Harborside Inc.’s Acquisition of UL Holdings Inc. and LPF JV Corporation

ATB Capital Markets Inc. and Stoic-Solidum Advisory acted as financial advisors to Harborside. Cassels Brock & Blackwell LLP acted as Canadian legal counsel and Duane Morris LLP acted as United States legal counsel to Harborside. PI Financial provided fairness opinions on the Transactions to Harborside. PGP Capital Advisors, LLC acted as financial advisor and Burns & Levinson LLP acted as United States legal counsel to Urbn Leaf. Ducera Partners LLC and Beacon Securities Limited acted as financial advisor and Feuerstein Kulick LLP acted as United States legal counsel to Loudpack.

On November 29, 2021, Harborside Inc. (CSE: HBOR), (OTCQX: HBORF), a California-focused, vertically integrated cannabis enterprise, entered into definitive agreements to acquire UL Holdings Inc. (“Urbn Leaf”),  a top California cannabis retailer with a dominant position in Southern California, and LPF JV Corporation (“Loudpack”), a leading manufacturer, cultivator and distributor of award-winning cannabis brands in California. Following completion of the transactions, Harborside is expected to be renamed StateHouse Holdings Inc. In connection with the transactions, Harborside entered into a letter of intent with Pelorus Equity Group to complete a US$77.3 million real estate debt financing.

The aggregate consideration includes the issuance of approximately 151,427,786 subordinate voting shares, the assumption and restructuring of debts and other obligations as well as the issuance of 2,000,000 warrants at a strike price of US$2.50.  Based upon the relative enterprise value of each party, following closing of the transactions, existing Harborside, Loudpack and Urbn Leaf shareholders will own approximately 35%, 39% and 26% of StateHouse, respectively.

Closing of the transactions remains subject to, among other things, the approval of a majority of votes cast by Harborside shareholders, the approval of a simple majority of the holders of subordinate voting shares of Harborside, the approval of the shareholders of Urbn Leaf, the approval of the sole shareholder of Loudpack, the approval of the voting members of Loudpack’s sole shareholder, the receipt of certain regulatory approvals, including, but not limited to, approval pursuant to the Hart-Scott-Rodino Antitrust Improvements Act, and other customary closing conditions for a transaction of this nature.

The Transactions are expected to close in the first half of 2022, subject to approval by Harborside shareholders, the CSE, regulatory approval and customary closing conditions.

The Cassels’ team was led by Jonathan Sherman (Picture) and included Michael Rosenbloom, Stacey Weltman, Daniel Cipollone and Sophie Beaton. 

Involved fees earner: Daniel Cipollone – Cassels Brock & Blackwell LLP; Michael Rosenbloom – Cassels Brock & Blackwell LLP; Jonathan Sherman – Cassels Brock & Blackwell LLP; Stacey Weltman – Cassels Brock & Blackwell LLP;

Law Firms: Cassels Brock & Blackwell LLP;

Clients: Harborside Inc.;

Sonia Carcano

Author: Sonia Carcano