Nutritional High Congratulates Lineage Growth Company and Harborside on Signing Definitive Agreement; Amends Letter Agreement With Lineage
TORONTO, April 10, 2019 (GLOBE NEWSWIRE) — Nutritional High International Inc. (the “Company” or “Nutritional High”) (CSE: EAT, OTCQB: SPLIF, FRANKFURT: 2NU) would like to congratulate Lineage Growth Company Ltd. (“Lineage”) on the signing of a definitive merger agreement of a reverse takeover transaction (the “Transaction”) between Lineage and FLRish, Inc., a California corporation d/b/a Harborside (“Harborside”) (see Lineage and Harborside’s press release on Feb 11, 2019).
Harborside currently carries Nutritional High’s flagship FLÏ™ products and the Company’s wholly owned distributor, Calyx Brands, Inc. (“Calyx”) supplies various other cannabis products to Harborside. Nutritional High also supplies its flagship FLÏ™-branded products to Lineage’s Terpene Station dispensaries in both Eugene and Portland, Oregon.
Nutritional High would also like to report that it has signed a letter agreement with Lineage (the “Letter Agreement”) amending part of an amended and restated letter agreement (the “Lineage Agreement”) dated February 1, 2018, in order to facilitate and support the Transaction. Pursuant to the terms of the Lineage Agreement (see the Company’s press release on February 7, 2018), in exchange for certain financial covenants and financial support of Nutritional High, Lineage (among other consideration) issued to Nutritional High 1,250,000 common shares of Lineage, and was to reserve at least 20% of the dispensary’s shelf space for Nutritional High’s products, subject to availability of supply. Nutritional High’s financial obligations have since been extinguished. Nutritional High strongly supports the Lineage-Harborside Transaction and enjoys commercial relationships with both companies. As such, and conditional on the closing of the Transaction, Nutritional High has agreed to release Lineage of its shelf space obligation. The Company has also agreed to convert a $75,000 debt obligation it had from Lineage, into 454,545 additional common shares of Lineage at a deemed price of $0.165 per common share (the “Debt Settlement”). Completion of the Debt Settlement is subject to the approval of the Canadian Securities Exchange and the common shares will be subject to a four-month hold period in accordance with applicable securities laws.
The Letter Agreement regarding the release of its shelf space obligation was approved by the independent board members of Nutritional High with Adam Szweras and David Posner recusing themselves given their involvement with Lineage.
Jim Frazier, CEO of Nutritional High, commented, “This Letter Agreement is an important step in the development of a long-term sustainable relationship with Harborside and Lineage, which we have already cemented at the operational level via our FLÏ™ products and Calyx distribution.” Jim continued, “We want to grow our sales to Harborside and Lineage based on the quality and growing consumer demand for our products, as opposed to merely being a beneficiary of a contractual obligation. We look forward to deepening our relationship and working together in the States of California and Oregon.”
Peter Bilodeau, CEO of Lineage, added, “Lineage appreciates Nutritional High’s ongoing support for the Transaction, and we are pleased to announce the definitive merger agreement between Harborside and Lineage is moving towards completion. We look forward to new business opportunities and potential collaborations moving forward.”
Andrew Berman, CEO of Harborside, commented, “Harborside enjoys working with Calyx and is pleased to carry FLÏ™ products in Harborside. We have been receiving positive feedback about the FLÏ™-branded product lines from our consumers. Harborside strongly appreciates the support and relationship that we have with Nutritional High and looks forward to the mutually beneficial growth of both businesses.”