Halo Labs to Acquire Dispensary Application Software Company

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Halo Labs

TORONTO – 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.”

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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.



ABOUT HALO

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.

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