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Harborside To Acquire Majority Stake In FGW Haight

California-based Harborside Inc. said it has agreed to acquire a 50.1 percent stake in FGW Haight Inc., a California-based company that has a conditional use approval required to operate a cannabis dispensary in the Haight Ashbury area of San Francisco, California.

Hraborside noted that the acquisition will further expand its footprint in the state of California and strengthen its presence in the historical and culturally-significant Haight-Ashbury district of San Francisco. The company expects the acquisition to close on or before October 31, 2020.

Under the terms of the deal, Harborside will pay an aggregate purchase price of $2.18 million, based on a post build-out and proforma working capital enterprise value of $4.35 million.

The purchase price will be comprised of $1.265 million as consideration for convertible notes of FGW Haight, entitling the company to underlying shares equal to 29.1 percent of FGW shares.

The balance of the purchase price will be in multiple voting shares or MVS valued at C$125 per MVS as consideration to certain selling shareholders of FGW for 21 percent of the issued and outstanding shares.

Harborside has also agreed to acquire an additional 29.9 percent of the issued and outstanding shares of FGW for 80 percent ownership, subject to regulatory approvals. The aggregate purchase price for the subsequent shares will be $1.30 million.

Further, Harborside will have a right of first refusal to buy the remaining 20 percent of FGW shares, subject to regulatory approvals.

Harborside operates three of the major dispensaries in the San Francisco Bay Area, a dispensary in the Palm Springs area, a dispensary in Oregon, and a cultivation/production facility in Salinas, California.

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