Shell Summary for March 16, 2018 Shell Summary for March 16, 2018 Stockwatch Daily19 Mar 2018by Stockwatch Business Reporter THE TSX Venture Exchange closed up 5.59 points to 833.67 Friday, ending the week up 4.77 points. Chuck Rifici’s first capital pool shell, the halted Buzz Capital Inc. (BUZ), plans to acquire a Jamaican marijuana producer called Kaya Inc. for the shell’s qualifying transaction. The shell will roll back 1 for 2, leaving it with 4.1 million shares issued, then issue 32.1 million shares to its target’s shareholders. Kaya opened the first legal medical marijuana dispensary in Jamaica six days ago. (On the same premises as the dispensary, Kaya also runs a cafe and a spa.) Recreational marijuana is illegal in Jamaica. In 2015, however, cultivation and possession of small amounts of it were decriminalized, so Jamaicans may grow up to five plants and possess up to two ounces of dried bud. As well, Rastafarians are allowed to use however much marijuana is required for “religious purposes.” As for tourists, if they have a prescription for medical marijuana, then they may apply for permits to buy and possess up to two ounces of dried bud. Kaya was founded by Balram Vaswani. From 2004 to 2009, he was the chief executive officer of Jamaica News Network and a managing director of Reggae Entertainment TV. Both channels are now part of Radio Jamaica Ltd., which trades on the Jamaica Stock Exchange and last closed at $1.08 (Jamaican), equivalent to 1.1 cents. From 2009 to 2014, Mr. Vaswani was the CEO of Marley Coffee Ltd., a Jamaican coffee company founded by Rohan Marley, a son of the late reggae singer Bob Marley. While Mr. Vaswani was with Marley Coffee, the company was licensing its brand to a pink sheets listing called Jammin’ Java Corp. (JAMN), which peaked at $6.35 (U.S.) in 2011. Later, after Mr. Vaswani had left, Marley Coffee ended this licensing deal. Jammin’ Java responded with a lawsuit, but it lost. Today, its stock closed at $0.0003 (U.S.) or three-hundredths of one U.S. cent. Meanwhile, Marley Coffee seems to be doing well. Its products are available at London Drugs, Walmart and many other stores. Its founder, Rohan Marley, a former Canadian Football League player, has apparently kept in touch with his company’s former CEO, Mr. Vaswani. Both men attended the opening of Kaya’s dispensary last weekend. On closing of the QT, Mr. Vaswani will be the CEO and a director of the resulting issuer. He will be joined on the board by at least three more directors: Lorne Gertner, Joey Houssian and Ben Kaplan. Mr. Gertner is a director of the shell. Previously, he was the chairman of a marijuana holding company called PharmaCan Capital Corp., from 2014 to 2016. PharmaCan has since changed its name to Cronos Group Inc. (CRON: $10.23) and now trades about three times higher than PharmaCan used to (this is not adjusted for a 1-for-7 rollback; accounting for the rollback, Cronos trades about 20 times higher than PharmaCan used to). In 2015, Mr. Gertner and his son founded a chain of retail stores called Tokyo Smoke, which sells marijuana, coffee and suprisingly nice-looking clothing. There are now five branches in Toronto and one in Calgary. Tokyo Smoke was acquired earlier this year by Hiku Brands Company Ltd. (HIKU: $2.85) for 55.97 million shares. Mr. Gertner is a director of Hiku Brands. The next director nominee, Mr. Houssian, is a son of Joe Houssian, whose Intrawest Corp. previously owned the Whistler Blackcomb ski resort. Intrawest was acquired in 2006 for $35 (U.S.) cash per share by Fortress Investment Group LLC of New York. (These days, Whistler Blackcomb is owned by Vail Resorts Inc. of Colorado and Nippon Cable Co. Ltd. of Japan.) As for Mr. Houssian Jr., he is the owner and president of Wedge Rafting Ltd. (a whitewater rafting company) and Superfly Ziplines Ltd., which both operate in Whistler. The final director nominee, Mr. Kaplan, is a Miami investor whose family owns a restaurant chain called Roasters ‘N Toasters. As a condition for closing the QT, Kaya must sell an $8.5-million private placement at $1.25. Hiku Brands has promised to subscribe for shares such that it will own up to 10 per cent of Kaya. Buzz Capital and Kaya expect to close the QT in May. Buzz Capital listed in August, 2017, with a $420,000 initial public offering at 10 cents. Its shell-maker, Mr. Rifici, a chartered accountant, previously volunteered as the treasurer of the Liberal Party of Canada, from 2011 to 2016. In 2014, he co-founded Tweed Marijuana Inc., which peaked at $5.10 and is now a part of Canopy Growth Corp. (WEED: $32.52). Currently, Mr. Rifici is the chairman of National Access Cannabis Corp. (NAC: $0.99), which operatos nine marijuana prescription clinics in Canada. He is also the chairman and CEO of Cannabis Wheaton Income Corp. (CBW: $1.77), a marijuana holding company that recently stopped describing itself as “do ing bus iness as Wheaton Income.” It has no connection to Silver Wheaton Corp., which peaked at $45 in 2011 and is now called Wheaton Precious Metals Corp. (WPM: $25.83). (*MKTSHEL)