MMJ Investor Update – WeedMD

MMJ Group Holdings Limited (ASX:MMJ) (“MMJ”), an Australian-listed company that specialises in managing a portfolio of investments along the cannabis value-chain, attaches the following release by one of MMJ’s largest investees, WeedMD Inc. (TSX-V:WMD) (OTCQX:WDDMF) (FSE:4WE) (“WeedMD” or the “Company”), in relation to its operations in Appendix One.

The WeedMD release provides an update on the Company’s product development, selling and administration overhead reduction program and highlights the benefits of the completing the investment by LiUNA Pension Fund of Central and Eastern Canada (“LPF”) as its largest shareholder. The LPF investment strengthened WeedMD’s balance sheet to further support the Company’s growth plans at a time when liquidity and capital constraints have put the cannabis market under pressure.

MMJ’s investment in WeedMD consists of:

1. CAD6m in 8.5% unsecured convertible debenture units issued by WeedMD which MMJ has the option to convert into 3.75m shares by September 2022. The debenture units have preference over ordinary shares with interest paid to MMJ on quarterly basis.
2. The right to make further investments in WeedMD through warrants that allow MMJ to acquire an additional 3.75m shares for CAD1.80 each for a period of 3 years.

The book value¹ of MMJ’s investment is approximately AUD5.2m.

WeedMD Inc. is a federally-licensed producer of cannabis products for both the medical and adult-use markets in Canada.

The a presentation of WeedMD’s operations and recent capital raising may also be found on the MMJ website WeedMD presentation February 2020.

Read the full ASX Release here.

¹ Based on TSXV market price for notes and warrants