Lifeist To Acquire Zest Cannabis

Lifeist Wellness Inc. LFSWF LFST M has entered into a definitive share purchase agreement, pursuant to which the company will acquire 100% of 1000501971 Ontario Inc. (“Zest”) for $3.4 million. The acquisition is an all-stock transaction, marking another significant milestone for Lifeist’s expansion strategy.

“The acquisition of Zest is another crucial step in our journey to establish Lifeist as one of Canada’s leading health-tech companies, with a goal to revolutionize human wellness,” stated Meni Morim, CEO of Lifeist. “With Zest we acquire an established brand with sales in multiple provinces and territories, along with the added benefit of their unique Liquid Diamond vape formulations. The sale of vapes will generate additional revenue streams for Lifeist through prospective royalty and licensing agreements. We look forward to the seamless integration of Zest and its product portfolio into the Lifeist group of companies.”

Transaction Details

The acquisition, which is an arm’s length transaction, is subject to, among other things, receipt of required TSX Venture Exchange approval, and other customary conditions of closing, and is expected to close in the coming weeks. Pursuant to the terms of the share purchase agreement, Lifeist will purchase 100% of the issued and outstanding shares of Zest from 13735346 Canada Inc. and 1000496959 Ontario Ltd. The consideration for the acquisition is comprised of, and is payable upon the following terms: $1.5 million in common shares of the company on the basis of a deemed price of $0.05 per common share (the “initial consideration shares”) and $1.9 million in common shares on the basis of a deemed price of $0.05 per common share (the “escrowed shares” and together with the initial consideration shares, the “consideration shares”). Pursuant to the terms of the share purchase agreement, the escrowed shares shall be deposited into escrow and released over a period of nine months in accordance with certain milestones pursuant to the terms and conditions of the escrow agreement.

As a condition of the acquisition, each seller will enter into a support and voting agreement with respect to the consideration shares received by the sellers in connection with the acquisition. Pursuant to the voting agreement, the company will provide written notice to each seller on how the considerations shares must be voted. The voting agreement will automatically terminate two years after the date of the closing of the acquisition.

Corporate Update

The company also announced the grant of restricted share units to members of the senior management team as part of a salary deferral program implemented in 2022. The board of directors have approved a grant of 281,843 RSUs to senior management of the company. The RSUs will vest one year from the grant date and have a two-year term. The grants of RSUs are subject to TSXV approval.

Photo: Benzinga edit with photos by jarmoluk and lindsayfox on Pixabay

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