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8-K - CURRENT REPORT - GILLA INC. | glla_8k.htm |
Exhibit 99.1
GILLA ANNOUNCES INTENTION TO SPIN-OFF CANNABIS-RELATED
BUSINESS
TORONTO, CANADA – (May 17th,
2018) - Gilla Inc.
(“Gilla” or the “Company”) (OTCQB: GLLA), a
designer, marketer and manufacturer of E-liquid for vaporizers and
developer of cannabis concentrate products, today announced its
plan to pursue a spin-off of the Company’s cannabis-related
business to Gilla’s shareholders. The transaction is expected
to result in two separate public companies that will benefit from
separating their respective corporate strategies and capital
allocation priorities.
The
Company intends to spin-out its cannabis-related assets within the
next sixty days through its wholly-owned Ontario-domiciled
subsidiary, HYSTYLE BRANDS INC. (“HYSTYLE”), subject to
the U.S. Securities and Exchange Commission’s review and
clearance of HYSTYLE’s registration statement on Form 10 and
meeting all of the other conditions to the spin-off. Accordingly,
the Company will establish a record date for the spin-off at such
time that all conditions have been met and expects to declare a
spin-off dividend of a pro-rata ownership of HYSTYLE to
Gilla’s shareholders as at the record date.
Gilla
founded its HYSTYLE subsidiary to hold its cannabis-related brands
and intellectual property. Through HYSTYLE, the Company
manufactures and distributes its hemp-derived CBD products under
the Enriched Vapor brand that is currently being sold in the United
States and parts of the European Union. Further, HYSTYLE also
markets its cannabis products that are sold under the Spectrum
Concentrates brand through a license arrangement in the Colorado
recreational cannabis market. Post spin-off, HYSTYLE will continue
to invest in the growth of these brands while also seeking to
acquire and develop additional brands and intellectual property
under the HYSTYLE banner. Additional details regarding the proposed
spin-off of HYSTYLE and its management team will be announced in
due course.
“This
is an important step for Gilla in its plan to maximize shareholder
value through the creation of a pure-play cannabis-focused brand
and intellectual property company that will be domiciled in
Canada,” stated Mr. Graham Simmonds, Chair and CEO of Gilla.
He added, “Our nicotine business continues to grow and we
remain very bullish on that market, however in order to ensure both
business units receive the appropriate focus and resources, the
Company has determined a spin-off of the cannabis-related assets
would be the most effective structure. HYSTSYLE will be pursuing a
private round of financing, and post spin-off, it will take the
necessary steps towards listing its shares on a Canadian
exchange.”
About Gilla Inc.
Gilla Inc. manufactures, markets and distributes E-liquid for use
in vaporizers and develops turn-key vapor and cannabis concentrate
solutions for high-terpene vape oils, pure crystalline,
high-performance vape pens and other targeted products. Gilla aims
to be a global leader in delivering the most efficient and
effective vaping solutions for nicotine and cannabis related
products. The Company's multi-jurisdictional, broad portfolio
approach services both the nicotine and cannabis markets with
high-quality products that deliver a consistent and reliable user
experience. Gilla's proprietary product portfolio includes:
Spectrum Concentrates, Coil Glaze™, Craft Vapes™,
Siren, The Drip Factory, Shake It, Surf Sauce, Ohana, Moshi, Crisp,
Just Fruit, Vinto Vape, Vapor’s Dozen, Enriched Vapor and
Crown E-liquid™.
Forward-looking Statements
Note:
This press release contains “forward looking
statements” as defined in the Private Securities Litigation
Reform Act of 1995. These forward-looking statements are based on
currently available competitive, financial and economic data and
management’s views and assumptions regarding future events.
Such forward-looking statements are inherently uncertain. Gilla
Inc. cannot provide assurances that the matters described in this
press release will be successfully completed or that the company
will realize the anticipated benefits of any transaction. Actual
results may differ materially from those projected as a result of
certain risks and uncertainties, including but not limited to:
global economic and market conditions; the war on terrorism and the
potential for war or other hostilities in other parts of the world;
the availability of financing and lines of credit; successful
integration of acquired or merged businesses; changes in interest
rates; management’s ability to forecast revenues and control
expenses, especially on a quarterly basis; unexpected decline in
revenues without a corresponding and timely slowdown in expense
growth; the company’s ability to retain key management and
employees; intense competition and the company’s ability to
meet demand at competitive prices and to continue to introduce new
products and new versions of existing products that keep pace with
technological developments, satisfy increasingly sophisticated
customer requirements and achieve market acceptance; relationships
with significant suppliers and customers; as well as other risks
and uncertainties, including but not limited to those detailed from
time to time in Gilla Inc. SEC filings. Gilla Inc. undertakes no
obligation to update information contained in this release. For
further information regarding risks and uncertainties associated
with Gilla Inc.’s business, please refer to the risks and
uncertainties detailed from time to time in Gilla Inc.’s SEC
filings.
For
more information, please visit gilla.com, or
contact:
Mr. Graham Simmonds
Chair and CEO
T: 1
(416) 843-2881
E:
graham.simmonds@gilla.com