Else Nutrition inks deal with Hong Kong company

February 20, 2020, Vancouver, B.C. – Else Nutrition Holdings Inc., the developer of novel plant-based infant nutrition, has announced that it has entered into an investment agreement with NewH2 Limited, a subsidiary of Health and Happiness (H&H) International Holdings Limited, a Hong Kong Stock Exchange company.

NewH2 has agreed to an investment of $5.75 million in Else as part of an aggregate private placement offering of up to $8 million.

Pursuant to the private placement, Else will issue up to 12,383,900 units at a price of $0.646 per unit. Each unit will consist of one common share and 0.25 share purchase warrants, with each whole warrant entitling the holder to acquire one additional common share of the company at an exercise price of $0.969 per share for a period of 30 months from the closing date.

NewH2 has agreed to purchase 8,900,928 of the units being offered, which will represent approximately 11.15 per cent of Else’s issued and outstanding common shares assuming all units are sold.

On closing of the offering, NewH2 and Else will enter into an investor rights agreement pursuant to which NewH2 will be granted certain rights to maintain its percentage holdings of common shares in Else through participation in future financings, and the right to hold one board seat on Else’s board of directors. Closing of the offering is expected to occur on or about Feb. 26, 2020, and is subject to obtaining stock exchange approval.

Else intends to use the proceeds of the offering to accelerate its anticipated launch in the United States scheduled for the second quarter of 2020, to enhance its toll manufacturing capabilities, to build its distribution relationship with H&H and expedite sales in the new territories, and to undertake additional marketing initiatives, as well as for general working capital.

Else has also announced a memorandum of understanding with Health and Happiness (H&H) Hong Kong Limited for the future distribution of non-dairy, non-soy baby formula and children nutrition drinks in France, Hong Kong, China (SAR), cross-border China, Australia, Italy, and mainland China. The parties will work together in the coming months to formalize distribution agreements and develop business plans for the aforementioned markets.

“We are thrilled about this relationship, and about the strong alignment between Else Nutrition and the H&H group,” Hamutal Yitzhak, CEO and co-founder of Else, said in a press release. “The strategic alignment with such a reputable, global and premium, health and wellness brand-builder, coupled with the investment, provide growth potential for our brand globally. It marks a significant milestone in our mission to change the way we feed our babies and families for generations to come, using real, clean, plant-based alternatives.”

H&H Group CEO Laetitia Garnier said the company is very pleased to make the investment and is looking forward to a successful partnership with Else.

“Our NewH2 innovation fund is working on some highly innovative ventures that align with emerging consumer trend. The plant-based trend is undeniably growing globally, but there are too few products that can fulfill consumers needs while bringing the right nutrition. Else’s revolutionary 100-per-cent, plant-based, non-soy infant formula is a unique proposition and partnering with Else is a unique opportunity for us to join forces with a very experienced and forward-thinking team, and to drive growth from an early stage with huge upside in a booming category.”

Else Nutrition is an Israel-based food and nutrition company focused on developing innovative, clean and plant-based food and nutrition products for infants, toddlers, children, and adults.

NewH2 is a food and nutrition company focused on research, development, manufacturing, marketing, sale and/or licence of innovative plant-based food and nutrition products to the infant, toddler, children and adult markets.