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CDN MSolar and Blueberries Cannabis Complete Business Combination to Form Blueberries Medical Corp

TORONTO, Feb. 05, 2019 (GLOBE NEWSWIRE) -- PRESS RELEASE -- Blueberries Medical Corp. has announced the completion of its business combination with Blueberries Cannabis Corp., a Colombia-based licensed producer of medicinal cannabis and cannabis-derived products Trading in the common shares of Blueberriesis expected to commence on the Canadian Securities Exchange (CSE) at market open on Wednesday, Feb. 6, 2019 under the symbol “BBM," following the issuance by the CSE of its final bulletin in respect of the transaction, expected today.

“Our public listing in Canada marks the accomplishment of another important milestone for Blueberries as we continue to execute on our vision of becoming a leading producer of premium quality medicinal cannabis products internationally”, stated Christian Toro, chief executive officer. “Combining Canadian leadership in the cannabis industry, strategic global relationships and Colombian passion and expertise, at Blueberries Medical we do things better.”

Operational and Corporate Update

Blueberries is continuing to advance its developments to become a large-scale producer of naturally grown premium quality cannabis with its primary operations well situated in the Bogotá savannah in central Colombia. Lead by a specialized team with proprietary expertise in agriculture, genetics, extraction, medicine, pharmacology and marketing, Blueberries has received all licenses required for the cultivation, production, domestic distribution, and international export of CBD (cannabidiol)- and THC (tetrahydrocannabinol)-based medical cannabis. Blueberries’ combination of leading scientific expertise, agricultural advantages, and distribution arrangements has positioned the company to become a leading international supplier of naturally grown, processed and standardized medicinal-grade cannabis oil extracts and related products.

Since the transaction was initially announced on Sept. 6, 2018, the company has continued to execute on its strategic objectives. Key developments include:

Receipt of cultivation license, making Blueberries fully licensed for cannabis cultivation, processing/extraction and export in Colombia and abroad.Completed a C$8,807,500 private placement, leaving the company well capitalized to execute on its growth strategy (see “Subscription Receipt Financing” below).Pre-registration completed for 134 exclusive cannabis strains with high contents of CBD & THC.Commencement of cultivation in 107,000 ft2 open-air greenhouse facility with commercial production anticipated in Q4 2019.Significant international sale and distribution agreements have been put in place for current products and products under development.Entered into a binding letter of intent with Harmony and Life SAS, a leading wellness clinic in Colombia pursuant to which the clinic will collaborate with Blueberries on the research, development, commercialization and distribution of cannabis-based products.Continued to further strengthen the Company’s management and operational teams (See “New Board and Management” below).

Additional strategic milestones which the Company is continuing to pursue include:

Expansion of the company’s cultivation facility has begun with the goal of growing to approximately 861,000 square feet by the end of 2019 to meet expected immediate demand. Blueberries has capacity to increase its cultivation capacity up to approximately 120 hectares (~13 million ft2) of total cultivation capacity.Engineering and design for a cannabis oil extract processing facility to provide for near-term oil production, with additional space to accommodate modular increases in production capacity as demand for the company’s products grows.Continue to expand product portfolio.Negotiation of additional sales and distribution agreements.

Overview of the Transaction

Pursuant to the Transaction, the company, formerly CDN MSolar Corp. (CDNM), acquired all of the issued and outstanding shares of Private Company through a three-cornered amalgamation of Private Company and a wholly-owned subsidiary of the company, with the former shareholders of Private Company receiving one Blueberries Share for each share of Private Company held. Immediately prior to the completion of the Transaction, CDNM changed its name to “Blueberries Medical Corp.” The transaction constitutes a reverse take-over as the former shareholders of Private Company now own (on a non-diluted basis) approximately 93.1 percent of the issued and outstanding Blueberries Shares immediately following the completion of the Transaction. On closing of the Transaction there were 106,622,772 Blueberries Shares issued and outstanding, with an additional 26,104,150 Blueberries Shares reserved for issuance upon the exercise of securities convertible into Blueberries Shares.

For further information with respect to the Transaction and the business of Blueberries, please refer to the listing statement of Blueberries dated Jan. 31, 2019 (the “Listing Statement”) and posted under Blueberries’ issuer profile on SEDAR at www.sedar.com.

Subscription Receipt Financing

Prior to the closing of the transaction, Private Company completed a non-brokered private placement of subscription receipts (the "Subscription Receipts") at a price of C$0.25 per Subscription Receipt for gross proceeds of C$8,807,500. The proceeds from the offering, less certain expenses, were placed into escrow on completion of the offering. In connection with the completion of the transaction, the Subscription Receipts were converted on a one-for-one basis into a total of 35,230,000 Blueberries Shares and 17,615,000 common share purchase warrants of Blueberries exercisable for a period of two years at C$0.40 per warrant. The escrowed proceeds from the offering, less a finder’s fee, and certain transaction fees and expenses, have been released from escrow to Blueberries. Outstanding finder warrants issued in connection with the offering were also exchanged for comparable securities of Blueberries on a one-for-one basis.

New Board and Management

Upon closing of the transaction, the board of directors and management of the company were reconstituted as follows, in place of the previous officers and directors and officers of CDNM:

Christian Toro, Chief Executive Officer and a Director;Chris Reid, Interim Chief Financial Officer;Camilo Villalba, Chief Operating Officer;Andres Castañeda, Country Manager;Paola Castañeda, Director;Andres Vidal, Director;Francisco Sole, Director;Patricio Villalba, Director;Catherine Lathwell, Director; andMatthew Bajurny, Director.

Biographical descriptions of each director and member of the senior management team of Blueberries is included in the Listing Statement.

Equity Awards

In connection with the completion of the transaction, the company granted an aggregate of 4,790,000 incentive stock options to officers, directors, employees and other service providers to purchase up to the same number of Blueberries Shares. The stock options have an exercise price of C$0.40 per share and expire five years from the date of grant. The options will vest in three equal tranches with one-third vesting on the first anniversary of the grant date, one-third vesting on the second anniversary of the grant date, and one-third vesting on the third anniversary of the grant date.

Information for Shareholders

The company’s transfer agent, Computershare Trust Company of Canada, will be delivering share certificates or statements pursuant to the Direct Registration System to all former holders of common shares of Private Company and to all former holders of Subscription Receipts evidencing the Blueberries Shares received in connection with the completion of the transaction. Certificates representing Blueberries Warrants issued on conversion of the Subscription Receipts will be delivered to former holders of Subscription Receipts directly by the company or its representatives. Shareholders of the company wishing to receive a physical share certificate should contact Computershare at 1.604.661.9400 for information on how to obtain physical share certificates in place of a DRS Advice. The ISIN number for the Blueberries Shares is CA09609Y1016 and the trading symbol reserved for the Blueberries Shares on the CSE is "BBM".

Early Warning

In connection with the transaction, Tora Blue International Corp. (an entity beneficially owned and controlled equally by Andres Castañeda (Country Manager of Blueberries) and Paola Castañeda (a director of Blueberries) acquired 17,500,000 Blueberries Shares. Prior to the completion of the transaction, neither Tora Blue nor Andres or Paola Castañeda had ownership of, or exercised control or direction over, any voting or equity securities of CDNM. As at the date hereof, the 17,500,000 Blueberries Shares held by Tora Blue represent approximately 16.4 percent of the total issued and outstanding Blueberries Shares. The Blueberries Shares were acquired for investment purposes only. Depending on market and other conditions, or as future circumstances may dictate, Tora Blue may from time to time, and subject to any escrow provisions imposed on their Blueberries Shares, increase or decrease its holdings of Blueberries Shares or other securities of Blueberries.

This portion of this news release is issued pursuant to National Instrument 62-103 – The Early Warning System and Related Take-Over Bid and Insider Reporting Issues of the Canadian Securities Administrators, which also requires an early warning report to be filed with the applicable securities regulators containing additional information with respect to the foregoing matters. A copy of the early warning reports of Tora Blue will be available on the Company’s issuer profile on SEDAR at www.sedar.com. Tora Blue can be contacted at Piso 26, Avenida Nicanor de Obarrio, Calle 50, Ciudad de Panamá, República de Panamá.

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