Halo Announces an Agreement to Acquire Accu-Dab Technology and a Concurrent Private Placement

Not for Distribution to U.S. Newswire Servicers or For Dissemination in the United States

TORONTO–(BUSINESS WIRE)– Halo Labs Inc. (“Halo” or the “Company”) (NEO:HALO, OTCQX:AGEEF, Germany:A9KN) is pleased to announce that it has entered into a definitive agreement (the “Agreement”) to acquire all of the common shares of Precisa Medical Instruments Corp. (“Precisa”) for C$3,750,000 in Halo common shares at a price of C$0.28 per share (“the Acquisition”).

This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20191222005030/en/https://mms.businesswire.com/media/20191222005030/en/764364/4/accudab.jpg

(Photo: Business Wire)

Acquisition and Private Placement Highlights

  • The Accu-Dab is a convenient, precise technology to provide on the go dosing of THC or CBD products sublingually for high impact absorption
  • The Accu-Dab is a valid option for consumers in search of a non-vaporization mechanism to consume cannabis
  • The promising technology will be developed and commercialized by Halo
  • Halo will acquire Precisa in addition to concurrently placing C$1,200,000 to fund the development of Accu-Dab and continue business expansion

Precisa owns the intellectual property related to and is focused on the development of the Accu-Dab THC and CBD oil dabbing device. The Accu-Dab takes the form of a discrete pen that will allow users to pre-select various doses of measured THC or CBD from 0.01 mL to 0.60 mL for sublingual consumption. Through its convenient dial selection mechanism, the Accu-Dab allows for precise dispensation of THC or CBD product accurately and repeatedly to meet the consumer’s specific dosing needs.

Sublingual consumption of THC and CBD can be compared to inhalation in terms of bioavailability because, as in the case of absorption in the lungs, absorption from the mucous membrane under the tongue allows for the THC and CBD molecules to enter the bloodstream relatively fast and in an unmetabolized form. Studies performed by GW Pharmaceuticals showed that concentrations of THC and CBD in the blood plasma following sublingual consumption were comparable to inhalation and can also considered more consumer friendly as it removes unwanted side effects such as coughing that accompanies inhalation.

“Halo continues to provide the latest product and device technology for its customers, obtaining the latest developments in the cannabis space,” stated Kiran Sidhu, CEO and Co-Founder of Halo. “Halo, as a market exclusive licensee, introduced DabTabs™ brand doseables to allow cannabis connoisseurs enjoyment of full spectrum concentrates in a revolutionary format. Now we are developing the Accu-Dab to allow more generalized consumption through sublingual application of CBD and THC for those who are averse to vaporizing and want a discrete and accurate consumption method.”

The Acquisition is a result of arm’s length negotiations between the parties to the Agreement. It is expected to be consummated by way of a share exchange wherein Halo, through a wholly owned subsidiary, Halo Accu-Dab Holdings Inc., will acquire 100% of the issued and outstanding common shares in the capital of Precisa in exchange for 13,392,857 Halo common shares. Upon completion, Precisa will become a wholly owned subsidiary of Halo Accu-Dab Holdings Inc.

Concurrent Private Placement

As a condition to closing, Halo is pleased to announce a concurrent private placement of Halo common shares at a price of C$0.30 per share for aggregate gross proceeds that was oversubscribed from C$1,000,000 up to C$1,200,000 (the “Concurrent Financing”) led by Archytas Ventures. Halo intends to use the proceeds to complete development and distribution of the Accu-Dab and for general working capital purposes.

For facilitating the Acquisition, Halo expects to pay a finder’s fee to a third party through the issuance of 1,339,285 Halo common shares, being 10% of the Acquisition value, at C$0.30 per share.

These securities will be subject to a four month and one day statutory hold period.

Both the Acquisition and Concurrent Financing are expected to close in early January 2020 and are subject to the satisfaction or waiver of customary conditions, including the receipt of all applicable regulatory and stock exchange approvals.

Issuance of Additional Common Shares

The Company has issued an aggregate of 3,710,401 common shares (the “Compensation Shares”) to certain employees and independent contractors of the Company in lieu of cash consideration. The Company issued the Compensation Shares on December 20, 2019 at a price of C$0.265 per share and in satisfaction of C$983,257 of payables owed by the Company. None of the Compensation Shares issued are subject to a hold period. An aggregate of 566,497 of the Compensation Shares were issued to related parties (within the meaning of Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions (“MI 61-101”)) of the Company at a price of C$0.265 and in satisfaction of C$150,122 of payables owed by the Company.

In connection with the above transaction, certain “related parties” for the purposes of MI 61-101 received Compensation Shares and the issuance thereto is considered a “related party transaction” for the purposes of MI 61-101. The Company is relying on exemptions from the formal valuation and minority shareholder approval requirements available under MI 61-101. The Company is exempt from the formal valuation requirement in section 5.4 and the minority shareholder approval requirement in section 5.6 of MI 61-101 in reliance on sections 5.5(a) and 5.7(a), respectively, of MI 61-101 as the fair market value of the subject matter of, nor the fair market value of the consideration for, the transaction, insofar as it involves related parties, is not more than 25% of the Company’s market capitalization.

About Halo

Halo is a global 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 205-hectare Bophelo cultivation zone.

With a consumer-centric focus, Halo will continue to market innovative, branded, and private label products across multiple product categories. Halo recently acquired Dispensary Track platform which will alleviate customer flow constraints experienced by dispensaries and enable direct consumer interaction.

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 Accu-Dab, 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.

https://cts.businesswire.com/ct/CT?id=bwnews&sty=20191222005030r1&sid=acqr7&distro=nx&lang=en

View source version on businesswire.com: https://www.businesswire.com/news/home/20191222005030/en/

Halo Labs
Investor Relations
info@halocanna.com

Source: Halo Labs Inc.

            © Copyright Business Wire 2019