Cann-Is Capital Corp. Provides Update on Qualifying Transaction with CWE European Holdings Inc.


Toronto, Ontario–(Newsfile Corp. – August 17, 2022) – Cann-Is Capital Corp. (TSXV: NIS.P) (“Cann-Is” or the “Corporation“) is pleased to provide certain updates from its press releases dated September 21, 2021 in regards to the Corporation’s proposed qualifying transaction (the “Transaction“) with CWE European Holdings Inc., a company incorporated under the laws of Canada (“CWE“), pursuant to which the Corporation will acquire all of the issued and outstanding shares in the capital of CWE. When completed, the Transaction will constitute the Corporation’s Qualifying Transaction, as such term is defined in the policies of the TSX Venture Exchange (the “Exchange“). The Transaction is subject to compliance with all necessary regulatory and other approvals and certain other terms and conditions. The parties executed a binding engagement agreement on September 23, 2020, which was amended on November 4, 2020, further amended on September 20, 2021 and has been prolonged further since then.


It is currently anticipated that Cann-Is will acquire CWE by way of a share exchange, or other similar form of transaction as agreed by the parties to ultimately form the resulting issuer (the “Resulting Issuer”). The final structure of the Transaction is subject to the receipt of tax, corporate and securities law advice for both Cann-Is and CWE. Upon completion of the Transaction, the Resulting Issuer will carry on the business of CWE. The parties have agreed that for the purposes of the Transaction, the valuation of Cann-Is will be $626,102 and CWE will be $5,859,824, not including any financings, finder fees and settlements for CWE which took place in 2022.

The Transaction is not a Non-Arm’s Length Qualifying Transaction, as such term is defined in the polices of the Exchange and consequently the Transaction will not be subject to approval by Cann-Is’ shareholders.

CWE has 48,829,367 shares outstanding, which is a result of a brokered- financing and normal course of business debt for share settlements

As part of the Transaction, CWE completed a financing of $2,742,983.04 in May 2021to meet the initial listing requirements of the Exchange (the “Financing“). CWE engaged Florence Wealth Management Inc. (the “Agent“) to act as agent in connection with the Financing and the Agent appointed selling groups consisting of other co-agents or sub-agents who are registered dealers. The Financing resulted in the issuance of 22,858,192 units in the capital of CWE (each a “Unit“) at a price of $0.12 per Unit. Each Unit was comprised of one (1) CWE Share and one (1) CWE Share purchase warrant (each a “Warrant“). Each Warrant entitles the holder thereof to acquire one (1) CWE Share at a price of $0.18 per CWE Share for a period of twenty-four (24) months following the closing of the Financing.

As part of the Transaction, CWE will complete an additional non-brokered financing of a minimum of $1,000,000 to meet the needs of the company (the “Financing“). CWE has engaged Florence Wealth Management Inc. (the “Finder”) to act as a non-exclusive finder in connection with the Financing The Financing will be comprised of a minimum of 8,333,333 units in the capital of CWE (each a “Unit”) at a price of $0.12 per Unit. Each Unit will be comprised of one CWE Share and one CWE Share purchase warrant (each a “Warrant“). Each Warrant entitles the holder thereof to acquire one Share at a price of $0.24 per Post-Split CWE Share for a period of twenty-four (24) months following the closing of the Financing.

In connection with the Financing, the parties will pay to the Finder a cash commission equal to 9% of the aggregate gross proceeds of the Financing; and finder warrants (“Finder Warrants“) equivalent to 9% of the underlying securities sold in the Financing Each Finder Warrant will be exercisable into one Unit at a price of $0.12 per Unit for a period of twenty-four (24) months following the closing of the Financing.

Upon completion of the Transaction and on an undiluted basis, it is expected that (i) the former shareholders of CWE will hold approximately 38.5% of the common shares in the Resulting Issuer (each a “Resulting Issuer Share“) (on a non-diluted basis), (ii) the former shareholders of Cann-Is will hold approximately 9% of the Resulting Issuer Shares, (iii) the investors in the brokered and non-brokered Financing, collectively, will hold 48% of the Resulting Issuer Shares,

Closing of the Transaction will be subject to a number of conditions precedent, including, without limitation:

  1. completion of mutual satisfactory due diligence investigations of CWE and Cann-Is;
  2. approval of the Transaction by the boards of directors of CWE and Cann-Is;
  3. execution of a definitive agreement effecting the Transaction;
  4. completion of the Financing;
  5. receipt of all regulatory approvals with respect to the Transaction and the listing of the Resulting Issuer Shares on the Exchange;
  6. approval of the Transaction by CWE shareholders,
  7. approval of the Name Change, and the approval of new directors by the Cann-Is shareholders; and
  8. confirmation of no material adverse change by CWE and Cann-Is.

It is anticipated that the Resulting Issuer will qualify as a Tier 2 Issuer pursuant to the requirements of the Exchange.


The Corporation intends to apply for a waiver from the sponsorship requirement in accordance with Exchange Policy 2.2.


CWE was incorporated under the Business Corporations Act (Alberta) on May 6, 2019 as a private corporation with wholly-owned subsidiaries that operate a seed to sale Hemp business in Germany in compliance with applicable laws. CWE is selling an organic, health conscious lifestyle based on Hemp products, some containing CBD.

CWE is seeking to become the largest Hemp offline and online retailer in Germany building a controlled access to customers by opening retail locations in Germany. Currently CWE owns and operates ten (10) stores in the State of Bavaria in Germany through five (5) German subsidiaries. CWE has developed a private label Hemp derived CBD brand which makes up 50% of offline retail sales. The stores are operated under the brand name “HANF” in Germany.

The Corporation’s subsidiaries include:

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Figure 1

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  1. DCI Cannabis Institute GmbH (“DCI“), incorporated in Germany on December 1, 2016. CWE acquired 89.6% of the share capital of DCI on July 4, 2019 pursuant to an agreement with four (4) shareholders of DCI. The balance of the share capital, 10.4%, is owned by an arm’s length German company. The company ceased most of its operations.
  2. CWE Trading GmbH (“CWE-UG“) incorporated in Germany on April 16, 2020 as wholly owned subsidiary. CWE-UG owns and operates four (4) shops.
  3. CWE Trading EINS GmbH (“CWE-E-UG“) incorporated in Germany on August 16, 2020 as wholly owned subsidiary. CWE-E-UG owns and operates five (5) shops.
  4. CWE Trading ZWEI GmbH (“CWE-Z-UG“) incorporated in Germany on April 16, 2021 as wholly owned subsidiary. CWE-Z-U own and operates eight (8) shops.
  5. CWE Holding Europe GmbH (“CWE H“) incorporated in Germany on April 16, 2021 as wholly owned subsidiary. CWE H is created for future franchise business.

Franchising plan

As part of its growth plan, CWE engaged a franchising expert to expand the retail locations through franchising throughout Germany.

The franchising model that the parties agreed on are as follows:

  • The Franchisee received exclusivity on a certain area in Germany.
  • The Franchisee commits to open several retail locations in the exclusive area.
  • The Franchisee pays a license fee of Euro25,000 (CAD$32,500) per location + the refurbishment expenses.
  • The inventory is consigned by CWE.
  • Rent and labour costs are borne by the Franchisee.
  • The Franchisee received a 40% commission on gross sales from CWE on the turnover of the retail location.

Changing regulatory environment in Germany

Legalization of Cannabis is an important part of the German coalition contract 2021-2025 of the so-called ‘traffic light coalition’, consisting of the Social Democratic Party (SPD), the Free Democratic Party (FDP) and the GREEN Party.

  • – In the internal coalition meeting in Castle Meseberg in May 2022 it was mandated by the German Chancellor that under the lead of Karl Lauterbach, Minister of Health in conjunction with Marco Buschmann, Minister of Justice and Cem Özdemir, Minister of Agriculture a draft for a law for the legalization of Cannabis shall be presented until the end of 2022
  • – First sales of legal recreational cannabis in Germany are estimated to occur at the end of 2023
  • – To prepare the draft of the Cannabis Control Law five rounds of closed expert hearings are scheduled around the topics of:
    1. Health and consumer protection
    2. Youth protection and prevention
    3. Supply chains and economic issues
    4. Criminal liability, control measures and licensing
    5. International experience
  • – Two executives of HANF in positions to participate in the law making


Upon closing of the Transaction, the board of directors of Cann-Is shall be reconstituted, to be comprised of the nominees of CWE to consist of at least three (3) members. Upon closing of the Transaction, the management, board of directors and insiders of the Resulting Issuer will be as set forth below. CWE has appointed Aaron Meckler as the Chief Financial Officer, Director, and Corporate Secretary.

Jörn J. Follmer – Chief Executive Officer and Director

Jörn Follmer is a serial entrepreneur that has sold his company to a NASDAQ firm in 1999, built up another company to take it public at the EU-regulated market General Standard segment of Deutsche Börse in 2005. As co-founder of DCI, Jörn has consulted with Wenzel Cerveny since they met in 2016 on the campaign trail. In 2008, Jörn became an investment banker, who has since taken public more than 40 companies as official listing partner of various exchanges. Similar to his position in CWE, Jörn takes financial positions in emerging market companies. Having served on the board of directors of listed companies in Europe, he has relevant experience in going public transactions and continuous disclosure obligations. Mr. Follmer received an M.B.A. degree in 1991 from Texas Christian University.

James Lanthier – Director

Mr. Lanthier is the Chief Executive Officer of Mindset Pharma Inc., a drug discovery and development business focused on developing novel drugs for neuropsychiatric conditions. Mr. Lanthier has held executive positions at a number of technology enabled companies; prior to Mindset, Mr. Lanthier helped found Future Fertility, a provider of artificial intelligence tools to infertility physicians. Mr. Lanthier was a member of the founding management team of Mood Media (“Mood“), the world’s largest in-store media business. Mr. Lanthier was the Chief Operating Officer of Mood from 2008 to 2013 and a non-executive Director of Mood from 2013 – 2016. Prior to Mood, Mr. Lanthier co-founded FUN Technologies, a casual games business that he helped lead as Chief Financial Officer through its initial public offering on the Toronto and London Stock Exchanges through its eventual sale to Liberty Media. Mr. Lanthier has held board positions at a number of public companies. Mr. Lanthier serves as a member of the board and audit committee of Water Ways Technologies Inc. and a member of the board of Cann-Is. Mr. Lanthier holds an MBA from the Rotman School of Management at the University of Toronto and a BA (Honors) from Queens University.

Aaron Meckler – Chief Financial Officer and Director

Aaron Meckler is an investment banker and seasoned corporate finance professional with experience in both public and private capital markets across a wide range of sectors, including real estate, technology, esports and cannabis. He has been involved in multiple public listings, and has advised companies across both the buy and sell side M&A transactions. Mr. Meckler provides CFO support to multiple reporting issuers and is presently the CFO and Director of Amuka Capital, a boutique investment and merchant banking firm in Toronto, Ontario. Mr. Meckler holds a B.Com from York University, the Chartered Investment Manager (CIM) designation and the Fellow of CSI (FCSI) designation.

Ronnie Jaegermann – Director

Mr. Jaegermann has been a Venture Partner at Exiteam Capital Partners, an Israeli Venture Capital and Investment Advisory Firm since November 2020. Prior to that, he was a Venture Partner at Beyond-Ventures, an Israeli Venture Capital and Investment Advisory Firm since September 2019. Prior to that, Mr. Jaegermann was the Chief Executive Officer and Head of Investment Banking Advisory at Aloni Haft, a Tel Aviv-based boutique investment bank focused on fundraisings for Israeli companies in international capital markets since 2014. He has led multiple businesses in growing them from start-up to profitable companies that became take-out targets and was involved in fundraisings and public offerings for Israeli technology companies both in Europe and the USA. Mr. Jaegermann has owned a few retail and online ventures including a retail chain of 26 Lingerie shops in Israel. Mr. Jaegermann holds a BA in Economic and Political Science from Tel Aviv University. Mr. Jaegermann serves as Chief Financial Officer of Cann-Is, an independent member of the board of directors of Adcore Inc. and a member of the board and audit committee of Water Ways Technologies Inc.

Jerry Cerveny – Director

Jerry Cerveny is the Chief Executive Officer of DCI GmbH, which is the operating subsidiary of CWE since 2019. Between 2012 and 2019, Mr. Cerveny was the manager of a technology venture in New Zealand developing nanoparticles. Between 2003 and 2016, Mr. Cerveny held executive positions at BP Oil NZ Ltd. Between 1999-2003 he was a Manager at Shell NZ Ltd.


In connection with the Transaction, Cann-Is expects to file a filing statement which will contain details regarding the Transaction, Cann-Is, CWE and the Resulting Issuer.


The Corporation is a Capital Pool Company (“CPC“). It has not commenced commercial operations and has no assets other than a minimum amount of cash. Except as specifically contemplated in the CPC Policy, as defined in the final prospectus, until Completion of the Transaction, the Corporation will not carry on any business other than the identification and evaluation of assets or businesses with a view to completing a proposed Transaction.


Completion of the Transaction is subject to a number of conditions, including but not limited to, Exchange acceptance and if applicable pursuant to Exchange requirements, majority of the minority shareholder approval. Where applicable, the Transaction cannot close until the required shareholder approval is obtained. There can be no assurance that the Transaction will be completed as proposed or at all.

Investors are cautioned that, except as disclosed in the management information circular or filing statement to be prepared in connection with the Transaction, any information release or received with respect to the Transaction may not be accurate or complete and should not be relied upon. Trading in the securities of a capital pool company should be considered highly speculative.

The TSX Venture Exchange Inc. has in no way passed upon the merits of the Transaction and has neither approved nor disapproved the contents of this press release.


This news release does not constitute an offer to sell or the solicitation of an offer to buy any securities in any jurisdiction.


This news release contains certain forward-looking statements, including statements relating to the Transaction and certain terms and conditions thereof, the ability of the parties to complete the Transaction, the Financing, the Exchange Ratio, the Name Change, the Resulting Issuer’s ability to qualify as a Tier 2 Issuer, the Corporation receiving a waiver from the Exchange for sponsorship requirements, shareholder, director and regulatory approvals, future press releases and disclosure, and other statements that are not historical facts. Wherever possible, words such as “may”, “will”, “should”, “could”, “expect”, “plan”, “intend”, “anticipate”, “believe”, “estimate”, “predict” or “potential” or the negative or other variations of these words, or similar words or phrases, have been used to identify these forward-looking statements. These statements reflect management’s current beliefs and are based on information currently available to management as at the date hereof.

Forward-looking statements involve significant risk, uncertainties and assumptions. Many factors could cause actual results, performance or achievements to differ materially from the results discussed or implied in the forward-looking statements. As a result, the Corporation cannot guarantee that the Transaction will be completed on the terms described herein or at all. These factors should be considered carefully, and readers should not place undue reliance on the forward-looking statements. Although the forward-looking statements contained in this press release are based upon what management believes to be reasonable assumptions, the Corporation cannot assure readers that actual results will be consistent with these forward-looking statements. These forward-looking statements are made as of the date of this press release, and the Corporation assumes no obligation to update or revise them to reflect new events or circumstances, except as required by law.

SOURCE Cann-Is Capital Corp.

For further information:

Cann-Is Capital Corp.
Jonathan Graff
Chief Executive Officer
Telephone: (416) 862-3558
Email: [email protected]

CWE European Holdings Inc.
Jörn J. Follmer
Chief Executive Officer
Telephone: +49 (172) 390-1107
Email: [email protected]

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