Halo Announces the Agreement to Acquire a Dispensary Application Software Company and a Concurrent Private Placement
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.