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Leading Psychedelic Wellness Company Delic Signs Definitive Agreement to Acquire Ketamine Infusion Centers Llc, Bringing Physical Retail Chain to Delic Portfolio

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Acquisition to Expand Self-Sustaining Ecosystem with Existing Education Platform and Product Development Lab

VANCOUVER, BC, June 8, 2021 /CNW/ - Delic Holdings Inc. ("DELIC" or the "Company") (CSE: DELC) (OTCQB: DELCF), the leading psychedelic wellness platform has signed a definitive agreement (the "Agreement") to acquire Ketamine Infusion Centers LLC ("KIC"). KIC is a limited liability corporation formed under the laws of Arizona, which owns and operates two ketamine infusion treatment clinics, one in Phoenix, Arizona and the other in Bakersfield, California (the "Transaction"). Supported by clinical trials and peer reviewed studies, ketamine infusions have emerged as a promising treatment option for chronic diseases and pain disorders. The successful completion of the transaction will bring a physical retail footprint to the DELIC ecosystem where it can leverage its IP, product development and audience capture through its various leading media properties.

Delic Holdings Inc. Logo (CNW Group/Delic Holdings Inc.)
Delic Holdings Inc. Logo (CNW Group/Delic Holdings Inc.)

Transaction Highlights

  • The Transaction establishes DELIC as a diversified psychedelics organization. KIC has been growing steadily with revenues in ‎excess of USD$1.5 million since 2019

  • KIC will be one of the largest ketamine clinics, pending recently announced expansion. KIC will double its footprint to four (4) physical locations in California and Arizona

  • KIC will be strategically positioned to leverage DELIC platform and brand: DELIC expects to drive patients to KIC through its media platform and become a national leader

  • Established history of providing ketamine infusion services. The management team at KIC has been in ‎business for 3 years expanding services throughout the United States

  • Management expertise. The acquisition of KIC will add a team of 6 medical professionals and ‎employees bringing a wealth of industry ‎experience and knowledge to DELIC

Matt Stang, Founder and CEO of DELIC commented, "We publicly listed DELIC with the intent of buying cash-flowing, scalable companies and that is exactly what KIC represents. We are focused on making psychedelic wellness truly accessible, and this is a huge development in the realization of that vision."

Sonny Diaz, Co-Founder of KIC stated, "We were thrilled to be joining the DELIC platform as we feel their patient acquisition strategy - using DELIC's media platform to drive patients - is a game changer for scaling our clinics and expanding patient access. With a history of profitability and a management team with decades of experience in the health sector and successful exits of over two dozen clinics and hospitals, KIC's extensive background in operating clinics and hospitals will enable DELIC to be the leader in legal psychedelic treatment clinics.

By acquiring KIC, DELIC expands from its hub of psychedelic education, media, and information properties and licensed lab and IP company (CBDV) to the ability to provide patients with psychedelic therapy. DELIC is uniquely positioned to bring digital awareness to its various holdings under the DELIC umbrella, and drive online users to brick and mortar clinics.

Over the last 3 years, the team at KIC has expanded from Arizona to California, while overseeing 4,000 treatments delivered to date, and generating over USD$1.5MM in revenue. KIC will operate under the DELIC umbrella, under the direction and guidance of Dr. Christopher Ray, Sonny Diaz, Rogelio Monzon, and Ganesh Acharya.

Summary of Transaction

Delic will acquire all of the issued and outstanding shares of KIC from its shareholders ‎in a reverse triangular merger for a purchase price of USD$3,050,000 (the "Purchase Price") to be paid as follows: (i) USD$2,250,000 in consideration shares to be issued on the closing date (the "Closing Date Payment"); and (ii) USD$800,000 in consideration shares to be issued on the date KIC's Bakersfield, California clinic achieves a net profit in three consecutive months in the twelve months following the closing date, while achieving minimum revenues of USD$125,000 in the same three month period (the "Bakersfield Milestone Payment") plus certain amounts, ‎if any, to be earned by each of Sonny Diaz, Rogelio Monzon, and Ganesh Acharya, pursuant to a respective Milestone Agreement (as defined ‎below). The Closing ‎Date Payment will be satisfied by Delic's issuance to the KIC shareholders of the ‎number of consideration shares equal in value to the Closing Date Payment amount, ‎issued at a price per share equal to the hire of (a) the ten (10) trading day volume ‎weighted average price ("VWAP") of such consideration shares on the Canadian ‎Securities Exchange (the "Exchange") on the trading day immediately prior to the ‎closing date.‎

Each of Sonny Diaz, Rogelio Monzon, and Ganesh Acharya also entered into a milestone agreement (the "Milestone Agreement") ‎whereby they may each receive their pro rata proportion of an amount equal to USD$150,000 for each new clinic opened by KIC that is cash flow positive for three consecutive months after opening while achieving minimum revenues of USD$175,000 in those three consecutive months (each a "New Clinic Milestone") subject to certain conditions of continued employment or engagement with KIC. Such additional consideration to satisfied by Delic's issuance of ‎additional consideration shares at a price per share equal to the ten (10) trading day ‎VWAP of the consideration shares on the Exchange on the trading day prior to the ‎date the Milestone is reached. ‎

About DELIC Corp.

DELIC is the leading psychedelic wellness platform, committed to bringing science-backed benefits to all and reframing the psychedelic conversation. The company owns and operates an umbrella of related businesses, including trusted media and e-commerce platforms like Reality Sandwich and Delic Radio, Delic Labs, the only licensed entity by Health Canada to exclusively focus on research and development of psilocybin vaporization technology, MeetDelic the premiere psychedelic wellness event, and Ketamine Infusion Centers (under binding acquisition agreement) one of the largest ketamine clinics in the country. DELIC is backed by a team of industry and cannabis veterans and a diverse network, whose mission is to provide education, research, high-quality products, and treatment options to the masses.

The Canadian Securities Exchange ‎has neither approved nor disapproved the contents of this news release and does not accept responsibility ‎for the adequacy or accuracy of this release.‎

This news release does not constitute an offer to sell, or a solicitation of an offer to buy, any securities ‎in the United States. The securities have not been and will not be registered ‎under the United States ‎Securities Act of 1933, as amended (the "U.S. Securities Act"), or any state ‎securities laws and may not be offered or ‎sold within the United States unless registered under the U.S. ‎Securities Act and applicable state securities laws or an ‎exemption from such registration is available.‎

Forward-Looking Information and Statements

This press release contains certain "forward-looking information" within the meaning of applicable ‎Canadian securities ‎legislation and may also contain statements that may constitute "forward-looking ‎statements" within the meaning of ‎the safe harbor provisions of the United States Private Securities ‎Litigation Reform Act of 1995. Such forward-looking ‎information and forward-looking statements are not ‎representative of historical facts or information or current ‎condition, but instead represent only the ‎Company's beliefs regarding future events, plans or objectives, many of ‎which, by their nature, are ‎inherently uncertain and outside of DELIC's control. Generally, such forward-looking ‎information or ‎forward-looking statements can be identified by the use of forward-looking terminology such as ‎‎"plans", ‎‎"expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", ‎‎‎"anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or may ‎contain ‎statements that certain actions, events or results "may", "could", "would", "might" or "will be ‎taken", "will continue", ‎‎"will occur" or "will be achieved". The forward-looking information and forward-‎looking statements contained herein ‎may include, but are not limited to, information concerning listing on the Canadian Securities Exchange, anticipated continued growth in the health and wellness sector (and, in particular, related to psychedelics), the continued emergence of psychedelics from stigmas, the ability of the Company to maintain sensible messaging, the ability of the Company to avoid dogmatic practices and binary rhetoric‎, the ability of DELIC to successfully achieve business ‎objectives, ‎and expectations ‎for other economic, ‎business, and/or competitive factors.‎

By identifying such information and statements in this manner, DELIC is alerting the reader that ‎such ‎information and statements are subject to known and unknown risks, uncertainties and other factors ‎that may cause ‎the actual results, level of activity, performance or achievements of DELIC to be ‎materially different from those ‎expressed or implied by such information and statements. In addition, in ‎connection with the forward-looking ‎information and forward-looking statements contained in this press ‎release, DELIC has made certain ‎assumptions. Among the key factors that could cause actual ‎results to differ materially from those projected in the ‎forward-looking information and statements are the ‎following: the ability to consummate the Transaction; ‎ the potential impact of the announcement or consummation of the Transaction on ‎relationships, ‎including with regulatory bodies, employees, suppliers, customers and competitors; ‎changes in general economic, ‎business and political conditions, including changes in the financial ‎markets; changes in applicable laws; compliance ‎with extensive government regulation; and the diversion ‎of management time on the Proposed Transaction.‎

Should one or more of these risks, uncertainties or other factors materialize, or should assumptions ‎underlying the ‎forward-looking information or statements prove incorrect, actual results may vary ‎materially from those described ‎herein as intended, planned, anticipated, believed, estimated or ‎expected.‎

Although DELIC believes that the assumptions and factors used in preparing, and the expectations ‎contained ‎in, the forward-looking information and statements are reasonable, undue reliance should not ‎be placed on such ‎information and statements, and no assurance or guarantee can be given that such ‎forward-looking information and ‎statements will prove to be accurate, as actual results and future events ‎could differ materially from those anticipated ‎in such information and statements. The forward-looking ‎information and forward-looking statements contained in this ‎press release are made as of the date of ‎this press release, and DELIC does not undertake to update any ‎forward-looking information ‎and/or forward-looking statements that are contained or referenced herein, except in ‎accordance with ‎applicable securities laws. All subsequent written and oral forward- looking information and ‎statements ‎attributable to DELIC or persons acting on its behalf is expressly qualified in its entirety by this ‎‎notice.‎

NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN UNITED STATES

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