Colorado-based Dixie Brands Inc. is engaging in a reverse takeover of Academy Explorations Limited and then will list on the Canadian Securities Exchange. Academy will change its business from mining to the cannabis industry and the former shareholders of Dixie will hold approximately 95% of the
common shares of the resulting company.
“We are delighted to take the iconic Dixie Elixir, as well as our other consumer-focused brands, to the public capital markets in order to bring these well
recognized and highly rated products to enthusiastic consumers across the U.S., as well as to Canada and other international markets, ” said Chuck Smith, President, and CEO of Dixie. “The Canadian capital markets have proved to be an important and critical source of growth funding for U.S. cannabis companies. We are preparing for and anticipate a Q4, 2018 public offering on the CSE which will fund revenue generating production, distribution, and consumer marketing
programs to support our global expansion.”
According to the company statement, “Dixie intends to complete a private placement prior to closing of Dixie shares and warrants for aggregate gross proceeds of between $12,000,000 and $20,000,000, including the conversion of approximately $2,000,000 of debt to be exchanged for Dixie common shares at the same deemed value of Dixie as the private placement, at a price equal to the fully diluted equity capitalization of Dixie prior to the Private Placement valued at
$80,000,000. Each Dixie warrant shall entitle the holder thereof to acquire one Dixie share for $13.95, at an approximate valuation of $150,000,000, exercisable for one year.”
Dixie has three portfolio companies under its umbrella: Dixie Elixirs & Edibles, Aceso Wellness (Hempderived CBD based human dietary supplement), and Therabis (Hemp-derived CBD based pet food supplement). The company currently operates in four U.S. states with an aggressive expansion plan for 2019. Dixie has also executed a license agreement with Auxly Cannabis in May of 2018. This agreement permits Auxly to exclusively produce and distribute Dixie branded products throughout Canada. Dixie’s expansion strategy will be to control manufacturing and distribution in all markets where it participates while simultaneously building a global brand known for its quality and efficacy.
Dixie shareholders will be issued roughly 10.45 Academy shares for every one Dixie share. All of Academy’s officers and directors will resign. The statement also said that pursuant to the terms of the LOI, the company will effect a consolidation of its issued and outstanding common shares prior to closing on a 4:1 basis
resulting in approximately 6,641,808 Academy Shares outstanding on a post-Share Consolidation basis. The 400,000 issued and stock options of Academy will be consolidated into 100,000 Academy Options. Each Academy Option will be exercisable for one Academy Share at an the exercise price of C$0.08 per share on a post-Share Consolidation basis until July 5, 2021.