Halo Labs Inc. (“Halo” or the “Company“) (NEO: HALO, OTCQX: AGEEF, Germany: A9KN) is pleased to announce that it intends to complete a non-brokered private placement of convertible debentures (each, a “Convertible Debenture“) for aggregate gross proceeds of up to C$3 million (the “Offering“).

This financing, combined with the remaining C$9 million available under our existing lending arrangement, will strategically position the Company to take advantage of current market conditions and continue expanding our business through the acquisition of complementary assets where pricing is favorable

Each Convertible Debenture will consist of one C$1,000 principal amount unsecured convertible debenture of the Company. The Convertible Debentures will bear interest at a rate of 11.0% per annum, payable monthly in arrears until maturity and will have a maturity date of 24 months from the date of issuance.

The Convertible Debentures will be convertible, at the option of the holder, into Halo common shares (“Common Shares”) at any time prior to the close of business on the business day immediately preceding the maturity date, at a conversion price equal to C$0.20 per Common Share (the “Conversion Price“). The Company will also have the right to require the holders of the Convertible Debentures to convert all of the principal amount of the then outstanding Convertible Debentures at the Conversion Price on not less than thirty (30) days’ notice should the ten (10) day volume weighted average trading price of the Common Shares be greater than C$0.40 on the NEO Stock Exchange (the “NEO“).

Louisa Mojela, who is expected to become a director and Chairman of the board of directors of Halo upon the closing of Halo’s proposed acquisition of Bophelo Bioscience & Wellness (Pty) Ltd. (“Bophelo”) has committed to subscribe for C$1.4 million of Convertible Debentures and current Halo directors, shareholders and members of senior management have indicated that they will be subscribing for at least an aggregate of C$300,000 of Convertible Debentures.

“This financing, combined with the remaining C$9 million available under our existing lending arrangement, will strategically position the Company to take advantage of current market conditions and continue expanding our business through the acquisition of complementary assets where pricing is favorable,” stated Kiran Sidhu, Chief Executive Officer of Halo.

The proceeds from the Offering will be used by the Company to continue fund Bophelo’s build out, as well as for general corporate purposes, including potential acquisitions. Halo remains working capital positive.

The Offering is expected to close prior to the end of March 2020.

The Convertible Debentures will be offered on a private placement basis in all Provinces and Territories of Canada, and in the United States on a private placement basis in reliance on exemption(s) from the requirements of the United States Securities Act of 1933, as amended and in compliance with applicable United States federal securities laws and any “blue sky” laws or regulations of any state of the United States, and in such jurisdictions outside of Canada and the United States as determined by the Company on a private placement or equivalent basis.

The Offering is subject to certain conditions, including but not limited to, the receipt of all necessary regulatory and stock exchange approvals, including the approval of the NEO.

The Convertible Debentures issued pursuant to the Offering and any Common Shares issued on conversion of the Convertible Debentures will be subject to a statutory hold period in Canada of four months and one day following the closing of the Offering in accordance with applicable securities laws. Additional resale restriction may be applicable under the laws of other jurisdictions.

One or more related parties of the Company may acquire Convertible Debentures under the Offering. Such participation will be considered to be “related party transactions” within the meaning of Multilateral Instrument 61-101 Protection of Minority Security Holders in Special Transactions (“MI 61-101“). The Company intends to rely on the exemptions from the formal valuation and minority shareholder approval requirements of MI 61-101in respect of related party participation in the Offering as neither the fair market value (as determined under MI 61-101) of the subject matter of, nor the fair market value of the consideration for, the transaction, insofar as it involves interested parties, is expected to exceed 25% of the Company’s market capitalization. In the event of participation of any related parties of a director of the Company, such director discloses such participation and shall abstain from voting on the approval by the board of directors.

About Halo

Halo is a leading cannabis cultivation, manufacturing, and distribution company that grows and extracts and processes quality cannabis flower, oils, and concentrates and has sold over 5 million grams of oils and concentrates since inception. Additionally, Halo has continued to evolve its business through delivering value with its products and now via verticalization in key markets in the United States and Africa with planned expansion into European and Canadian markets. With a consumer-centric focus, Halo markets innovative, branded, and private label products across multiple product categories.

Recently, the Company entered into binding agreements to acquire a dispensary in Los Angeles, 3 KushBar branded dispensaries, 5 development permits in Alberta Canada, and Canmart Limited which holds wholesale distribution and special licenses allowing the import and distribution of cannabis based products for medicinal use (CBPM’s) in the United Kingdom. Halo is led by a strong, diverse management team with deep industry knowledge and blue-chip experience. The Company is currently operating in the United States in California, Oregon, and Nevada while having an international presence in Lesotho within a planned 205-hectare cultivation zone via Bophelo Bioscience & Wellness (Pty) Ltd. as well as planned importation and distribution in the United Kingdom via Canmart.

For further information regarding Halo, see Halo’s disclosure documents on SEDAR at www.sedar.com.

Cautionary Note Regarding Forward-Looking Information and Statements

This press release contains certain “forward-looking information” within the meaning of applicable Canadian securities legislation and may also contain statements that may constitute “forward-looking statements” within the meaning of the safe harbor provisions of the United States Private Securities Litigation Reform Act of 1995. Such forward-looking information and forward-looking statements are not representative of historical facts or information or current condition, but instead represent only Halo’s beliefs regarding future events, plans or objectives, many of which, by their nature, are inherently uncertain and outside of Halo’s control. Generally, such forward-looking information or forward-looking statements can be identified by the use of forward-looking terminology such as “plans”, “expects” or “does not expect”, “is expected”, “budget”, “scheduled”, “estimates”, “forecasts”, “intends”, “anticipates” or “does not anticipate”, or “believes”, or variations of such words and phrases or may contain statements that certain actions, events or results “may”, “could”, “would”, “might” or “will be taken”, “will continue”, “will occur” or “will be achieved”. The forward-looking information and forward-looking statements contained herein may include, but is not limited to, statements regarding the terms of the Offering, the expected participation by insiders in the Offering, the expected closing date of the Offering and the Company’s intended use of proceeds raised under the Offering.

By identifying such information and statements in this manner, Halo is alerting the reader that such information and statements are subject to known and unknown risks, uncertainties and other factors that may cause the actual results to be materially different from those expressed or implied by such information and statements. In addition, in connection with the forward-looking information and forward-looking statements contained in this press release, Halo has made certain assumptions. Although Halo believes that the assumptions and factors used in preparing, and the expectations contained in, the forward-looking information and statements are reasonable, undue reliance should not be placed on such information and statements, and no assurance or guarantee can be given that such forward-looking information and statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information and statements. The forward-looking information and forward-looking statements contained in this press release are made as of the date of this press release, and Halo does not undertake to update any forward-looking information and/or forward-looking statements that are contained or referenced herein, except in accordance with applicable securities laws. All subsequent written and oral forward-looking information and statements attributable to Halo or persons acting on its behalf is expressly qualified in its entirety by this notice.


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