Halo Collective Announces Purchase of KushBar Retail Assets from High Tide
This news release constitutes a "designated news release" for the purposes of the Company's prospectus supplement dated May 4, 2021, to its short form base shelf prospectus dated September 2, 2020
TORONTO, July 15, 2021 /CNW/ - Halo Collective Inc. ("Halo" or the "Company") (NEO: HALO) (OTCQB: HCANF) (Germany: A9KN), a vertically integrated multinational cannabis company, is pleased to announce that, further to its press releases dated February 14, 2020, and September 1, 2020, the Company, through its wholly-owned subsidiary Halo KushBar Retail Inc. ("Halo KushBar"), has completed the purchase of certain KushBar retail cannabis assets from High Tide Inc. ("High Tide") (TSXV: HITI) (NASDAQ: HITI) (FRA: 2LYA), pursuant to the terms of an amended and restated asset purchase agreement by and among the Company, High Tide and Halo KushBar, among others (the "Purchase Agreement").
In accordance with the Purchase Agreement, Halo KushBar acquired three operating KushBar retail cannabis stores located in the province of Alberta (the "Portfolio"). In consideration for the Portfolio, the Company previously issued 13,461,538 common shares in the capital of the Company ("Halo Shares") to High Tide as a deposit, and on closing issued a convertible promissory note (the "Initial Note") to High Tide in the principal amount of $1.8 million with a conversion rate of $0.16 per Halo Share.
Under the terms of the Purchase Agreement, the Company has also agreed to issue a convertible promissory note on the 12-month anniversary of closing (the "Earnout Note" and together with the Initial Note, the "Halo Notes") in the principal amount of $400,000 with a conversion rate of $0.16 per Halo Share, provided that certain revenue thresholds are met. If the Portfolio produces aggregate revenue less than the set threshold for the prior 12 months, then the principal amount of the Earnout Note will be reduced dollar for dollar.
Each of the Halo Notes is secured solely by the Portfolio. Accordingly, there are no additional Halo SaloHaHhares or Halo Share warrants being issued.
In addition, concurrently with closing, Halo KushBar and High Tide entered into a retail management agreement under which Halo KushBar will continue to engage High Tide to substantially oversee all aspects of its retail cannabis operations with respect to the Portfolio and will pay High Tide ongoing royalties for regulatory advisory services and retail management through blended monthly payments.
"The acquisition of KushBar is Halo's first entry into Canada. Combined with our other international assets, in the U.K. and Lesotho, as well as our planned acquisitions we are well on our way to creating a large international ecosystem as many countries are relaxing cannabis restrictions," said Kiran Sidhu, CEO and Co-Founder.
About Halo Collective Inc.
Halo is a leading, vertically integrated cannabis company that cultivates, extracts, manufactures, and distributes quality cannabis flower, oils, and concentrates and has sold approximately nine million grams of oils and concentrates since inception. Halo continues to expand its business and scale efficiently, partnering with trustworthy leaders in the industry, who value Halo's operational expertise in bringing top-tier products to market.
The Company is currently operating in the United States in California and Oregon, in Southern Africa in the Kingdom of Lesotho, and in the United Kingdom. The Company sells cannabis products principally to dispensaries in the U.S. under its brands, Hush, Mojave, and Exhale, and under partnership or license with DNA Genetics, Terphogz and FlowerShop, a cannabis lifestyle and conceptual wellness brand in which G-Eazy is a partner and key member of FlowerShop. The Company has also acquired three KushBar retail cannabis stores location in the Canadian province of Alberta.
As part of continued expansion and vertical integration in the U.S., Halo boasts several grow operations throughout Oregon and two planned in California. In Oregon, the Company has a combined 9 acres of outdoor cultivation, including East Evans Creek, a six-acre grow site in Jackson County, Blue Sky Farms, a two-acre grow site located in Jackson County and Winberry Farms, a one-acre grow site located 30 miles outside Eugene in Lane County. In California, the Company is building out Ukiah Ventures, a planned 30,000-square-foot indoor grow and cannabis processing facility including up to an additional five acres of industrial land to expand this indoor grow site. Recently, Halo partnered with Green Matter Holding to purchase Bar X Farm in Lake County, developing up to 80 acres of cultivation which would comprise the largest single licensed grow in California.
Halo also has acquired a range of software development assets, including technology platforms CannPOS, Cannalift, and, more recently, CannaFeels. Halo also owns the discrete sublingual dosing technology, Accudab. The Company intends to spin-off these assets along with its intellectual property and patent applications into its subsidiary Halo Tek Inc. and complete a distribution to shareholders on a record date to be determined by Halo.
Halo has recently announced its intention to reorganize its non-U.S. operations into a newly formed Alberta corporation called Akanda Corp. ("Akanda") whose mission will be to provide high quality and ethically sourced medical cannabis products for patients worldwide. Akanda will seek to deliver on this promise while driving positive change in wellness, empowering individuals in Lesotho, and by uplifting the quality of the lives of employees and the local communities where it operates – and while limiting its carbon footprint. Akanda will combine the scaled production capabilities of Bophelo Bioscience & Wellness Pty. Ltd. ("Bophelo"), Halo's Lesotho-based cultivation and processing campus, located in the world's first Special Economic Zone (SEZ) containing a cannabis growth operation, with distribution and route-to-market through Canmart Ltd. ("Canmart"), Halo's UK-based fully approved pharmaceutical importer and distributor which supplies pharmacies and clinics within the UK. With a potential maximum licensed canopy area of 200 hectares (495 acres), Bophelo has scalability that is arguably unmatched in the world today.
For further information regarding Halo, see Halo's disclosure documents on SEDAR at www.sedar.com
Connect with Halo Collective: Email | Website | LinkedIn | Twitter | Instagram
About High Tide Inc.
High Tide is a retail-focused cannabis company enhanced by the manufacturing and distribution of consumption accessories. The Company is the most profitable Canadian retailer of recreational cannabis as measured by Adjusted EBITDA1, with 86 current locations spanning Ontario, Alberta, Manitoba and Saskatchewan. High Tide's retail segment features the Canna Cabana, Meta Cannabis Co., Meta Cannabis Supply Co. and NewLeaf Cannabis banners, with additional locations under development across the country. High Tide has been serving consumers for over a decade through its established ecommerce platforms including Grasscity.com, Smokecartel.com and Dailyhighclub.com, and more recently in the hemp-derived CBD space through CBDcity.com and FABCBD.com as well as its wholesale distribution division under Valiant Distribution, including the licensed entertainment product manufacturer Famous Brandz. High Tide's strategy as a parent company is to extend and strengthen its integrated value chain, while providing a complete customer experience and maximizing shareholder value. Key industry investors in High Tide include Tilray Inc. (TSX: TLRY) (Nasdaq: TLRY) and Aurora Cannabis Inc. (TSX: ACB) (Nasdaq: ACB).
Neither the TSXV nor its Regulation Services Provider (as that term is defined in the policies of the TSXV) accepts responsibility for the adequacy or accuracy of this release.
__________________________ |
1 Adjusted EBITDA is a non-IFRS financial measure. |
For more information about High Tide Inc., please visit www.hightideinc.com and its profile page on SEDAR at www.sedar.com.
Cautionary Note Regarding Forward-Looking Information and Statements
This press release contains certain "forward-looking information" within the meaning of applicable Canadian securities legislation and may also contain statements that may constitute "forward-looking statements" within the meaning of the safe harbor provisions of the United States Private Securities Litigation Reform Act of 1995. Such forward-looking information and forward-looking statements are not representative of historical facts or information or current condition, but instead represent only Halo's beliefs regarding future events, plans or objectives, many of which, by their nature, are inherently uncertain and outside of Halo's control. Generally, such forward-looking information or forward-looking statements can be identified by the use of forward-looking terminology such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or may contain statements that certain actions, events or results "may", "could", "would", "might" or "will be taken", "will continue", "will occur" or "will be achieved". Forward-looking information may relate to anticipated events or results including, but not limited to the issuance of the Earnout Note, Halo's planned expansion into the Canadian retail market, the expected size and capabilities of the final facility planned at Ukiah Ventures, the size of Halo's planned cultivation facility in Northern California, the ability of Bophelo and Canmart to serve international markets and Halo's intentions with respect to Akanda and its international assets.
By identifying such information and statements in this manner, Halo is alerting the reader that such information and statements are subject to known and unknown risks, uncertainties and other factors that may cause the actual results to be materially different from those expressed or implied by such information and statements. In addition, in connection with the forward-looking information and forward-looking statements contained in this press release, Halo has made certain assumptions. Although Halo believes that the assumptions and factors used in preparing, and the expectations contained in, the forward-looking information and statements are reasonable, undue reliance should not be placed on such information and statements, and no assurance or guarantee can be given that such forward-looking information and statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information and statements. Among others, the key factors that could cause actual results to differ materially from those projected in the forward-looking information and statements are the following: delays in obtaining required licenses or approvals, delays or unforeseen costs incurred in connection with construction, the ability of competitors to scale operations in Northern California, delays or unforeseen difficulties in connection with the cultivation and harvest of Halo's raw material, changes in general economic, business and political conditions, including changes in the financial markets; and the other risks disclosed in the Company's annual information form dated March 31, 2021 and other disclosure documents available on the Company's profile at www.sedar.com. Should one or more of these risks, uncertainties or other factors materialize, or should assumptions underlying the forward-looking information or statements prove incorrect, actual results may vary materially from those described herein as intended, planned, anticipated, believed, estimated or expected.
The forward-looking information and forward-looking statements contained in this press release are made as of the date of this press release, and Halo does not undertake to update any forward-looking information and/or forward-looking statements that are contained or referenced herein, except in accordance with applicable securities laws. All subsequent written and oral forward-looking information and statements attributable to Halo or persons acting on its behalf is expressly qualified in its entirety by this notice.
SOURCE Halo Collective Inc.
Contact Information, Halo Collective , Investor Relations, [email protected]
Share this article