Mr. Anton Mattadeen reports
RISE CLOSES DEAL TO BUY CULTIVATE KIND AND LIFE BLOOM ORGANICS
Rise Life Science Corp. has completed the previously announced acquisition of 100-per-cent interest in California-based Cultivate Kind and Life Bloom Organics.
The acquisition of Life Bloom Organics will immediately expand Rise's portfolio of cannabidiol products from sexual health and wellness products to include wellness, pain and sleep products, and provide access to Life Bloom's existing channels of distribution and production in the United States. Rise will also leverage Life Bloom's proprietary process of nanotizing CBD for increased bioavailability without psychoactivity in future products created under the Rise brand umbrella.
Integrating Cultivate Kind adds significant in-market expertise, provides immediate revenue to the company and brings U.S. distribution capabilities in-house. As a result of the transaction, Rise will move forward with a deep understanding of retail marketing; trained sales reps; and retail event and loyalty program know-how to create and expand retail presence, and maximize retailer loyalty. The addition of the new capabilities will provide the foundation to efficiently launch new Rise brands in United States markets, facilitate rapid market penetration and national growth, and leverage the full talent pool for global growth moving forward.
"The deal creates a vertically integrated corporation combining strategy with science, production with promotion, packaging with fulfilment and sales with distribution," commented Anton Mattadeen, president and chief executive officer, Rise Life Science.
"Nothing speaks like successful experience," added Mr. Mattadeen. "Cultivate Kind recently brought Life Bloom Organics to market with great success in California. We are thrilled to welcome Cultivate Kind and Life Bloom Organics to the Rise family."
"It's a science -- one that most cannabis marketing agencies have never dealt with before, and Cultivate Kind brings the experience gained from a decades-long head start," said Ryan Rocca, chief executive officer of Cultivate Kind and now, general manager, Rise Life Science, United States. "We look forward to being part of the Rise team as the expanded company moves forward in this emerging and fast-growing category."
Under the terms of the acquisition, Rise has issued two million common shares in aggregate to the sellers of Cultivate Kind and Life Bloom Organics. The common shares will be subject to the following contractual lockup provisions: (i) for the first 12 months from closing, 100 per cent of the payment shares will be subject to lock-up; (ii) after 12 months, 75 per cent of the payment shares will remain subject to lock-up; (iii) after 24 months, 50 per cent of the payment shares will remain subject to lock-up; and (iv) after 36 months, no payment shares will be subject to lock-up.
In addition, warrants to purchase one million common shares in Rise were issued at closing, each warrant having a five-year term and an exercise price of 45 cents per common share. The warrants vest as to one-third 12 months after closing, and additional one-third vest 24 months after closing and the balance of one-third vest 36 months after closing.
The sellers of Cultivate Kind and Life Bloom Organics were paid aggregate cash consideration of $500,000 (U.S.) with $175,000 (U.S.) due at closing. An additional payment of $162,500 (U.S.) will be made on June 1, 2019, with the final payment of $162,500 (U.S.) being made on June 1, 2020. The principals and key employees of Life Bloom Organics and Cultivate Kind have entered into employment contracts with Rise's U.S. subsidiary.
About Rise Life Science Corp.
Rise Life Science develops cutting-edge cannabis consumer products for both medical and adult-use markets around the world in jurisdictions that have legal regulatory frameworks in place. All products are based on patent-pending formulations and processes to produce specifically targeted effects. A key area of focus for Rise is research-based formulations to address adult sexual health and wellness for both women and men.
About Cultivate Kind
Brand strategy agency Cultivate Kind specializes in full-service brand development, go-to-market strategy and retail marketing. Headquartered in Malibu, Calif., the executive team specializes in brand pathfinding with an extensive background in food and beverage, consumer products, wine and spirits, fashion and retail, automotive, and entertainment, which informs the company's best practices and tactical programs for new consumer.
About Life Bloom Organics
Life Bloom Organics produces and markets nanotized, hemp-based CBD wellness and sleep aid oral sprays with non-genetically modified organism, all-natural ingredients. Life Bloom's proprietary process of nanotizing CBD allows for 95-per-cent absorbency in the bloodstream, making it an effective aid for chronic pain, jet lag and insomnia.
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