Invictus Signs Agreement To Purchase Up To 75% Of Future Harvest Development Ltd.; Announces Private Placement
ACCESS Newswire
VANCOUVER, BC / ACCESSWIRE / March 4, 2015 / INVICTUS MD STRATEGIES CORP. (formerly BioAB Strategies Ltd.) ("Invictus MD" or the "Company") (CSE:IMH) is pleased to announce that it has entered into an agreement to indirectly acquire up to 75%, over a period of eight months, of the shares of Future Harvest Development Ltd. ("Future Harvest") a company located in Kelowna, B.C., for an aggregate purchase price of up to $1,875,000.
About Future Harvest
For over 20 years, Future Harvest has brought innovative products and solutions to the hydroponic and indoor growing industries. Future Harvest's product lines are available through leading distributors and retailers across North America, the United Kingdom and Europe and include SunBlaster Lighting(TM), Nutradip, Plantlife Products and Future Harvest Plastics, as well as the Nano-Dome and Grow Light Garden systems currently sold at major hardware and home garden centers across North America.
The SunBlaster Lighting(TM) line has introduced a variety of innovative lighting products to both the hydroponic and indoor growing industries. SunBlaster T5HO lighting fixtures and CFL self ballasted lamps are industry leaders and a great example of Future Harvest's commitment to providing customers with the best possible lighting for all their growing needs.
Future Harvest has been manufacturing metering and monitoring equipment for over fifteen years. The most popular and industry standard is the Trimeter, made famous because a single glance tells you if your pH, nutrients and temperatures are on target. All Nutradip and SunBlaster products are developed, designed, tested and assembled in Canada.
Plantlife Products consists of 29 proprietary formulas that offer growers the leading edge in sediment free plant nutrition. Every product has been developed and tested in-house by Future Harvest's own plant scientists.
Terms of the Transaction
The Company will initially acquire 20% of the Future Harvest shares for $500,000, which includes a $40,000 deposit already paid. The Company will have the option to acquire up to an additional 55% in four purchases of 13.75% of the Future Harvest shares on each of 60, 120, 180 and 240 days after the date of the initial purchase. The purchase price for each additional block of Future Harvest shares is $343,750. The vendors are entitled to elect to receive payment in common shares of the Company ("Invictus shares") issued at a deemed per share price equal to the average closing price for the ten trading days ending on the fifth business day prior to the applicable payment date less a 10% discount, subject to any minimum price required under applicable stock exchange rules. Each installment of the purchase price is subject to a working capital adjustment.
The Company will complete the acquisition of Future Harvest shares indirectly through Prestige Worldwide Holdings Inc. ("Prestige"), a British Columbia company. Management of Prestige will assume a leadership role in Future Harvest. The share purchase agreement provides for 1,710,000 Invictus shares to be issued at closing and performance Invictus shares to be issued as follows:
(a)1,822,500 Invictus shares if the Company acquires the first additional block of 13.75% of the Future Harvest shares, based on the following release schedule: (i)1,050,000 shares on the later of (i) December 31, 2015 and (ii) 45 days after Future Harvest achieves a $1 million EBITDA milestone (the "EBITDA $1 million Date"); and (ii)772,500 shares on the later of (i) June 30, 2016 and (ii) 45 days after the EBITDA $1 million Date. (b)1,822,500 Invictus shares if the Company acquires the second additional block of 13.75% of the Future Harvest shares, based on the following release schedule: (i)607,500 shares on the later of (i) June 30, 2016 and (ii) 45 days after the EBITDA $1 million Date; (ii)180,000 shares on the later of (i) June 30, 2016 and (ii) 45 days after Future Harvest achieves a $2 million EBITDA milestone (the "EBITDA $2 million Date"); and (iii)1,035,000 shares on the later of (i) December 31, 2016 and (ii) 45 days after the EBITDA $2 million Date. (c)1,822,500 Invictus shares if the Company acquires the third additional block of 13.75% of the Future Harvest shares, based on the following release schedule: (i)525,000 shares on the later of (i) December 31, 2016 and (ii) 45 days after the EBITDA $2 million Date; (ii)690,000 shares on the later of (i) June 30, 2017 and (ii) 45 days after the EBITDA $2 million Date; and (iii)607,500 shares on the later of (i) June 30, 2017 and (ii) 45 days after Future Harvest achieves a $3 million EBITDA milestone (the "EBITDA $3 million Date"). (d)1,822,500 Invictus shares if the Company acquires the fourth additional block of 13.75% of the Future Harvest Shares, based on the following release schedule: (i)262,500 shares on the later of (i) June 30, 2017 and (ii) 45 days after the EBITDA $3 million Date; and (ii)1,560,000 shares on the later of (i) December 31, 2017 and (ii) 45 days after the EBITDA $3 million Date.
On closing, Prestige will be a wholly-owned subsidiary of the Company whose only asset will be the Future Harvest shares acquired on behalf of the Company. The Company's obligations to issue the performance shares will expire if the milestones are not achieved by December 31, 2018 or if management of Prestige ceases to have a role with Future Harvest.
The transactions are subject to customary closing conditions and, in the case of the Future Harvest transaction, completion of the purchase of Prestige by the Company. If all closing conditions are satisfied, closing of the purchase of Prestige and the initial purchase of Future Harvest Shares is expected to occur on March 5, 2015. All shares issued in connection of the transactions will be subject to a four month securities law hold period.
Private Placement
The Company also announces a non-brokered private placement (the "Offering") through the issuance of up to 5,000,000 common shares at a price of $0.15, for gross proceeds of up to $750,000. Proceeds from the Offering will be used to fund the acquisition of the contemplated transaction as described above, to pursue other synergistic business opportunities, and for general working capital to continue to develop the Company's recent acquisitions. Finder's fees on the Offering may be paid, and the securities issued will be subject to a four-month hold from the date of issuance.
About Invictus MD Strategies Corp.
Invictus MD is focused on acquiring, investing in and developing businesses that provide products and services relating to the medical marijuana sector in North America and internationally.
The Company identifies businesses with high growth potential that are involved in the following:
-The production of medical marijuana
-Patient services and product distribution
-Accessories and other products used in the consumption of medical marijuana
-Other products and services related to marketing and patient management
For further information, please contact:
Dan Kriznic, Chief Executive Officer & Director
Phone: 604-368-6437
Forward-Looking Statements
Except for statements of historical fact, this news release contains certain "forward-looking information" within the meaning of applicable securities laws. Forward-looking information, also referred to below as forward-looking statements, is frequently characterized by words such as "plan", "expect", "project", "intend", "believe", "anticipate", "estimate" and other similar words, or statements that certain events or conditions "may" or "will" occur. Forward-looking statements are based on the opinions and estimates of management at the date the statements are made, and are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those anticipated in the forward-looking statements, including, among others closing of the Prestige and the Future Harvest acquisition transactions and the proposed private placement and the use of proceeds from the private placement. There can be no assurance that such statements will prove to be accurate and actual results and future events may vary from those anticipated in such statements. The forward-looking statements in this news release were developed based on certain assumptions, factors and expectations of management, including that all conditions to completion of the proposed transactions will be satisfied and any required fundraising will be obtained. Important risk factors that could cause actual results to differ materially from the Company's plans or expectations include the risk that closing conditions will not be satisfied or waived, that the proposed transactions will not be completed as planned and that any required financing will not be obtained. The Company undertakes no obligation to update forward-looking information if circumstances or management's estimates or opinions should change except as required by law. The reader is cautioned not to place undue reliance on forward-looking statements. More detailed information about potential factors that could affect projected results is included in the documents filed from time to time with the Canadian securities regulatory authorities by the Company.
