World Wide Announces Closing of Abacus Health Products Offering and Entering Into of Definitive Merger Agreement
TORONTO, Dec. 21, 2018 (GLOBE NEWSWIRE) — World Wide Inc. (“World Wide” or the “Company”) is pleased to announce that, in connection with the proposed business combination by way of a transaction (the “Transaction”) that will constitute a reverse takeover of the Company by Abacus Health Products, Inc. (“Abacus”), as previously disclosed in a press release of the Company dated September 13, 2018, (i) Abacus has completed a brokered private placement offering (the “Brokered Offering”) of subscription receipts of Abacus (the “Subscription Receipts”) led by Eight Capital, together with Haywood Securities Inc., Cormark Securities Inc. and Paradigm Capital Inc. (collectively, with Eight Capital, the “Agents”) and a concurrent non-brokered private placement offering of Subscription Receipts (the “Non-Brokered Offering” and, together with the Brokered Offering, the “Offering”), and (ii) it has entered into a definitive merger agreement dated December 21, 2018 with Abacus (the “Merger Agreement”). In connection with the Brokered Offering, the Company entered into an agency agreement (the “Agency Agreement”) dated December 21, 2018 with Abacus and the Agents.
The Offering
Pursuant to the Offering, Abacus completed the issuance of an aggregate of 3,272,350 Subscription Receipts at a price of US$3.75 per Subscription Receipt, for aggregate gross proceeds of US$12,271,312.50. The gross proceeds of the Offering, less certain expenses of the Agents and 50% of the Agents’ commission (the “Escrowed Proceeds”), will be held in escrow on behalf of the holders of Subscription Receipts by Odyssey Trust Company (the “Subscription Receipt Agent”) pursuant to the terms of a subscription receipt agreement dated December 21, 2018 among Abacus, Eight Capital and the Subscription Receipt Agent (the “Subscription Receipt Agreement”) and will be released to Abacus upon completion of certain conditions, as described below.
Each Subscription Receipt will be automatically converted, without additional payment, into one share of Class A common stock of Abacus (the “Abacus Subordinate Voting Shares”) upon satisfaction of the following conditions (the “Escrow Release Conditions”): (i) the completion, satisfaction or waiver of all conditions precedent to the Transaction as set forth in the Merger Agreement, other than the release of the Escrowed Proceeds; (ii) the receipt of all shareholder, third-party (as applicable) and regulatory approvals required for the Transaction, including, without limitation, the conditional approval of the Canadian Securities Exchange (the “Exchange”) for the Transaction and the Offering, if applicable, and the conditional approval of the Exchange of the listing of the Resulting Issuer Subordinate Voting Shares (as defined below) issuable at closing of the Transaction (including to former holders of Subscription Receipts); (iii) written confirmation from each of Abacus and World Wide that all conditions of the Transaction have been satisfied or waived, other than release of the Escrowed Proceeds, and that the Transaction shall be completed forthwith upon release of the Escrowed Proceeds; (iv) the distribution of the Resulting Issuer Subordinate Voting Shares to be issued at closing of the Transaction (including to former holders of Subscription Receipts) being exempt from applicable prospectus and registration requirements of applicable securities laws and not subject to any hold or restricted period (subject to any Exchange escrow restrictions or any applicable transfer restrictions under U.S. securities laws); and (v) Abacus and Eight Capital, on its own behalf and on behalf of the other Agents, shall have delivered a release notice and direction to the Subscription Receipt Agent confirming that the foregoing items (i) through (iv), inclusive, have been satisfied or waived.
If the closing of the Transaction does not occur or is terminated, each holder of Subscription Receipts will be reimbursed the original subscription price and the Subscription Receipts will be cancelled.
Pursuant to the terms of the Agency Agreement, the Agents are to receive a cash commission of US$536,726.25, representing an amount equal to 6.0% of the gross proceeds from the sale of the Subscription Receipts to purchasers pursuant to the Brokered Offering, with 50% of such commission being paid on closing of the Offering, and the remaining 50% of the commission being payable upon satisfaction of the Escrow Release Conditions. The Agents also received an aggregate of 143,127 non-transferrable compensation warrants (the “Compensation Warrants”), representing an amount equal to 6.0% of the number of Subscription Receipts sold to purchasers pursuant to the Brokered Offering. Each Compensation Warrant will entitle the holder thereof to acquire one Abacus Subordinate Voting Share at a price of US$3.75 at any time before 5:00 p.m. (Toronto time) on the date that is 24 months following the satisfaction of the Escrow Release Conditions, subject to adjustments in certain events.
The net proceeds of the Offering, once released from escrow, will be used by the Resulting Issuer (as hereinafter defined) to fund working capital requirements and for general corporate purposes.
The Merger Agreement
Pursuant to the Merger Agreement, Abacus is expected to complete a business combination by way of a merger and share exchange among Abacus, the Company and World Wide Subco Inc., a wholly-owned subsidiary of the Company. As a result of the Transaction, the securityholders of Abacus will become securityholders of World Wide (expected to be renamed “Abacus Health Products, Inc.”, such corporation being the “Resulting Issuer”). Upon completion of the Transaction, among other things and, pursuant to a series of steps as outlined in the Merger Agreement, the Abacus Subordinate Voting Shares to be issued upon the exchange of the Subscription Receipts will be exchanged for, without any further action on the part of the holder thereof, subordinate voting shares in the capital of the Resulting Issuer (the “Resulting Issuer Subordinate Voting Shares”), at an exchange ratio of one (1) Abacus Subordinate Voting Share for each one (1) Resulting Issuer Subordinate Voting Share. The Compensation Warrants will also be exchanged for compensation warrants of the Resulting Issuer, on substantially the same terms and conditions, on a one for one basis.
The Merger Agreement will be filed under the Company’s profile on SEDAR at www.sedar.com. The foregoing summary of the Merger Agreement is qualified in its entirety by the full text of the Merger Agreement.
Application has been made with the Exchange to list the Resulting Issuer Subordinate Voting Shares and the Company will provide a further update regarding the expected timing of listing in due course. Upon completion of the Transaction, the Resulting Issuer will continue on with the business of Abacus. Further details about the Transaction and the Resulting Issuer will be provided in the listing statement (the “Listing Statement”) to be filed on SEDAR in respect of the Transaction. Closing of the Transaction is expected to occur by mid-January, 2019.
Board Composition
Upon closing of the Transaction, the board of directors and management of the Resulting Issuer are expected to consist of the persons identified below:
- Phillip (Phil) Henderson – Director;
- Jesse Kaplan – Director;
- Eval Rosenthal – Director;
- Perry Antelman – Chairman of the Board of Directors and Chief Executive Officer; and
- Henry (Hank) R Hague, III – Chief Financial Officer.
The relevant biographies of each expected director and officer of the Resulting Issuer will be set out in the Listing Statement.
About World Wide
World Wide previously operated as a mineral exploration company but presently has no current activities or operations.
About Abacus
Abacus is a company engaged in the development and commercialization of over-the-counter topical pain-relieving products infused with cannabidiol (“CBD”), a medicinal, non-psychoactive extract of cannabis. Abacus believes it is the first company to commercialize topical pain relief products infused with CBD registered with the U.S. Food and Drug Administration (the “FDA”). The products of Abacus are aimed at the rapidly growing market for topical pain relief and are based on proprietary patent-pending technologies developed by Abacus. Abacus’ CBD-infused formulations combine science with organic and all-natural ingredients and provide natural and safe pain relief. All products commercialized by Abacus are registered with the FDA and utilize FDA-approved analgesic ingredients. Abacus currently offers two lines of products: (i) CBD CLINICTM, marketed to the professional practitioner market, and (ii) CBDMEDICTM, marketed to the consumer market. Abacus is also developing a pipeline of other CBD products addressing additional medical indications and targeting the health and wellness segments. The products of Abacus are currently offered across the United States and are produced by a contract manufacturer in an FDA-compliant and audited manufacturing facility.
Cautionary Statements Regarding Forward Looking Information
This news release contains “forward-looking information” within the meaning of applicable securities laws relating to the proposal to complete the Transaction and associated transactions. Any such forward-looking statements may be identified by words such as “expects”, “anticipates”, “believes”, “projects”, “plans” and similar expressions. Readers are cautioned not to place undue reliance on forward-looking statements. Statements about, among other things, the expected closing of the Transaction, Abacus’ strategic plans and the parties’ ability to satisfy closing conditions and receive necessary approvals are all forward-looking information. These statements should not be read as guarantees of future performance or results. Such statements involve known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements to be materially different from those implied by such statements. Although such statements are based on management’s reasonable assumptions, there can be no assurance that the Transaction will occur or that, if the Transaction does occur, it will be completed on the terms described above. World Wide and Abacus assume no responsibility to update or revise forward-looking information to reflect new events or circumstances unless required by applicable law.
Investors are cautioned that any information released or received with respect to the Transaction in this press release may not be complete and should not be relied upon. Trading in the securities of the Company should be considered highly speculative. Investors are cautioned that, except as disclosed in the management information circular of the Company, Listing Statement or any other disclosure document prepared in connection with the Transaction, any information released or received with respect to the Transaction may not be accurate or complete and should not be relied upon.
The securities to be issued in connection with the Transaction have not been and will not be registered under the United States Securities Act of 1933, as amended (the “U.S. Securities Act”) or any state securities laws and may not be offered or sold within the United States or to U.S. Persons (as defined in Regulation S promulgated under the U.S. Securities Act) unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available. This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any jurisdiction in which such offer, solicitation or sale would be unlawful.
Completion of the Transaction is subject to a number of conditions, including but not limited to, Exchange acceptance. There can be no assurance that the Transaction will be completed as proposed or at all.
Neither the Exchange nor its Market Regulator (as that term is defined in the policies of the Exchange) accepts responsibility for the adequacy or accuracy of this release.
For more information, please contact:
World Wide
Yaron Conforti, Chief Executive Officer and Director
Telephone: (416) 716-8181
Abacus
Perry Antelman, Chief Executive Officer
E-mail: [email protected]
THIS NEWS RELEASE IS INTENDED FOR DISTRIBUTION IN CANADA ONLY AND IS NOT INTENDED FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR DISSEMINATION IN THE UNITED STATES.