CALGARY, Dec. 3, 2018 /CNW/ - Pond Technologies Holdings Inc. (Pond) TSX.V: POND, is pleased to announce that on November 30, 2018 Pond acquired the exclusive Canadian distribution and sales rights for certain products of RFI, LLC (RFI), a U.S. based food ingredient and health nutrition blend supplier. RFI is a leading North American purchaser and re-seller of Spirulina and Chlorella, providing Pond with a vertical integration channel for its algae and related products. The rights were previously held by RFI Canada Partnership, an Ontario partnership comprised of RFI, and 2197992 Ontario Inc.
- In the year ended December 31, 2017, the RFI Canada partnership recorded sales revenues exceeding $2.3 million against expenses of $1.9 Million.
- RFI and Pond agree to negotiate distribution agreements within the next 12 months under which RFI agrees to buy from Pond a minimum of 100 metric tonnes of nutraceutical Spirulina algae annually, and to receive US distribution rights for Pond bulk ingredients including retail distribution of Pond's Astaxanthin brand.
- Pond receives the exclusive distribution rights for an initial term of 5 years with an exclusive right to renew for a further 5 years provided certain sales targets are met.
- Pond Naturals will resell certain RFI products and promote algae derived products into growing high value markets, including nutraceuticals, food colourants, cosmetics, and animal and aquaculture feeds.
- Grant Smith, President, RFI Canada Partnership and 2197992 Ontario Inc., and Pond strategic advisor, will join Pond Technologies full-time as Vice President of the Pond Naturals division. Mr. Smith is a 25-year veteran of the North American nutraceutical industry.
Partial consideration for the purchase by Pond of the exclusive distribution rights to the RFI products is comprised of $160,000 in Pond shares issued from treasury based on the value of the shares at closing on November 29, 2018 (Pond Shares) to RFI and $160,000 in Pond Shares to 2197992 Ontario Inc. In addition to the hold periods required for the Pond Shares under securities legislation and by the TSX Venture Exchange (expiring on April 1, 2019), the Pond Shares issued to 2197992 Ontario Inc. are subject to an additional contractual hold period, with 50% released 12 months after closing and 50% released 24 months after closing provided that the acquired distribution rights generate certain minimum revenues to Pond in each year of release.
As President of RFI Canada Partnership and 2197992 Ontario Inc., Mr. Smith has served as a valued ingredient and formulation advisor to North America's leading nutraceutical, food and beverage companies. Mr. Smith will be responsible for the management and growth of the Pond Naturals Division.
Steve Martin, Pond CEO, commented "Pond is pleased to add RFI to a growing number of key strategic and commercial relationships. The acquisition of their Canadian distribution rights will firmly establish Pond as a vertically integrated supplier of quality nutraceutical products. In addition, access to RFI's extensive US distribution network will help us expand the market for Pond's algae and Astaxanthin branded products. We are also very excited to welcome Grant Smith as a permanent member of Pond's management team. As an advisor, Grant has brought a wealth of industry knowledge and experience to the decision-making process at Pond. We look forward to Grant's continued contribution to Pond's growth and profitability in the important role of Vice President, Pond Naturals."
Grant Smith commented "I am excited to join Pond's leadership team. I have over 20 years of industry experience, developing new sales channels and growing market share and I am here to lead the sales efforts to get Pond's high-value algae products onto the world stage. We have laid the ground-work for the Pond Naturals brand, and with my experience, and the product offerings, we are poised to deliver reliable recurring revenues, beginning right now."
According to Jeffrey Wuagneux, founder and CEO of RFI, "I am pleased to be partnering with Pond Technologies . The acquisition of our Canadian distribution company will allow us to continue to grow our business and create exciting new product development and sales opportunities globally by maximizing both companies' technology and platforms."
The issuance of Pond Shares remains subject to final approval of the TSX Venture Exchange.
This press release contains forward-looking statements within the meaning of applicable securities laws, including statements regarding Pond's vertical integration for its products, the entering into of distribution agreements for Pond's spirulina and astaxanthin products within 12 months and Pond's ability to expand the market for its algae and astaxanthin products. Such forward-looking statements are based on certain key expectations and assumptions made by Pond, including expectations and assumptions concerning the completion of certain M&A activity, receipt of final approval from the TSX Venture Exchange.
Although Pond believes that the expectations and assumptions on which such forward-looking statements are based are reasonable, undue reliance should not be placed thereon and Pond can give no assurance that they will prove to be correct. By its nature, such forward-looking statements are subject to various risks and uncertainties, which could cause the actual results and expectations to differ materially from the anticipated results or expectations expressed, including the ability of Pond to reach anticipated sales targets of RFI products in Canada and the potential failure of the parties to enter into the distribution agreements for Pond products. Readers are cautioned not to place undue reliance on this forward-looking information, which is given as of the date hereof, and to not use such forward-looking information for anything other than its intended purpose. Pond does not undertake any obligation to update publicly or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as required by law.
About Pond Technologies:
Located in Markham, Ontario, Pond is a technology company that provides profitable solutions to the global health and wellness challenges of pollution abatement and nutrition. Pond's proprietary growth platform optimizes key growth inputs in order to provide a controlled environment that maximizes the growth of algae and other organisms. It enables industrial emitters to generate new revenue streams from the transformation of waste CO2 to valuable algae-based products used as proteins for animal feed and nutraceutical products like Chlorella, Spirulina, and Astaxanthin for human consumption.
Neither the TSXV nor its Regulation Services Provider (as that term is defined in the policies of the TSXV) accepts responsibility for the adequacy or accuracy of this release. No stock exchange, securities commission or other regulatory authority has approved or disapproved of the information contained herein.
SOURCE Pond Technologies Holdings Inc.