PureK Holdings Corp. (the "
Company") (TSX
Venture: PKAN), along with its majority-owned CBD subsidiary
company, PureKana, LLC, ("
PureKana"), is pleased
to announce that, on February 18, 2021, it has closed on its
previously announced acquisition on of all of the outstanding
membership interests of No B.S. Life, LLC ("
No B.S.
Skincare"), an industry-leading clean-formula skin care
and beauty company. All figures in this news release are in U.S.
dollars, unless otherwise indicated.
No B.S. Skincare was founded to provide
consumers a clean and environmentally friendly alternative to the
excesses of the beauty industry. No B.S. Skincare’s products are
made with potent, plant-based and scientifically proven ingredients
and – unlike other skincare solutions - with absolutely no harmful
chemicals like parabens, sulfates, or phthalates, and no synthetic
fragrances. All of their products are responsibly made in America
and are never tested on animals.
In addition to the closing of the acquisition,
the Company is pleased to announce that all No B.S. Skincare
products, including its Award-Winning Caffeine Eye Cream and
Retinol Night Cream, Charcoal Peel-Off Mask, Moisturizers, Serums,
Toner, Cleanser, and Acne Patches, will become available through
the website of major retailer Target beginning on or about February
28, 2021.
Key focuses of growth for PureK Holdings Corp.
are in the skincare and pet categories, global market entries and
omni-channel expansion. With the addition of No B.S. Skincare to
its portfolio, PureK Holdings Corp. is positioned to capitalize on
what is expected to be strong growth in both the global skin care
and beauty markets and in the CBD consumer products market. The
global CBD-infused skincare market is expected to reach $3.2
billion by 2025, with an estimated compound annual growth rate
(CAGR) of over 25% in that time, according to Allied Market
Research. The global skincare market was estimated to total
approximately $198.3 billion by 2025, according to Statista.
Moreover, the Company sees significant tailwinds in its current
plant-based portfolio. According to Meticulous Research, the
plant-based products category is forecast to reach $74.2 billion by
2027, growing at a CAGR of 11.9%.
“No B.S. Skincare’s unique approach to its
portfolio is a perfect fit to fuel PureK Holdings’ holistic
wellness growth strategy,” said Kathy Casey, CEO of PureK Holdings
Corp. “We see synergies in our joint mission to democratize
plant-based wellness through the powerful combination of nature and
science.”
The Acquisition
Under the terms of the acquisition, PureK
Holdings Corp. and its majority-owned subsidiary, PureKana,
acquired all of the issued and outstanding membership interests of
No B.S. Life, LLC, with 65% of the purchase price to be paid by
PureK Holdings Corp. and 35% to be paid by PureKana, with resulting
proportional ownership interests.
PureK Holdings Corp. issued $4 million payable
in unsecured convertible debentures, with 3.25% non-compounding
interest, payable in cash or common shares of PureK Holdings Corp.,
with a maturity date of twenty-four (24) months following the date
of closing. Under the terms of the convertible debentures, the
Seller has the option, on a monthly basis after the issuance of the
convertible debentures, to convert any portion thereof (including
accrued interest on such portion) into common shares of the
Company, provided that the Seller shall not hold, at any time, in
excess of 7% of the then current issued and outstanding common
shares of the Company. Any portion or all of the convertible
debentures which have not been so converted into common shares
shall be payable in cash at the maturity date. The conversion price
of the convertible debentures shall be the higher of CAD$10.00 and
the volume weighted average price of the Company's shares
determined based on the 15 trading days immediately preceding the
date of notice of conversion (the "VWAP"). In
addition, the Company will make a cash payment of $500,000 within
six (6) months of the date of closing. PureKana paid a refundable
deposit in the amount of $1.5 million, in addition to the $1
million cash payment on closing.
The Seller is eligible to receive earnout
compensation of $1 million if the company’s revenues and EBITDA
equal or exceed $6 million and $360,000, respectively, in fiscal
2021, and/or $2.5 million if the company’s revenues and EBITDA
exceed $8 million and $480,000, respectively, in fiscal 2022. Any
earnout amounts will be payable in cash or in the form of common
shares of the Company, valued using the higher of CAD$10.00 and the
VWAP at the time of payment.
About PureK Holdings Corp.
PureK Holdings Corp. leads an international
omni-channel platform with diversified assets in the emerging
plant-based and holistic wellness consumer product categories. The
company’s mission is focused on leading innovation for the informed
Millennial and Generation Z generations in the rapidly growing
plant-based, natural, and clean ingredient space. The company
continues to focus on expansion into high-growth consumer product
categories including CBD products, plant-based food and beverage,
and the global pet care and skin care industries. For more
information on PureK Holdings Corp., please visit
https://purekana.com/investor-relations/.
For further information:
Brian MeadowsChief Financial OfficerPh: +1 (855) 553-7441Email:
ir@purekana.com
Daniel NussbaumMedia and Investor RelationsPh: +1 (917)
232-8960Email: Daniel@amwpr.com
Forward-Looking Information
Certain statements contained in this news
release constitute "forward-looking information" and
"forward-looking statements" as such terms are used in applicable
Canadian securities laws. Forward-looking statements and
information are based on plans, expectations and estimates of
management at the date the information is provided and are subject
to certain factors and assumptions, including, that the Company’s
financial condition and development plans do not change as a result
of unforeseen events. Forward-looking statements and information
are subject to a variety of risks and uncertainties and other
factors that could cause plans, estimates and actual results to
vary materially from those projected in such forward-looking
statements and information. Factors that could cause the
forward-looking statements and information in this news release to
change or to be inaccurate include, but are not limited to, the
risk that any of the assumptions referred to prove not to be valid
or reliable, that occurrences such as those referred to above are
realized and result in delays, or cessation in planned work, that
the Company’s financial condition and development plans change, and
delays in regulatory approval, as well as the other risks and
uncertainties applicable to the CBD industry and to the Company, as
set forth in the Company’s Filing Statement in respect of its
qualifying transaction filed under the Company’s profile at
www.sedar.com. The Company undertakes no obligation to update the
forward-looking statements and information, other than as required
by applicable law.
Neither the TSX Venture Exchange nor its
Regulation Services Provider (as that term is defined in the
policies of the TSX Venture Exchange) accepts responsibility for
the adequacy or accuracy of this press release.
A photo accompanying this announcement is available at
https://www.globenewswire.com/NewsRoom/AttachmentNg/ba961165-7b51-46ff-9fa1-237846ef133e
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