Legal Analysis by MontevialeI agree fully with Monty and I ave condensed his points below which is self explanatory. I might add that at when I dined at Josie's the night before the AGM the Copperstate management was there and they are very very close to Cole and I am sure they will do ANYTHING to save Aphria from a demotion to the CSE. The senior copperstate peole were always checking in with Cole on various points. I was at the tablel next and heard many things - all good.
Another point, at my table I was talking to a fellow who laughed when I showed off excitedly the pics of the phase 3 and 4 and how great they were. He said you are talking to the supervisor AND he told me he spends time in Arizone to oversee the IP of APh in those other greenhouses. Also he said copperstate is very dependant on the high technology of Aph robotics and together they works well. They have had multiple bumper harvest greater than expected and so I conclude that Vic may be able to convince the Copperstate shareholders to allow trasfer of ownership to LHS.
Monteviale Points
1. The distinction between Copperstate and Liberty is that Aphria holds shares directly in Copperstate (this is an issue with TMX),
2. Aphria's Florida interest is held indirectly through LHS Inc. With Florida operation, Aphria has no direct holdings of the Florida company (LHS Ltd.).
3. Aphria owns shares in LHS Inc. which is listed on the CSE. In turn LHS Inc. owns the Florida operation.
4. The CSA, OSC and CSE have all agreed that companies listed on the CSE can do business in the US so long as they comply with "enhanced disclosure".
5. By owning shares of a CSE listed company Aphria may well be onside with TMX regulators. Fully legal for Aphria to hold share in CSE listed companies.
6. By transferring ownership in Copperstate to LHS Inc., Aphria is no longer in violation of TMX policy because they now would only hold shares in a Canadian listed company that is in full compliance with CSA, OSC and CSE. Its all legal in Canada. Make's Aphria's argument with TMX even stronger.
7. There is still an issue with Aphria transferring their Copperstate interest to LHS Inc., but this has more to do with getting the consent of all Copperstate partners and nothing to do with TMX.
8. Most likely a shareholders agreement in place between Copperstate partners that governs how a partner can transfer their shares.