Mota Ventures Corp. (CSE:MOTA)(FSE:1WZ:GR)(OTCPINK:PEMTF) (the “Company” or “Mota“)
is pleased to announce that further to its January 10, 2020 news
release, it has now acquired the intellectual property and trade names
of Sativida from Sativida OU (Estonia). The Company will license both
back to Sativida OU’s subsidiary, VIDA BCN LABS S.L. (collectively with
Sativida OU, “Sativida“) in exchange for a royalty associated with the gross revenues generated by Sativida.
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.
Through Mota, Sativida has an agreement with Unified Funding, LLC (“Unified“)
for the expansion of the brand into the United States. Unified will
provide assistance to Sativida with product sourcing, packaging,
shipping, payment infrastructure and marketing in the United States.
Unified Funding is an e-Commerce and technology company focused on
serving U.S.-based and international consumers in the CBD and natural
health products market. Powered by its proprietary technology platform,
Unified has created an e-Commerce ecosystem to scale its brands through
data analysis, strategic customer acquisition and supply chain
management. Since June 2015, Unified has generated a database of over
4.5 million consumers and has facilitated over US$200 million in
consumer transactions from more than one million paying customers.
“I
am very excited to announce the acquisition of the Sativida brand. This
gives Mota immediate entry into the European market and will be a
building block for our planned European expansion. Mota’s U.S.
operation, First Class CBD, is set to enter the European market and we
expect the acquisition of the Sativida brand to expedite this expansion.
Furthermore, our partnership with Unified Funding, LLC, the e-Commerce
platform behind the success of First Class CBD, will allow us to bring
the Sativida brand to the U.S. market as well,” stated Ryan Hoggan, CEO
of the Company.
Noah
Laith, founder of Sativida, commented, “Joining Mota is a major step
for Sativida that will provide access to the capital, connections and
infrastructure necessary to grow our business in Europe and
internationally.”
Pursuant to the previously announced binding agreement with Sativida dated January 9, 2020 (the “Transaction Agreement“), the Company was granted the right to acquire Sativida in stages (the “Transaction“),
at the discretion of the Company, as certain corporate and intellectual
property registrations were completed. To accomplish this, the Company
set up a wholly-owned Spanish subsidiary (“Spanish Subco“)
and coordinated the registration of various intellectual property and
trade names associated with business operations of Sativida.
The
Company, through Spanish Subco, has now completed the acquisition of
the intellectual property and trade names of Sativida in Spain, and will
license both back to Sativida in exchange for a royalty associated with
the gross revenues generated by Sativida. Pursuant to the Transaction
Agreement, the Company also holds the right to acquire, through Spanish
Subco, all of the outstanding share capital of Sativida at any time for
no additional consideration.
Consideration for the Transaction is made up of an initial component of €2,000,001 (the “Consideration“) and an earn-out component made up of three milestone payments based upon the revenue of Sativida (each, a “Milestone Payment“). The Consideration was paid in 5,496,221 common shares of the Company (the “Consideration Shares“)
at a deemed price of $0.5689 per share. Each Milestone Payment will be
based on a 400% multiple of Sativida’s revenue 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 has paid a 10% finder’s fee based on the
total value of the Consideration Shares (528,072 common shares) to
certain finders that assisted in introducing the Transaction to the
parties as well as a 2% administrative success fee based on the total
value of the Consideration Shares (105,614 common shares) to a
consultant who assisted in the administration of the transaction.
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
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 is looking to establish
sales channels and a distribution network internationally through the
acquisition of the Sativida and First Class CBD brands. Low cost
production, coupled with international, direct to customer sales
channels will provide the foundation for the success of Mota.
About Sativida
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 at www.sativida.es.
ON BEHALF OF THE BOARD OF DIRECTORS
MOTA VENTURES CORP.
Ryan Hoggan
Chief Executive Officer
For
further information, readers are encouraged to contact the President of
the Company, Joel Shacker, at +604.423.4733 or by email at [email protected] or www.motaventuresco.com
