EVIO, Inc. Launches EVIO Canada, Signs Binding Agreement to Acquire Cannabis Testing Facility, Keystone Labs Inc.

Print
| Source: EVIO, Inc.

BEND, Ore., April 19, 2018 (GLOBE NEWSWIRE) -- via NetworkWire – EVIO, Inc. (“EVIO” or the “Company”) (OTCQB:EVIO), a leading provider of cannabis testing and scientific research for the regulated cannabis industry, is pleased to announce the establishment of a new and wholly-owned subsidiary, EVIO Canada, which will serve as the parent company for the Company’s Canadian operations. Concurrently, EVIO Canada announced today that it has entered into a binding agreement to acquire 50% of Keystone Labs Inc. (“Keystone Labs”), a privately-held, independent contract-testing laboratory specializing in quality testing for regulated industries located in Edmonton, Alberta.

Founded in 2005 by Jodi McDonald, President of Keystone Labs, the company provides a full array of high quality analytical and microbiological analyses to pharmaceutical, biotechnological, medical device and natural health product industries according to Good Manufacturing Practices (“GMP”).

“We are thrilled to partner with EVIO Labs. This is an incredible opportunity for Keystone Labs to expand our quality testing services into the cannabis market by supporting the production of safe cannabis for Canadians,” said McDonald. “With the leadership and expertise of EVIO’s highly successful management team working with our experienced team, we are confident in our ability to seize the growing opportunities in regulated cannabis testing and innovation and become a market leader in Canada.”

Beginning in 2018, it is expected that adult recreational cannabis will be available to Canada’s population of approximately 36.3 million. With the Canadian cannabis industry projected to reach C$8.7 billion, according to a Deloitte report titled Recreational Marijuana: Insights and Opportunities, in size over the coming years, this strategic acquisition will expand EVIO’s footprint into the market as well as provide the Company with diversification into other testing fields.  

“As the country prepares for adult recreational sales in the coming months, the need for credible and comprehensive cannabis testing is greater than ever. Keystone Labs is one of 37 laboratories licensed by Health Canada and one of only three laboratories that hold both a Dealer’s License and a GMP Drug Establishment License for cannabis testing,” said William Waldrop, CEO and co-founder of EVIO. “This acquisition is a significant milestone for EVIO as it will mark our first foray into an international market. Our goal is to increase consumer safety and confidence, while further pursuing our aggressive expansion plans for 2018.”

Transaction Details:

In consideration for the 50% acquisition of Keystone Labs, EVIO Canada, Inc. will pay a cash purchase price of an aggregate of CDN$2,495,000. This purchase price will be split as to CDN$2,035,000 to the shareholders of Keystone Labs to purchase 45% of the issued and outstanding shares of the company and as to CDN$460,000 to Keystone Labs to purchase shares of Keystone Labs equal to an additional 5% of the issued and outstanding shares directly from treasury. EVIO will provide a line of credit to Keystone Labs up to a maximum principal amount of CDN$1,000,000 to support operations. In connection with and immediately following the completion of the foregoing transactions, the shareholders of Keystone Labs shall subscribe for an aggregate of 1,291,391 of common shares in the capital of EVIO for an aggregate purchase price of CDN$1.95M on a private placement basis. The proposed transaction is subject to customary closing conditions, including both parties completing due diligence and obtaining any approvals from applicable local authorities. Contingent upon completion of final agreements and documents, the transaction is expected to close on or about May 1, 2018.

About EVIO, Inc.

EVIO, Inc. is a leading provider of cannabis testing and scientific research for the regulated cannabis industry. The Company’s EVIO Labs division operates coast-to-coast providing state-mandated ancillary services to ensure the safety and quality of the nation's cannabis supply.  EVIO is on track to have 18 of its state-of-the-art testing facilities by year-end 2018.

For more information, visit www.eviolabs.com.

About Keystone Labs

Keystone Labs Inc., located in Edmonton, Alberta, is a privately held Heath Canada accredited testing facility with a GMP establishment license. Keystone offers a full array of analytical and microbiological testing services for pharmaceutical, biotechnology, medical device, nutraceutical, medical cannabis and related industries.

For more information, visit https://keystonelabs.ca/.

Safe Harbor Statement

Any statements in this press release that are not statements of historical fact maybe considered to be forward-looking statements. Statements may contain certain forward-looking statements pertaining to future anticipated or projected plans, performance and developments, as well as other statements relating to future operations and results and include, but are not limited to, the anticipated legalization of recreational cannabis in Canada, the anticipated size of the Canadian adult recreational cannabis market, the completion of the proposed acquisition of Keystone Labs and the anticipated timing thereof, Keystone Labs’ ability to develop into a Canadian market leader, the subscription for EVIO shares by the Keystone Labs shareholders, the receipt of necessary approvals in connection with the transactions described herein, and EVIO’s expansion of testing facilities in calendar 2018. Words such as "may," "will," "expect," "believe," "anticipate," "estimate," "intends," "goal," "objective," "seek," "attempt," or variations of these or similar words, identify forward-looking statements. These forward-looking statements by their nature are estimates of future results only and involve substantial risks and uncertainties, including but not limited to risks associated with the uncertainty of future financial results, additional financing requirements, development of new products, EVIO’s ability to complete our product testing and launch our product commercially, the acceptance of EVIO’s product in the marketplace, the uncertainty of the laws and regulations relating to cannabis, the impact of competitive products or pricing, technological changes, the effect of economic conditions and other uncertainties detailed from time to time in EVIO’s reports filed with the Securities and Exchange Commission, available at www.sec.gov or www.eviolabs.com.

CONTACT INFORMATION

Company Contact:
Cheryl Kramp
Director of Marketing
EVIO, Inc.
Bend, OR
www.EVIOlabs.com
888-544-EVIO
info@EVIOlabs.com

Media Contact:
Carrie Booze
North 6th Agency
212-334-9753 ext.142
evio@n6a.com

Corporate Communications Contact:
NetworkNewsWire (NNW)
New York, New York
www.NetworkNewsWire.com
212.418.1217 Office
Editor@NetworkNewsWire.com