High Tide completes Daily High Club acquisition
2021-07-20 07:25 ET - News Release
An anonymous director reports
HIGH TIDE CLOSES ACQUISITION OF DAILY HIGH CLUB
High Tide Inc. has completed the acquisition of DHC Supply LLC, operating as Daily High Club.
The acquisition was completed pursuant to the terms of the merger agreement previously announced by the company on June 25, 2021, pursuant to which High Tide USA Inc., a Nevada corporation and a wholly owned U.S. subsidiary of the company (Subco), has acquired 100 per cent of the issued and outstanding shares of Daily High Club.
Pursuant to the terms of the acquisition, the total consideration to Daily High Club shareholders for all the issued and outstanding securities of Daily High Club is: (i) 839,820 common shares of High Tide valued at $6.75-million (U.S.) on the basis of a deemed price per High Tide share of $9.92 (Canadian), being equal to the volume-weighted average price per High Tide share on the TSX Venture Exchange for the 10 consecutive trading days preceding the closing of the transaction; and (ii) $3.25-million (U.S.) in cash.
In connection with the closing, Harrison Baum, chief executive officer of Daily High Club, has joined the High Tide team as director of digital marketing to oversee all social media initiatives for High Tide globally.
The High Tide shares issued pursuant to the share consideration are subject to a statutory hold period of four months and one day. In addition, the High Tide shares having a value of 25 per cent of the consideration will be held in escrow to ensure certain indemnification obligations if claims arise.
Furthermore, High Tide granted 13,333 stock options to Mr. Baum, exercisable at $9.39 (Canadian) per High Tide share for a period of three years.
About DHC Supply LLC
With over one million consumption accessories sold and over 15,000 subscribers, Daily High Club is one of the leading on-line retailers of glass water pipes, vaporizers and other in-demand consumption accessories. Daily High Club provides a marketplace with a wide variety of high-quality products and subscription boxes. Daily High Club has an active social media presence with numerous influencer and celebrity endorsements, including deals with Tommy Chong, Chanel West Coast and more. Daily High Club boasts over 800,000 followers on Instagram and 75,000 followers on TikTok. The company's website offers an engaging and fun shopping experience.
About High Tide Inc.
High Tide is a retail-focused cannabis company enhanced by the manufacturing and distribution of consumption accessories. The company is the most profitable Canadian retailer of recreational cannabis as measured by adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) with 89 current locations spanning Ontario, Alberta, Manitoba and Saskatchewan. High Tide's retail segment features the Canna Cabana, KushBar, Meta Cannabis Co., Meta Cannabis Supply Co. and NewLeaf Cannabis banners, with additional locations under development across the country. High Tide has been serving consumers for over a decade through its established e-commerce platforms, including Grasscity, Smokecartel and Dailyhighclub, and more recently in the hemp-derived CBD (cannabidiol) space through CBDcity and FabCBD as well as its wholesale distribution division under Valiant Distribution, including the licensed entertainment product manufacturer Famous Brandz. High Tide's strategy as a parent company is to extend and strengthen its integrated value chain, while providing a complete customer experience and maximizing shareholder value. Key industry investors in High Tide include Tilray Inc. and Aurora Cannabis Inc.
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