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TORONTO, June 21, 2018 /CNW/ - High Hampton Holdings Corp. (CSE: HC)(FSE: 0HCN) ("High Hampton" or the "Company") is pleased to announce that it is further expanding its cannabis distribution network in California with the successful close of the acquisition of all the membership interests of 420 Realty, LLC (the "Acquisition"). 420 Realty, LLC ("420") has applied for multiple permits to vertically integrate in the City of Cudahy, CA (Greater Los Angeles Area), for a development agreement (DA) including cannabis cultivation, nursery, manufacturing, delivery, and distribution licenses on a single parcel location.
The City of Cudahy has created specific zones of the city to allow operation for these license types, and 420 will manufacture, deliver, and distribute various flower strains and cannabis concentrates in a variety of CBD-to-THC ratios and terpene profiles.
Christian Scovenna, High Hampton's Sr. VP Corporate Finance, commented:
"This transaction further expands High Hampton's strategic cannabis distribution network in California and will ultimately allow us to bring more products and quality brands online as we advance this and our other assets. With the previously announced acquisitions of CaliGold (see press release April 18, 2018) and Bravo Distro (see press release May 2, 2018) expected to close soon, High Hampton will be well positioned with distribution hubs, product and cultivation opportunities across California."
All membership interests of 420 were purchased for a total of USD$6,550,000 (the "Purchase Price"). The Purchase Price was satisfied by a cash payment of USD$500,000 and the issuance of 8,047,099 common shares of the Company (the "Payment Shares") at a deemed price of CAD$1.00 per Payment Share.
One insider of the Company acquired 3,428,066 Payment Shares, which constitutes a "related party transaction" within the meaning of Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions ("MI 61-101"). The issuance to the insider is exempt from the formal valuation and the minority shareholder approval requirements of MI 61-101 as the fair market value of the Payment Shares issued to or the consideration paid by such person did not exceed 25% of the Company's market capitalization.
All Payment Shares issued in connection with the Acquisition are subject to a voluntary escrow period expiring December 21, 2018, except for the Payment Shares issued to the insider which are subject to a voluntary escrow period expiring on December 21, 2018 and June 21, 2019.
None of the securities issued in connection with the Acquisition will be registered under the United States Securities Act of 1933, as amended (the "1933 Act"), and none of them may be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the 1933 Act. This press release shall not constitute an offer to sell or a solicitation of an offer to buy nor shall there be any sale of the securities in any state where such offer, solicitation, or sale would be unlawful.
About 420 Realty, LLC
420 has applied for multiple permits to vertically integrate in the city of Cudahy, CA for a development agreement (DA). This includes cultivation, nursery, manufacturing, delivery, and distribution licenses on a single parcel location allowing the Company to offer products and services to individual consumers and to licensed dispensary outlets at reduced rates. In doing so, 420 intends to establish a brand identity that is synonymous with topshelf quality and accessible pricing throughout the State of California while manufacturing, delivering, and distributing a wide variety of flower strains and marijuana concentrates in multiple CBD-to-THC ratios and terpene profiles.
420 has a unique product offering and services due to its all-in-one centralized business model including wholesale flower, concentrate, and vaporizer cartridge distribution and management services. This relates to a lower price due to vertical integration and controlling Costs of a Goods Sold. 420 will have the ability to provide additional services such as white label manufacturing and extractions, an essential service to other city and state licensed operators who otherwise don't have a license to operate a manufacturing facility or distribution facility.
About High Hampton Holdings Corp.
High Hampton Holdings Corp. is a cannabis sector investment company focused on opportunities in California. The Company's wholly owned subsidiary, CoachellaGro Corp., is a California corporation focused on the development of their 254,000 sq ft. greenhouse facility situated in the cannabis industrial park located in Coachella, California. CoachellaGro has received a conditional use permit (CUP) for development of a full-service production facility in order to serve third party state licensed medicinal marijuana operators. The City of Coachella has been progressive in setting up city ordinance that sets aside over 90 acres within which will be a legal framework for the cultivation, production, extraction and transportation of cannabis. The complex is intended to contain all the necessary; security, infrastructure, equipment, labour and skilled management, supplies and ancillary services for a closed loop production process flow.
High Hampton trades in Canada, ticker symbol HC on the CSE, and in Europe, ticker symbol 0HCN on the FSE. Neither the CSE, nor the FSE has approved nor disapproved the contents of this press release. Neither the CSE, nor the FSE accepts responsibility for the adequacy or accuracy of this release.
Marijuana Industry Involvement
Canadian listings (CSE) will remain in good standing as long as they provide the disclosure that is rightly required by regulators and complying with applicable licensing requirements and the regulatory framework enacted by the applicable state in which they operate. Marijuana is legal in certain states however marijuana remains illegal under US federal law and the approach to enforcement of US federal law against marijuana is subject to change. Shareholders and investors need to be aware that adverse enforcement actions could affect their investments and that High Hampton's ability to access private and public capital could be affected and or could not be available to support continuing operations.
Certain statements contained in this press release constitute forward-looking information. These statements relate to future events or future performance. The use of any of the words "could", "intend", "expect", "believe", "will", "projected", "estimated" and similar expressions and statements relating to matters that are not historical facts are intended to identify forward-looking information and are based on the Company's current belief or assumptions as to the outcome and timing of such future events. Actual future results may differ materially. In particular, this release contains forward-looking information relating to the intention of the parties to complete the Acquisition and certain ancillary transactions contemplated thereby. These transactions are subject to a number of material risks, and there is no assurance that they will be completed on the terms or within the timeframes currently contemplated, or at all. The forward-looking information contained in this press release is made as of the date hereof and the Company is not obligated to update or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as required by applicable securities laws. Because of the risks, uncertainties and assumptions contained herein, investors should not place undue reliance on forward-looking information. The foregoing statements expressly qualify any forward-looking information contained herein.
All monetary references herein refer to Canadian dollars unless otherwise specified.
SOURCE High Hampton Holdings Corp.
For further information: 8 Wellington St. E. Mezzanine Level | Toronto, On | M5E 1C5 | www.HighHampton.com, David E. Argudo, Chief Executive Officer, Email: [email protected], Phone: 1.844.420.CALI Or Christian Scovenna, Director & VP Corporate Finance, Email: [email protected], Phone: 1.844.420.CALI