Vejii Holdings Ltd. (VEJI.C) Closes Acquisition of VEDGEco USA Inc.

Vejii Holdings Ltd. (VEJI.C), a North American online marketplace for plant-based sustainable products, announced today that it has completed the acquisition of VEDGEco, a leading online business-to-business (B2B) wholesale platform for plant-based products, as of December 31, 2021.

“Between going public and completing our acquisition of Vegan Essentials and then VEDGEco, 2021 closed on a high note for us…I feel we have proven our ability to execute our plans and objectives, getting two deals closed in two months, and the stage is now set for growth in 2022 as Vejii will be able to service our brand partners through our direct to consumer marketplace and business to business through the addition of VEDGEco,” said Darren Gill, President and COO of Vejii.

VEDGEco. USA Inc.

Launched in 2020, VEDGEco is the first nationwide plant-based wholesaler offering a selection of plant-based options that are easy to prepare. The company ships frozen plant-based products in bulk to restaurants and the wholesale food industry, as well as to consumers across the United States. The company’s products include a curated selection of plant-based meat, dairy, and egg alternatives shipped frozen in recyclable and compostable packaging. With this in mind, VEDGEco’s is a versatile platform, covering both B2B and business-to-consumer (B2C) operations.

VEDGEco personally tastes tests everything the company carries, including brands like JUST and Impossible Foods. In addition to these well-known brands, VEDGEco carries a selection of independent brands, including ForA: Butter and the BE-Hive. The company also offers VEDGEco exclusives like NoDoh Brand Mozarella-Style Sticks. Moreover, VEDGEco enables restaurants across the U.S. to buy plant-based products without a minimum order requirement, however, orders over $250 are shipped for free.

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VEDGEco’s key personnel are expected to continue to run the company’s operations following its acquisition, which is expected to close on or around December 31, 2021. In addition to providing VEDGEco’s existing offering of wholesale plant-based products, Vejii is now able to significantly expand VEDGEco’s product selection by leveraging its existing case-lot purchasing and expanding the range of products on its platform through VEDGEco. For context, case-lot purchasing refers to purchasing products by the case, or in other words, bulk.

Furthermore, with distribution centers in Hawaii and California, VEDGEco’s operations will expand Vejii’s distribution network, thereby reducing shipping costs and increasing the Company’s offering of regionalized same-day delivery. On the other hand, VEDGEco will now have access to Vejii’s facilities in Texas, Wisconsin, and the Company’s soon-to-be operational third-party logistics operations in Southern California.

Additionally, the acquisition of VEDGEco is expected to significantly augment Vejii’s offering of plant-based brands, which currently leverage the Company’s platform for sales, marketing, order fulfillment, and distribution across the US and Canada via Vejii Fulfillment Services.

“I built VEDGEco out of a necessity, given the limited plant-based options available in the small and local grocers and restaurants where I live in Kailua, Hawaii…Most of us are likely to have our first experience trying new plant-based products at a restaurant before purchasing those items to enjoy at home. With VEDGEco, our mission is to make plant-based options more broadly available by making them accessible to thousands of local restaurants across America…

This access gives owners the ability to test products on their menu through our easy-to-use platform, without the need for long-term commitments or high, minimum order volumes. Owners can then see what works for their customer base and then return to re-order or test new options,” stated Trevor Hitch, CEO of VEDGEco.

Transaction Details

Pursuant to the terms of the acquisition, the Company will acquire 100% of the issued and outstanding shares of VEDGEco from the shareholders of VEDGEco, the vendors. The total purchase price for the purchased shares will be USD$6,250,000, payable as follows:

(a) on the date of the closing of the transaction, the Company will issue such number of common shares of the Company with a deemed value of $3,500,000 to the vendors, as determined based on a price per Consideration Share of the greater of:
- (i) CAD$0.35 per Consideration Share and
- (ii) the closing price of the Common Shares on the Canadian Securities Exchange on the date immediately preceding the announcement by the Company of the transaction, converted into United States dollars at the Bank of Canada exchange rate on such date
(b) earn-out payments up to a maximum of USD$2,750,000, payable in common shares, priced in the context of the market, to be issued to the vendors upon VEDGEco meeting certain milestones as more particularly set out in the purchase agreement.

The Consideration Shares and the Earn-Out Shares issued under the purchase agreement are subject to a statutory hold period of four months and one day, restrictions on transfer under applicable United States securities laws, and a contractual lock-up as set out in the acquisition agreement. Subject to compliance with applicable securities laws, 12.5% of the Consideration Shares and the Earn-Out Shares will be released from the voluntary lock-up on a quarterly basis for a period of 24 months from the date of issuance.