Nabis excited about its entrance into California with the Desert's Finest dispensary

Nabis Holdings Inc (CSE:NAB) (OTCMKTS:NABIF) told shareholders on Tuesday that it is excited about the acquisition of a new dispensary that marks the cannabis company’s entrance into the booming California market.

The Vancouver-based company noted that it has amended the terms of the acquisition to gain 100% ownership of the Desert’s Finest dispensary for US$5.6 million. The total price now consists of US$1.9 million in cash and US$3.8 million as a convertible note instead of a stock consideration.

READ: Nabis Holdings inks deal with CannaKorp to produce pods for its Wisp Vaporizing System

The 6,000 square foot dispensary is located in Desert Hot Springs, California. It currently has more than 40,000 registered patients and tallied annual sales of US$5.7 million in 2018.

Nabis said it will add its Be In Synergy (BIS) brand to Desert’s Finest products, which include flower, vape, and edibles.

“We remain excited about the acquisition of Desert’s Finest as it will notably be our entrant into the state of California, the largest and most dominant cannabis market in the US,” Nabis CEO Shay Shnet said in a statement.

“The Desert’s Finest dispensary is currently generating meaningful sales, driven in part by its convenient location near Palm Springs and an extensive list of registered patients. Once part of the Nabis portfolio, we will continue to grow this location adding in our BIS products for sale.”

Under the amended terms of the deal, the convertible note has a 12-month term at a 6% interest rate with a forced conversion if the volume-weighted average share price over a 10-day period is at least C$0.70, the market capitalization stays at or above C$35 million and the average daily trading volume is C$100,000.

In the event of that occurrence, Nabis will issue sellers stock equal to the amount resulting from dividing the outstanding principal amount of the note, together with any accrued interest as of the forced conversion date by the lower of C$0.60 and the ten-day volume weighted average price.

If, on the one year anniversary, the company’s average market capitalization on the Canadian Securities Exchange is at least C$10 million and the stock’s daily average trading volume is C$100,000, Nabis will issue shares equal to the number resulting from dividing any remaining outstanding principal amount of the note, along with any accrued interest on the note as of the outside conversation date, by the conversion price.

Nabis recently reached a deal with CannaKorp Inc to become an authorized supplier of single-use pods for its signature Wisp Vaporizer System.

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Story by ProactiveInvestors