July 31, 2017 Last Updated 7:37 am

High Times sold again, this time to Origo Acquisition Corp, with valuation going from $70M to $250M

‘High Times is one of few household names in the cannabis industry. We believe that the barriers to entry are substantial, given the respect and trust associated with our brand’

Los Angeles, CA and New York, NY – July 27, 2017 – Hightimes Holding Corp., publisher of HIGH TIMES magazine and a leading voice of the cannabis community since 1974, and Origo Acquisition Corporation, a special purpose acquisition company, announced that they have entered into a definitive merger agreement. Upon closing of the transaction, High Times will be a publicly traded company.

High Times will utilize its public company status, diversified revenue streams, established and trusted brand name and deep grassroots following to capitalize on the ongoing, orderly conversion of the U.S. marijuana black market to a legal and regulated national industry.

High Times Business Overview

High Times is a diversified media, information services and live entertainment company focused on creating and distributing authoritative and engaging cannabis-related content. High Times is an iconic culture brand encompassing a venerated magazine, a website that is a cultural and e-commerce destination, as well as a respected news outlet, mobile applications and well-attended Cannabis Cup trade shows. High Times was founded in 1974 as a magazine and recently celebrated its 500th print issue. High Times’ expanding product and licensing deals will allow it to translate viewer passion into product sales with real-time transactions fueling fan engagement. Moreover, the ever-growing list of states legalizing the use of marijuana for medicinal and recreational purposes has increased demand for educational and social events such as High Times’ Cannabis Cup events.

Historically, High Times has been under-capitalized and unable to take advantage of broad opportunities in cannabis-related digital media, e-commerce, branding and licensing. However, in 2017 Oreva Capital, which is led by Adam Levin, gained control of High Times and began to position the company to better capitalize on its robust future growth. We believe that the merger with Origo will substantially improve High Times’ balance sheet and provide additional future growth capital. High Times operates through three primary segments, each of which is expected to achieve revenue growth in 2017.

  • Events: large-scale festivals and tradeshows targeting consumers and businesses in the cannabis space. High Times hosts multiple events on an annual basis throughout the U.S. where cannabis is legal.
    • Cannabis Cup is a large-scale music and product festival with judged product competitions, the winners of which are awarded a Cannabis Cup, a coveted award in the cannabis industry. Additionally, High Times organizes other events such as concerts, trade shows and cruises.
    • As legalization continues to open new, larger and expanded markets for Cannabis Cup, management is planning select, larger-scale events in new and existing geographies.
  • Licensing: branded content, merchandise and apparel utilizing High Times’ recognizable IP.
    • Current opportunities involve broader media projects outside of High Times’ traditional media space, clothing and branded accessories and cannabis-related accessories.
  • Media: print and digital/social.
    • Print: as High Times’ initial product offering in 1974, the High Times Magazine has become the definitive resource for all things cannabis, from cultivation and legalization to entertainment and culture. Currently, High Times generates print media revenue through subscriptions, newsstand purchases and ad sales.
    • Digital/social: High Times has developed an in-depth digital media strategy consisting of an online magazine, video content, e-commerce platforms and social media engagement.

Given the rapidly expanding acceptance and legalization of cannabis, High Times believes access to capital and an elevated profile via its anticipated public company listing will enable it to expand its brand, and fund new business opportunities that leverage nationwide medical and recreational usage initiatives.

High Times’ growth strategy includes the following:

  • Leveraging the High Times brand name by offering licensing and branding opportunities to events, dispensaries, lounges/hotels, retail stores, seed companies and consumer product companies.
  • Aggregating and monetizing new and existing enthusiast content using High Times’ marquee-branded, affinity-based digital platforms offering e-commerce, social media, advertising and data collection.
  • Expanding High Times-branded events and Cannabis Cup competitions, with dates planned in both new and existing geographies.
  • Utilizing traditional media as a continuity play, driving consumers to High Times online and enhancing branded licensed products.
  • Creating the definitive destination for cannabis knowledge through the development of education and distance learning.
  • Pursuing accretive acquisitions that enhance cash flow, increase site traffic and content, and extend branding opportunities.

Adam Levin, chief executive officer of High Times, stated: “High Times is one of few household names in the cannabis industry. We believe that the barriers to entry are substantial, given the respect and trust associated with our brand that comes from informing and entertaining people for over 40 years. As a leading authority in a rapidly growing and evolving industry, we believe the public market is the best vehicle for capturing and funding substantial market opportunities and championing the innovations emerging across the globe in this industry.”

Edward J. Fred, chief executive officer of Origo, stated: “We believe High Times has an important mix of qualities essential for success. High Times is a highly-recognized brand in a rapidly growing industry that has a very engaged base and increasing opportunities to leverage that following.”

High Times’ management team, led by Levin, will continue to run the combined company post-transaction.

Summary of Transaction

Origo will acquire 100 percent of the equity of High Times in exchange for 23,474,178 newly-issued shares of Origo. At closing and assuming no Origo shareholder redemptions, current shareholders of High Times and Origo will hold approximately 83 percent and 17 percent, respectively, of the issued and outstanding shares of the publicly traded company’s common stock. Two current members of the Origo Board, or their designees, will join High Times as independent directors.

The Boards of Directors of both High Times and Origo have unanimously approved the proposed transaction. Completion of the transaction is subject to approval by shareholders of High Times and Origo and other customary closing conditions.

For additional information on the transaction, see Origo’s Current Report on Form 8-K, which will be filed promptly and which can be obtained, without charge, at the Securities and Exchange Commission’s internet site: sec.gov.

EarlyBirdCapital, Inc. (“EBC”) served as financial advisor to Origo. CKR Law LLP acted as legal advisor to High Times, and Ellenoff Grossman & Schole LLP acted as legal advisor to Origo.

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