TORONTO--(BUSINESS WIRE)--Halo Labs Inc. ("Halo" or the "Company") (NEO: HALO, OTCQX: AGEEF, Germany: A9KN) is pleased to announce it has entered into a definitive agreement (the “Agreement”) to acquire all of the common shares of Cannpos Services Corp. (“Cannpos”) for (i) CAD $4.69 million in Halo common shares at a deemed price of CAD $0.26 per share; and (ii) 1,250,000 performance warrants, subject to vesting and exercise restrictions, to purchase 1,250,000 Halo common shares (the "Acquisition").
Cannpos is a software company that is developing an application to alleviate customer flow constraints currently experienced by dispensaries. Subject to state and local regulations, once fully functional, the application will enable customers to electronically interact with dispensaries, thereby reducing wait times and improving customer experience. Dispensaries will also be able to use the application to display in-store specials, advertise specific products, and track customers’ purchasing patterns. The application’s tracking capabilities will enable dispensaries and Halo to gather business intelligence on end customers, in compliance with privacy laws. The application is being designed to be used on a smart phone or tablet and is expected to be available on the Apple and Android app stores once complete and tested. Halo intends to rebrand the application as “DispensaryTrack” and offer it to its retail partners for an ongoing monthly service fee.
“Securing shelf space is highly competitive and being able to add to Halo’s value proposition will lead to a stronger bottom line in the long term,” said Kiran Sidhu, CEO and Co-Founder of Halo. “The Company believes that DispensaryTrack will provide its sales force with a unique selling proposition to key dispensary clients, which in turn should foster longer term relationships”.
The Acquisition is expected to be completed through a three-cornered amalgamation whereby Halo will acquire 100% of Cannpos’ outstanding common shares from its shareholders in exchange for 18,035,714 Halo common shares and 1,250,000 performance warrants. The performance warrants will only vest and become exercisable when the application has been custom designed to meet Halo’s specifications within one year after closing of the Acquisition. The Agreement requires the existing developers to work with the Company to develop the application and provide for a smooth transition. The common shares issued by Halo in conjunction with the Acquisition will be subject to certain sale restrictions.
Concurrent Non-Brokered Private Placement
As a condition to closing of the Acquisition, Halo is pleased to announce a concurrent non-brokered private placement of Halo common shares at a price of CAD $0.31 per share for aggregate gross proceeds of up to CAD $3 million (“Concurrent Financing”). Any securities issued in connection with the Concurrent Financing will be subject to a four month and one day statutory hold period pursuant to applicable securities laws.
Halo intends to use the proceeds of the Concurrent Financing to complete the development and deployment of DispensaryTrack and continue its expansion efforts in California, including the increase of its direct sales force and product offerings and the growth of its manufacturing capacity in Cathedral City.
Both the Acquisition and Concurrent Financing are expected to close on or before October 15, 2019 and are subject to the satisfaction or waiver of customary conditions, including the receipt of all applicable regulatory and stock exchange approvals.
Halo is a cannabis extraction company that develops and manufactures quality cannabis oils and concentrates, which are the fastest growing segments in the cannabis industry. Halo is a global leader in cannabis oil and concentrates, having produced over 4.5 million grams of oils and concentrates since inception. The Company has expertise across all major cannabis manufacturing processes, leveraging a variety of proprietary processes and products. The forward-thinking company is led by a strong management team with deep industry knowledge and blue-chip experience. The Company is currently operating in California and Oregon, as well as in Nevada with our partner Just Quality, LLC, and in Lesotho with the Bophelo strategic partnership. With a consumer-centric focus, Halo will continue to market innovative, branded, and private label products across multiple product categories.
For further information regarding Halo, see Halo’s disclosure documents 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". The forward-looking information and forward-looking statements contained herein may include, but is not limited to, statements regarding the Acquisition, the development and deployment of DispensaryTrack and the Concurrent Financing.
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. 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.