Halo Collective Signs Definitive Agreement with Nature’s Best Resources LLC

Not for Distribution to U.S. Newswire Servicers or For Dissemination in the United States
All figures in USD unless stated otherwise

Toronto, March 26, 2021 – Halo Collective Inc. (“Halo” or the “Company“) (NEO: HALO) (OTCQX: HCANF) (Germany: A9KN) has announced the signing of a definitive agreement with Nature’s Best Resources LLC (“Nature’s Best“). This agreement will support the Company’s strategic focus of being the leading, vertically integrated cannabis company that cultivates, extracts, manufactures and distributes high-quality products in the cannabis marketplace.

Nature’s Best’s is a rosin technology and manufacturing company – a solventless cannabis concentrate that has gained significant popularity in Oregon and California over the last few years. Nature’s Best also produces variants of rosin such as ice water hash, taffy, and caviar. Rosin’s honey-like texture is unlike other concentrates due to its extraction processes, allowing the product to possess the same effects and flavor as traditional flower. As trends in the cannabis industry continue to evolve, live rosin has been reported to be one of the fastest-growing sub-sectors of concentrates on the market.1 Nature’s Best also produces premium hash byproducts that can be packaged as hash or sold to infuse edibles, beverages, and pre-rolls. 

According to BDS Analytics (BDSA) data, total rosin concentrate sales in California reached $12.47M in 2019, while sales in Oregon reached $7.36M in the same year. In 2020 the market caught fire and rose to $24.81M in California and $17.78M in Oregon, making rosin one of the fastest-growing product segments in cannabis. Between 2019 and 2020, year-over-year growth in California reached 99 percent, while Oregon reached a notable 150 percent. In 2021, rosin sales appear to be growing even faster in California.  Between January 2020 and January 2021, data reports show rosin sales were up 127% in California. In the same period, Oregon sales continued to grow by 66% in January 2021 from January 2020.2 Extrapolating these growth rates3 implies that the 2021 rosin market is anticipated to be $62.5M (up from approximately $25M in 2020) in California and $30.6M in Oregon (up from approximately $18M in 2020).  At current average retail prices, approximately 86,000 grams and 50,000 grams are anticipated to be sold in California and Oregon, respectively, per month in 2021.4 After acquiring Nature’s Best, management expects Halo’s daily rosin production capacity to be 3,000 grams and running shifts five days per week. The Company anticipates it can satisfy 70% of California’s demand and all of Oregon’s in 2021 at current market sales rates. 

The agreement states that the Company will acquire 100 percent of Nature’s Best Resources LLC membership interests in exchange for the issuance of up to 44,047,619 common shares in the capital of the Company (“Common Shares“).

The closing of the agreement is subject to certain closing conditions, including the contribution by the selling member to Nature’s Best of $250,000 and standard operating procedures detailing the manufacturing of rosin products by Nature’s Best. A total of 8,928,571 Common Shares will be issued to Nature’s Best, and 35,119,048 Common Shares will be placed into escrow to be released to the selling member upon the satisfaction of certain predetermined milestones by Nature’s Best.

“The purity and concentration of our rosin products are unparalleled in the marketplace,” said the Chief Strategy Officer of Nature’s Best. “Our mission is to provide premium live rosin to our clients with purity at top of mind. Partnering together with Halo Collective — a powerhouse in the industry — we will be able to further promote our products to individuals so they can experience the most balanced and beneficial way to consume cannabis.” 

Transaction detail

A total of 8,928,570 Common Shares will be released on or before June 1, 2021, provided the selling member has repaid an outstanding $250,000 owed to Nature’s Best. A total of 14,285,715 additional Common Shares will be released on or before October 1, 2021, provided that specific equipment has been delivered to Nature’s Best. The remaining 11,904,762 Common Shares will be released on or before March 1, 2022, provided that Nature’s Best has produced and sold a batch of hash or hash rosin in each of Oregon and California, measuring 100 grams total.

If any milestone is not satisfied by the date specified for its completion, the corresponding number of Common Shares will be returned to the Company. The Common Shares are subject to volume transfer restrictions that prohibit the sale of any number of Common Shares through any stock exchange that would exceed ten percent of the prior trading day’s total volume of the Common Shares.

About Nature’s Best

Natures Best is a premier consumer-driven cannabinoid company specializing in product development, production, distribution and retail placement of cannabinoid rosin products.  Our development team includes a pharmacologist and process engineer with 30 years of experience, a product distribution and retail placement executive with 20 years of experience, as well as an experienced team in cannabinoid operations in Oregon and California.

About Halo Collective

Halo is a leading, vertically integrated cannabis company that cultivates, extracts, manufactures, and distributes quality cannabis flower, oils, and concentrates and has sold approximately nine million grams of oils and concentrates since inception. Halo continues to evolve its business and scale efficiently, partnering with trustworthy leaders in the industry, who value the Company’s operational expertise in bringing top-tier products to market. Current growth includes expansion in key U.S. markets, the United Kingdom and Africa, with planned expansion into the Canadian retail market.

Halo is led by a strong, diverse, and innovative management team with deep industry knowledge and blue-chip experience. The Company is currently operating in the United States in California and Oregon. The Company sells cannabis products principally to dispensaries under its brands, Hush, Mojave, and Exhale, and under partnership or license with OG DNA Genetics, Terphogz (doing business as Zkittlez™) and FlowerShop*, a cannabis lifestyle and conceptual wellness brand in which G-Eazy is a partner and key member of Flowershop*.

As part of continued expansion and vertical integration in the U.S., Halo boasts several grow operations throughout Oregon and California. In Oregon, the Company has a combined 7 acres of outdoor cultivation, including East Evans Creek, a six-acre grow site in Jackson County, and Winberry Farms, a one-acre grow site located 30 miles outside Eugene in Lane County. In California, the Company is building out Ukiah Ventures; a planned 30,000-square-foot indoor grow, processing, and manufacturing facility including up to an additional five acres of industrial land to expand. Recently, Halo partnered with Green Matter Holding to purchase Bar X Ranch in Lake County, developing up to 80 acres of cultivation which would comprise the largest grow in Northern California.

Internationally, the Company’s subsidiary Bophelo Bioscience & Wellness (Pty) Lt.d (“Bophelo”) is currently cultivating cannabis in Lesotho, which holds one of the most extensive marijuana cultivation licenses in Africa with a future capacity of up to 495 acres. To further Halo’s global presence, the Company has recently acquired CBPM importation and distribution licensing in the United Kingdom via cannabis suppliers Canmart Ltd (“Canmart”). Halo expects the cultivation and manufacturing operations of Bophelo, combined with the importation and distribution capabilities of Canmart, to drive a well-positioned business to serve the U.K. market.

The Company also has acquired a range of software development assets, including technology platforms CannPOS, Cannalift, and, more recently, CannaFeels. Halo also owns the discrete sublingual dosing technology, Accudab.

Connect with Halo Collective:
 Email | Website |LinkedIn | Twitter | Instagram

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1 https://www.greenentrepreneur.com/article/355904
2 Statistics referenced have been cited from 2019-2021 BDSA data reporting, the leading provider of market research solutions for the global cannabinoid industry from forecastts to trends, from the USA to Europe.
3 Assuming rosin sales in California hit 150% growth rate and Oregon 70% grow rate in 2021.
4 $60.54 in California per gram and $52.27 in Oregon per gram.

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”. Forward-looking information may relate to anticipated events or results including, but not limited to the development and prospects of Bophelo’s operations and the granting of certifications, Halo’s planned expansion into the Canadian retail market, the expected size and capabilities of the final facility planned at Ukiah Ventures, the size of Halo’s planned cultivation facility in Northern California and the ability of Bophelo and Canmart to serve the E.U., U.K. and Australian market.

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. Among others, the key factors that could cause actual results to differ materially from those projected in the forward-looking information and statements are the following: unforeseen delays or circumstances that prevent the applicable stock exchanges from commencing trading in the Company’s shares or warrants; delays in obtaining required licenses or approvals, delays or unforeseen costs incurred in connection with construction, the ability of competitors to scale operations in Northern California, delays or unforeseen difficulties in connection with the cultivation and harvest of Halo’s raw material, changes in general economic, business and political conditions, including changes in the financial markets; and the other risks disclosed in the Company’s annual information form dated April 16, 2020 and available on the Company’s profile at www.sedar.com. Should one or more of these risks, uncertainties or other factors materialize, or should assumptions underlying the forward-looking information or statements prove incorrect, actual results may vary materially from those described herein as intended, planned, anticipated, believed, estimated or expected.

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.

Third Party Information

This press release includes market and industry data that has been obtained from third party sources, including industry publications. The Company believes that the industry data is accurate and that its estimates and assumptions are reasonable, but there is no assurance as to the accuracy or completeness of this data. Third party sources generally state that the information contained therein has been obtained from sources believed to be reliable, but there is no assurance as to the accuracy or completeness of included information. Although the data is believed to be reliable, the Company has not independently verified any of the data from third party sources referred to in this press release or ascertained the underlying economic assumptions relied upon by such sources.

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