UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 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): July 19, 2019

 

Bespoke Extracts, Inc.
(Exact name of registrant as specified in its charter)

 

Nevada   000-52759   20-4743354
(State or other jurisdiction
of incorporation) 		  (Commission
File Number) 		  (IRS Employer
Identification No.)

 

323 Sunny Isles Boulevard, Suite 700

Sunny Isles Beach, FL 33160

(Address of principal executive offices) (Zip Code)

 

Registrant’s telephone number, including area code (855) 633-3738

 

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: None.

 

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 8.01 Other Events.

 

On July 19, 2019, Bespoke Extracts, Inc. (the “Company”) entered into a non-binding preliminary term sheet with Cannasaver Corp. (“Cannasaver”). The term sheet contemplates that the Company will acquire Cannasaver for aggregate consideration of $25,000,000, 80% of which will be in the form of common stock of the Company, and the remaining 20% of which will be in cash, it being recognized that the Company will need to raise such funds from investors. The completion of this acquisition will be subject to entering into definitive agreements and the satisfaction of customary closing conditions, and there is no assurance such transaction will be completed. Cannasaver is partially owned by Lyle Hauser, who is a former significant stockholder of the Company and is an adviser to the Company.

 

The foregoing summary of the term sheet is qualified by reference to the full text of such document which is attached as Exhibit 99.1 hereto and incorporated herein by reference.

 

Item 9.01 Financial Statements and Exhibits.

 

(d) Exhibits

 

Exhibit No.   Description
99.1   Non-Binding Term Sheet between the Company and Cannasaver

 

1

 

  

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.

 

  Bespoke Extracts, Inc.  
     
Date: July 22, 2019 By: /s/ Niquana Noel
   

Niquana Noel

Chief Executive Officer

 

 

2

 

 

Exhibit 99.1

 

 

NON-BINDING TERM SHEET

 

This Preliminary Term Sheet (this “Term Sheet”) is an expression of interest only and is not meant to be binding on the parties now or in the future. Accordingly, the parties understand and agree that unless and until a definitive agreement (the “Acquisition Agreement”) has been executed by Cannasaver Corp. and its shareholders (the “Company”) and Bespoke Extracts, Inc. (OTC:BSPK) (the “Buyer”) and delivered, no contract or agreement providing for a transaction between the parties shall be deemed to exist between the parties, and neither party will be under any legal obligation of any kind whatsoever with respect to a transaction, including any obligation to negotiate, by virtue of this Non-Binding Term Sheet or any written or oral expression thereof.

 

Transaction: The Buyer proposes to acquire the Company pursuant to the terms and conditions outlined in this Term Sheet. The acquisition will be effected as a merger with a wholly-owned subsidiary of the Buyer (the “Transaction”).

 

Consideration: Aggregate Consideration: to be paid by the Buyer will be $25,000,000.

 

80% of the Consideration paid by the Buyer will be in the form of common stock of the Buyer and will be calculated based on the Closing Price of the common stock as of the date of the signing of a definitive Acquisition agreement between the two parties. The remaining $5,000,000 of consideration will be paid by the Buyer in cash, it being recognized that the Buyer will need to raise such such funds from investors.

 

3 Year Management
Operating Agreement 		For the period of three years from the date of a closing of this Transaction, Mr. Brian Shapiro agrees to continue in his existing role in running the operations of the Company, pursuant to a mutually acceptable management or employment agreement.

 

Acquisition Agreement: The parties expect to enter into a definitive and binding Acquisition Agreement for the Transaction, together with ancillary agreements customary for transactions of similar nature. Such Acquisition Agreement will contain representations, warranties, covenants, including non-competition and confidentiality covenants, conditions to close and indemnities usual to a transaction of this nature, including representations and warranties made by the Company’s shareholders.

 

 

 

 

Due Diligence: The Company will allow the Buyer access to various due diligence materials, including but not limited to its properties, operating and financial data, records, agreements and other relevant information. The Company will also make available to the Buyer members of the management team, accountants, attorneys, partners, and consultants, financing sources and all other relevant representatives, to the extent reasonably requested by the Buyer. The Company will use their best efforts to keep the Buyer informed of any material changes that have occurred or may occur affecting the business, results of operations, condition (financial or otherwise) or prospects of the Company.

 

Transaction Conditions
and Expenses: 		As a condition to a full closing of the Transaction, the Company will be responsible for delivering to the Buyer a full 2-year, Public Company Accounting Oversight Board (PCAOB) Quality audit

.

Each party shall be responsible for their own transaction expenses, including but not limited to payment of their advisors, and relevant corporate and securities counsel.

 

Conduct of Business: Each Party hereby agrees to conduct its business in accordance with the ordinary, usual and normal course of business heretofore conducted by it. Thus, there may be no material adverse changes in the business of either party from the date hereof through the closing of this transaction.

 

Until consummation of the definitive Acquisition Agreement or termination of this Term Sheet, the Company and its shareholders shall not directly or indirectly: (i) offer for sale, sell, assign, pledge, distribute or enter into any contract for the sale of or otherwise dispose of the shares of the Company without the express written consent of the Buyer; (ii) issue or cause to be issued additional shares or options or warrants to purchase shares of the Company to any persons or parties; (iii) offer for sale, sell, assign, pledge, distribute or enter into any contract for the sale of or otherwise dispose of all or substantially all of a material portion of the assets of the Company; or (iv) assume or incur a significant amount of liabilities or take any other actions outside the ordinary course of its business.

 

Page 2

Confidential

 

 

In witness whereof, the parties have executed this non-binding term sheet as of July 19, 2019.

 

Bespoke Extracts Inc.  
   
By: /s/ Niquana Noel  
Name: Niquana Noel  
Title: Chief Executive Officer  
   
Cannasaver Corp.  
   
By: /s/ Brian Shapiro  
Name: Brian Shapiro  
Title:  

 

 

 

Page 3 Confidential