VANCOUVER, BC and MESA, AZ, Feb. 20, 2014 /PRNewswire/ - Avidus Management Group Inc. (TSX-V: AVD; "Avidus" or the "Company") is pleased to announce that it has entered into an asset purchase agreement (the "Agreement") with Akea, LLC ("Akea") (www.akealife.com), pursuant to which the Company has acquired the business assets of Akea, a network marketing company based in Raleigh, North Carolina. Completion of the transaction is subject to the final approval of the TSX Venture Exchange ("TSXV").
Avidus' CEO, Doug Ridley, commented, "In the 3rd quarter of 2013, we announced that Avidus would implement a growth strategy that included acquisitions of direct sales/network marketing companies. As our first such acquisition, Akea brings a distributor and customer base with substantial present value, as well as tremendous growth potential and a complementary product of exceptional quality. We will be introducing Asantae products to the Akea network and Akea products to the Asantae network in the near-term. Akea joining the Avidus family is the first of several growth initiatives anticipated in 2014."
Akea's CEO, Munther Qubain, said, "Over the past 4 years, we have built a solid product foundation and have gathered loyal customers and distributors who have built successful businesses. By joining forces with Avidus/Asantae, our field organization will benefit from their corporate and field leadership teams as well as their F.A.S.T. Track Business Building System. We strongly believe this partnership will help accelerate growth and enable us to better reach the masses with our exceptional product."
Akea's primary product is a whole food, fermented supplement sold through a growing network of 1,600 active distributors who generated revenue of over US$2.2 million in 2013. Pursuant to the terms of the Agreement, the purchased assets, which include, among other things, customer data, intellectual property and software, will be acquired for an aggregate purchase price of US$2,000,000, plus $279,414.74 for the physical assets, including inventory (the "Acquisition"). The purchase price will be paid in four parts as follows: $100,000 at the effective date of the Acquisition (which has been advanced to Akea); post-closing payments of $400,000 four weeks from the effective date of the Acquisition; $1,500,000 paid through royalties based on a percentage of monthly revenues, and two equal payments for the physical assets to occur on August 1, 2014 and February 1, 2015. Pursuant to the Agreement, closing of the Acquisition has been completed, subject to the approval of the TSXV.
In connection with the Acquisition, the Company also announces a non-brokered private placement of 8,000,000 units (each a "Unit") at a price of $0.10 per Unit for gross proceeds of $800,000. Each Unit will be comprised of one common share and one transferable common share purchase warrant (each a "Warrant") of the Company and each Warrant will entitle the holder thereof to purchase an additional common share of the Company at an exercise price of $0.20 per share for 36 months from the closing of the private placement.
The securities issued in connection with the private placement and any shares issued in connection with the exercise of Warrants will be subject to a statutory hold period of four months plus a day from the date of issuance of the Units in accordance with applicable securities legislation. Closing of the private placement is subject to a number of conditions, including receipt of all necessary corporate and regulatory approvals, including the TSXV.
It is intended that the net proceeds of the private placement will be used primarily to fund the post-closing payments and costs associated with the Acquisition.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Avidus Management Group Inc. (TSXV: AVD, OTC: ASNHF), based in Mesa, Arizona, develops, acquires and operates growth direct sales and network marketing companies in the consumer health and wellness market. Avidus brands include Asantae (www.asantae.com and Akea www.akealife.com). The Avidus leadership team has a combined experience of 100 years in network marketing and direct selling. For more information, visit www.avidusmanagementgroup.com.
Forward Looking Statements
Certain information in this news release is forward-looking within the meaning of certain securities laws, and is subject to important risks, uncertainties and assumptions. This forward-looking information includes, among other things, information with respect to the Company's beliefs, plans, expectations, anticipations, estimates and intentions, including the completion of the Acquisition and the private placement of Units. The words "may", "could", "should", "would", "suspect", "outlook", "believe", "anticipate", "estimate", "expect", "intend", "plan", "target" and similar words and expressions are used to identify forward-looking information. The forward-looking information in this news release describes the Company's expectations as of the date of this news release.
The results or events anticipated or predicted in such forward-looking information may differ materially from actual results or events. Material factors which could cause actual results or events to differ materially from such forward- looking information include, among others, the Company's ability to develop new products which will receive market acceptance, to receive market acceptance in new markets outside the United States, to engage and retain qualified key personnel, employees and affiliates, to obtain capital and credit and to protect its intellectual property rights.
The Company cautions that the foregoing list of material factors is not exhaustive. When relying on the Company's forward-looking information to make decisions, investors and others should carefully consider the foregoing factors and other uncertainties and potential events. The Company has assumed a certain progression, which may not be realized. It has also assumed that the material factors referred to in the previous paragraph will not cause such forward-looking information to differ materially from actual results or events. However, the list of these factors is not exhaustive and is subject to change and there can be no assurance that such assumptions will reflect the actual outcome of such items or factors.
THE FORWARD-LOOKING INFORMATION CONTAINED IN THIS NEWS RELEASE REPRESENTS THE EXPECTATIONS OF THE COMPANY AS OF THE DATE OF THIS NEWS RELEASE AND, ACCORDINGLY, IS SUBJECT TO CHANGE AFTER SUCH DATE. READERS SHOULD NOT PLACE UNDUE IMPORTANCE ON FORWARD-LOOKING INFORMATION AND SHOULD NOT RELY UPON THIS INFORMATION AS OF ANY OTHER DATE. WHILE THE COMPANY MAY ELECT TO, IT DOES NOT UNDERTAKE TO UPDATE THIS INFORMATION AT ANY PARTICULAR TIME.SOURCE Avidus Management Group Inc.