UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 8-K

 

CURRENT REPORT

 

PURSUANT TO SECTION 13 OR 15(d) OF

THE SECURITIES EXCHANGE ACT OF 1934

 

Date of Report (Date of earliest event reported): November 24, 2020

 

GSRX INDUSTRIES INC.

(Exact name of registrant as specified in its charter)

 

Nevada   333-141929   14-1982491

(State or other jurisdiction

of incorporation)

 

(Commission

File Number)

 

(I.R.S. Employer

Identification Number)

 

Building No. 3, P.E. 606, int. Jose Efron Ave.

Dorado, Puerto Rico 00646

(Address of principal executive offices, and zip code)

 

(214) 808-8649

(Registrant’s telephone number, including area code)

 

N/A

(Former Name or Former Address, if Changed Since Last Report)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

 

[  ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
   
[  ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
   
[  ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
   
[  ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class   Trading Symbol(s)   Name of each exchange on which registered
N/A   N/A   N/A

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

 

Emerging growth company [  ]

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. [  ]

 

 

 

 
 

 

Item 1.01 Entry into a Material Definitive Agreement.

 

On November 24, 2020, GSRX Industries Inc. (the “Company”) sold all of its Puerto Rican cannabis assets, held by its wholly-owned subsidiary Project 1493, LLC (“Project 1493”), and assigned all related liabilities, licenses and permits, to Puerto Rico Industrial Commercial Holdings Biotech, Corp. (“PRICH Biotech Corp.”) in exchange for total aggregate consideration of US$4,643,333, comprised of immediate net cash proceeds to the Company of US$2,243,333, and monthly payments to be received in the amount of US$100,000 over a period of 24 months.

 

The Company notes that the Puerto Rico Department of Health has approved these transactions.

 

Item 7.01. Regulation FD Disclosure.

 

On November 24, 2020, the Corporation issued a press release announcing the sale of Project 1493’s Puerto Rican cannabis assets to PRICH Biotech Corp. A copy of the press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated into this Item 7.01 by reference.

 

Item 9.01 Financial Statements and Exhibits.

 

Exhibit No.   Description
     
10.1   Option to Purchase Agreement between PRICH Biotech Corp. and Project 1493, LLC. (in English)
10.2   Option to Purchase Agreement between PRICH Biotech Corp. and Project 1493, LLC. (in Spanish)
99.1   Press Release dated November 24, 2020

 

 
 

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

  GSRX INDUSTRIES INC.
     
Dated: November 24, 2020 By: /s/ Troy Nihart
  Name: Troy Nihart
  Title: Interim President and CEO

 

 

 

 

Exhibit 10.1

 

 

 

PRIVILEGED AND CONFIDENTIAL

 

San Juan, November 13, 2020

 

Mr. Edgard Montero

 

Project 1493, LLC.

793 San Patricio Avenue

Las Lomas

San Juan, P.R. 00921

 

GSRX Industries, Inc.

Building No.3 P.R. 696, int. José Efron Ave.

Dorado, 00646

 

Chemesis International, Inc.

Suite 2200 – 885 West Georgia

Street Vacouver, BC V6C 3E8

 

  Re: Option to Purchase

 

From my highest consideration,

 

I am pleased to write to you with the opportunity to express our firm intention to formalize the purchase and transfer of the Medical Cannabis Dispensary establishment licenses and assets, and the assignment of the current lease agreements corresponding to the following locations:

 

  ● Ave. Andalucía #511, San Juan, P.R. 00920
  ● Ave. César González #508, San Juan, P.R. 00918
  ● 65th Infantry Ave. Km. 11.0 Marginal 3, Lomas de Carolina, Carolina, P.R. 00987
  ● Bo. Quebrada de Fajardo, Carr. #3 Km. 44.9, Fajardo, P.R. 00648

 

     
 

 

  ● Paseo del Plata Shopping Center, 696 José Efron Ave, Dorado, P.R. 00646

 

In addition to the referenced licenses and leasing contracts, our offer includes all the furniture and equipment installed in the aforementioned properties and everything necessary to meet the parameters required by the Medical Cannabis Regulatory Board (JRCM) to obtain a Medical Cannabis Dispensary Establishment License.

 

The aforementioned transfer or assignment of the current leasing contracts must have the express consent of the corresponding landlords. The transfer, assignment and sale of the Medical Cannabis Dispensary licenses must have the approval and authorization of the government authorities, including the Medical Cannabis Regulatory Board for the ownership change and the effective assignment to Puerto Rico Industrial Commercial Holdings Biotech, Corp. (“PRICH Biotech”). Said transfer, sale and assignment must be made free of any charge, debt or encumbrance for any reason, except those expressly accepted by PRICH Biotech.

 

The intention of Project 1493, LLC, GSRX, Chemesis International, Inc. and PRICH Biotech is formalized by the signing of the present agreement and with the filing of Application CD-01 before the Medical Cannabis Regulatory Board for the ownership change of the totality of the ownership interests of the Medical Cannabis Dispensary Establishment licenses and the goods, assets, records and any other essential element that is part of said operation.

 

The transfer or assignment of the lease agreements shall be made in a separate lease assignment instrument that will be opportunely notified to the Medical Cannabis Regulatory Board and other government authorities with jurisdiction.

 

The transfer, assignment and sale of the Medical Cannabis Dispensary licenses and the goods, assets, records and any other essential element that is part of said operation will be executed by a transfer of ownership interests and assets agreement, after the approval of the Medical Cannabis Regulatory Board. The price of the transfer and sale of the Medical Cannabis Dispensary licenses, and the goods, assets, records and any other essential element that is part of said operation is three million nine hundred thousand American dollars ($3,900,00 USD), and it is divided in the following manner: 1) one initial payment of one million five hundred thousand American dollars ($1,500,000 USD) at the signing and approval of the corresponding ownership change by the Medical Cannabis Regulatory Board, 2) the rest of the payment will be made in twenty four installments of one hundred thousand American dollars ($100,000) until full payment. This agreement is binding, and its compliance is mandatory for Project 1493, GSRX and Chemesis International, Inc., thus it cannot be rescinded or terminated, except with the express and formal written consent of PRICH Biotech.

 

This economic offer is contingent on the “Due Diligence” process that must be carried out within thirty (30) days following the signing of the consent to accept the terms of this offer; which will include the review of the pertinent documents and a detailed inventory. Likewise, if the proposed business is deemed feasible, this offer will be duly accepted in a contract to be executed by the parties.

 

Signed and accepted by:

 

     
Juan Vicente Carrillo Paris   Edgar Montero Gortarez
CEO   Project 1493, LLC
PRICH Biotech Corp.   GSRX Industries, Inc.
    Corporate Resolution Nos._____

 

     

 

Exhibit 10.2 

 

 

   

 

 

 

   

 

 

Exhibit 99.1

 

 

 

GSRX Industries Inc. announces the Sale of

Puerto Rico Operations & Assets

 

 

November 24, 2020

 

Dorado, Puerto Rico – GSRX Industries Inc. (OTC Pink:GSRX) (“GSRX” or, the “Company”),

 

GSRX Industries Inc. (“GSRX”) announces that it’s wholly-owned subsidiary Project 1493, LLC has sold all of its Puerto Rican cannabis assets, and assigned all related liabilities, licenses and permits, to Puerto Rico Industrial Commercial Holdings Biotech, Corp. in exchange for total aggregate consideration of US$4,643,333, comprised of immediate net cash proceeds to GSRX of US$2,243,333, and monthly payments to be received in the amount of US$100,000 over a period of 24 months.

 

The Company notes that the Puerto Rico Department of Health has approved these transactions.

 

About GSRX Industries Inc.

 

GSRX Industries Inc. (OTC Pink:GSRX), through its subsidiaries, is in the business of distribution, extraction and light manufacturing, and delivery of cannabis and cannabinoid products. GSRX also owns and operates the e-commerce site GetPureAndNatural.com, which offers a broad range of premium hemp extract products.

 

Forward-Looking Statements

 

This press release contains forward-looking statements. Such statements include statements regarding our expectations, hopes, beliefs or intentions regarding the future, including but not limited to statements regarding our market, strategy, competition, development plans (including acquisitions and expansion), financing, anticipated revenues, operations, and compliance with applicable laws. Forward-looking statements involve certain risks and uncertainties, and actual results may differ materially from those discussed in any such statement. Factors that could cause actual results to differ materially from such forward-looking statements include the risks described in greater detail in the following paragraphs. All forward-looking statements in this document are made as of the date hereof, based on information available to us as of the date hereof, and we assume no obligation to update any forward-looking statement except where applicable law requires us to update these statements. Market data used throughout this prospectus is based on published third party reports or the good faith estimates of management, which estimates are based upon their review of internal surveys, independent industry publications and other publicly available information.

 

Contact:

ir@gsrxindustries.com