VANCOUVER, BC / ACCESSWIRE / January 10, 2020 / Mota Ventures Corp. (CSE:MOTA)(FSE:1WZ:GR)(OTC:PEMTF) (the “Company” or “Mota Ventures“) is pleased to announce that it has entered into a binding agreement (the “Transaction Agreement“) dated January 9, 2020, with VIDA BCN LABS SL (Spain) and Sativida OU (Estonia) (collectively, “Sativida“) under which the Company has been granted the right to acquire Sativida (the “Transaction“). Sativida is an arms’-length producer and online retailer of cannabidiol (“CBD“) and branded CBD products in various jurisdictions in Europe, including Spain, Portugal, Austria, Germany, France and the United Kingdom.
Sativida currently develops and retails a vast range of organic CBD oils and cosmetics across Europe and is in the process of expanding its distribution network internationally to include the United States. Sativida has become the number one search-ranked online retailer of CBD products in Spain and Mexico, and intends to continue its expansion into other countries in Europe and Latin America.
Joel Shacker, CEO of the Company, commented, “We are excited to be at the forefront of the expansion of the CBD market in Europe and internationally. Currently, product availability and consumer awareness is in its infancy and the market is fragmented. The acquisition of an established brand such as Sativida is a great opportunity to both enter and expand in Europe. Using our newly formed and integrated infrastructure, we plan to rapidly capture market share and consolidate consumer bases across Europe. Sativida is the cornerstone for our entry into that market.”
In accordance with the Transaction Agreement, the acquisition of Sativida will proceed in stages, at the discretion of the Company, as certain corporate and intellectual property registrations are completed. Initially, the Company will establish a wholly-owned Spanish subsidiary (“Spanish Subco“), and Sativida will coordinate the registration of various intellectual property and trade names associated with its business operations. Spanish Subco will then acquire the intellectual property and trade names of Sativida, and will license both back to Sativida in exchange for a royalty associated with the gross revenues generated by Sativida. The Company also holds the right to acquire, through Spanish Subco, all of the outstanding share capital of Sativida at any time.
Following completion of the initial licensing arrangement, the Company expects to provide Sativida with contacts to distributors and partners across Europe and North America to allow for expansion of the Sativida brand, as well as logistical and financial support.
Consideration for the Transaction will be made up of an initial component of €2,000,001 (the “Initial Consideration“) and an earn-out component made up of three milestone payments based upon the revenue of Sativida (each, a “Milestone Payment“).
The Initial Consideration will be payable in common shares of the Company (the “Consideration Shares“), which will be determined by dividing the amount due by the lesser of (i) the volume weighted average closing price of the Company’s common shares on the Canadian Securities Exchange in the ten trading days prior to Sativida obtaining the Spanish national trademark for “Sativida”; and (ii) Cdn$0.85.
Each Milestone Payment will be based on a multiple of Sativida’s revenue of 400% until the aggregate of the Initial Consideration and Milestone Payments reaches €4,000,000, at which point the multiple will be reduced to 100%. In no event will the combined Milestone Payments and the value of the Initial Consideration exceed €15,000,000. Payment of the Milestone Payments will be satisfied by the Company issuing common shares (“Milestone Shares“) to Sativida. The total number of Milestone Shares issuable to Sativida will be determined by dividing the amount due by the volume weighted average closing price of the Company’s common shares on the Canadian Securities Exchange in the ten trading days prior to the day that the Milestone Payment is due.
The Consideration Shares and the Milestone Shares will each be subject to a 36-month pooling arrangement such that 10% of the Consideration Shares, or the Milestone Shares, as applicable, will be released from escrow on upon their issuance, with an additional 15% being released every six-months thereafter until all Consideration Shares or all Milestone Shares, as applicable, are released.
As part of the Transaction, Mota Ventures will enter into employment contracts with certain employees of Sativida and will provide an option pool that may be divided among the employees of Sativida equal to €60,000 in stock options of Mota Ventures for every €1,000,000 in revenue that Sativida earns, subject to certain conditions. Additionally, Mota Ventures will pay a 10% finder’s fee on the total value of the Consideration Shares, upon issuance of the Consideration Shares, to certain finders that assisted in introducing the Transaction to the parties.
Completion of a licensing transaction with Sativida remains subject to the establishment of Spanish Subco, the registration of certain intellectual property rights associated with the Sativida brand, the negotiation of a definitive license agreement and certain due diligence considerations. The Company will provide additional information regarding the licensing arrangement with Sativida as soon as it becomes available.
The Company and Sativida are at arms’-length. The Transaction is not expected to result in a “reverse-takeover” or “fundamental change” for the Company under the policies of the Canadian Securities Exchange, or result in the creation of any new insider or control person of the Company. No changes to the board of directors, or management, of the Company are contemplated in connection with the Transaction.
About Mota Ventures Corp.
Mota Ventures is seeking to become a vertically integrated global CBD brand. Its plan is to cultivate and extract CBD into high-quality value added products from its Latin American operations and distribute it both domestically and internationally. Its existing operations in Colombia consist of a 2.5-hectare site that has optimal year round growing conditions and access to all necessary infrastructure. Mota Ventures is also seeking to acquire revenue producing CBD brands and operations in both Europe and North America, with the goal of establishing an international distribution network for CBD products. Low cost production, coupled with international, direct to customer, sales channels will provide the foundation for the success of Mota Ventures.
Sativida is a producer and online retailer of CBD and branded CBD products in various jurisdictions in Europe, including Spain and the United Kingdom. Sativida currently develops and retails a vast range of organic CBD oils and cosmetics across Europe and is currently expanding its distribution network internationally. For more information on Sativida, readers are encouraged to review their website, www.sativida.es.
On Behalf of the Board of Directors of
MOTA VENTURES CORP.
Chief Executive Officer
The Canadian Securities Exchange has in no way passed upon the merits of the Transaction, and has neither approved nor disapproved the contents of this press release.
All statements in this press release, other than statements of historical fact, are “forward-looking information” with respect to the Company within the meaning of applicable securities laws including with respect to the completion of the acquisition of Sativida, the expansion of Sativida’s business and its cultivation operations in Colombia. When or if used in this news release, the words “anticipate”, “believe”, “estimate”, “expect”, “target, “plan”, “forecast”, “may”, “schedule” and similar words or expressions identify forward-looking statements or information. The Company provides forward-looking statements for the purpose of conveying information about current expectations and plans relating to the future, and readers are cautioned that such statements may not be appropriate for other purposes. By its nature, this information is subject to inherent risks and uncertainties that may be general or specific and which give rise to the possibility that expectations, forecasts, predictions, projections or conclusions will not prove to be accurate, that assumptions may not be correct and that objectives, strategic goals and priorities will not be achieved. These risks and uncertainties include but are not limited those identified and reported in the Company’s public filings under the Company’s SEDAR profile at www.sedar.com. Although the Company has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking information, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. Such factors include the result of further due diligence investigation of the business and operations of Sativida. There can be no assurance that such information will prove to be accurate as actual results and future events could differ materially from those anticipated in such statements. The Company disclaims any intention or obligation to update or revise any forward-looking information, whether as a result of new information, future events or otherwise unless required by law.
SOURCE: Mota Ventures Corp.
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