medicine Man Technologies, Inc. Exhibit
EX-2.1 2 medman_ex0201.htm ASSET PURCHASE AGREEMENT – COLORADO HEALTH CONSULTANTS,…
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About Medicine Man Technologies, Inc. (OTCMKTS:MDCL)
Medicine Man Technologies, Inc. is a cannabis consulting company. The Company provides consulting services for cannabis growing technologies and methodologies, as well as retail operations of cannabis products. The Company focuses on providing assistance to its clients in various businesses related to the cannabis industry, including cultivation; the dispensary business model, including combinations and other variables related to the retail model configuration of both a medical, as well as adult use (recreational) operation, and other areas, including but not limited to business plan generation, financial pro forma generation, application generation support, recommendations for other service providers, employee training and facility design services. It offers a separate cultivation or dispensary license and other related consultative services. It offers both pre-license consulting, as well as licensure services that generally tie to the size of the proposed business venture.