Chemesis International Inc. (CNSX:CSI) entered into binding share exchange agreement to acquire 72.72% stake in GSRX Industries Inc. (OTCPK:GSRX) from Peach Management LLC, Dorado Consulting, LLC and others for $18.6 million on August 2, 2019. Pursuant to the terms, Chemesis will acquire approximately 42.6 million common shares and 0.001 million preferred shares of GSRX, in exchange for approximately 18.9 million Chemesis common shares to be issued to the selling shareholders. Together with the GSRX common shares already held by Chemesis, completion of the acquisition will result in Chemesis holding approximately 54.3 million common shares and 0.001 million preferred shares of GSRX. The preferred shares carry, in aggregate, 51% of all outstanding share voting rights of GSRX. Accordingly, upon completion of the acquisition, Chemesis will hold an aggregate 66.29% of all outstanding share voting rights. The Chemesis consideration shares shall be subject to a 36-month leak out schedule.

The transaction was subject to due diligence, FIRPTA certificate, approval each of Chemesis and the GSRX Stockholder as applicable, the closing of a merger or consolidation of Chemesis with any corporation or other entity, other than a merger or consolidation which would result in the voting securities of Chemesis outstanding immediately prior thereto continuing to represent more than 50% of the combined voting power of the voting securities of Chemesis or such surviving entity outstanding immediately after such merger or consolidation and a transfer of all or substantially all of the assets of Chemesis pursuant to a partnership or joint venture agreement where Chemesis's resulting interest is or becomes 50% or less. Completion of the acquisition is expected to occur prior to August 31, 2019. The transaction is expected to be highly accretive in terms of the potential to realize efficiencies and complement the strengths of each company's respective business lines.

INFOR Financial Inc. acted as financial advisor to Chemesis.