Ehave Announces Asset Purchase Agreement with Zyus and Recapitalization Transactions

OAKVILLE, Ontario, March 25, 2019 /PRNewswire/ -- Ehave, Inc. (OTCQB: EHVVF) ("Ehave" or the "Company") today announced that it has entered into a definitive asset purchase agreement (the "Asset Purchase Agreement") with ZYUS Life Sciences Inc. ("Zyus"), pursuant to which Zyus will acquire all of the assets and rights relating to Ehave's health informatics platform for a total purchase price of CAD $3.2 million in cash and stock (the "Asset Sale"). In addition, Ehave has entered into agreements with the holders of its outstanding promissory notes and warrants to exchange them for common shares.

Asset Sale

Under the terms of the Asset Purchase Agreement, Zyus will acquire Ehave's intellectual property and license, marketing, and development agreements relating to its health informatics platform. Ehave will continue in its development and trials of digital assessments and therapeutic games for children with attention-deficit/hyperactivity disorder ("ADD/ADHD"), autism spectrum disorder ("ASD"), and other mental health challenges. Ehave's data-rich patient management, assessment, and remediation tools are designed to improve the lives of persons suffering from common mental health disorders. With Ehave, clinicians can make better treatment decisions across teams and disciplines while keeping patients informed and engaged throughout their mental healthcare journey.

The Asset Sale remains subject to the satisfaction of customary closing conditions, including applicable regulatory approvals, and the approval of the Company's shareholders. The Company intends to hold a special meeting (the "Meeting") of its shareholder to approve the Asset Sale, at which two-thirds (2/3) of the Company's shareholders present in person or represented by proxy must approve the Asset Sale. Further information regarding the Meeting and the Asset Sale will be provided in a management information circular, which will be mailed to the Company's shareholders in due course. Investors are cautioned that, except as disclosed in the management information circular, any information released or received with respect to the Asset Sale may not be accurate or complete and should not be relied upon.

As part of its review of the Asset Sale, Ehave engaged a Canadian investment bank to conduct a fair market assessment of the value of the Zyus stock that Ehave is to receive as partial consideration under the Asset Sale. Garfinkle Biderman LLP is acting as legal counsel to Ehave.

Recapitalization

In addition, as stated above, Ehave entered into agreements with holders of USD$2.8 million of promissory notes to exchange such notes for common shares. Ehave will also issue shares of Ehave common stock in return for the cancelation of 4,383,333 Ehave warrants and the cancellation of 8,051,791 Ehave stock options. As a result of the recapitalization described above, all outstanding promissory notes, warrants, and certain options were exchanged for common shares.

"These are transformative transactions for Ehave," said Prateek Dwivedi, Chief Executive Officer of Ehave. "First, we will be able to significantly strengthen our balance sheet by holding stock in Zyus, a company led by management with a proven track record in the medical cannabis space, as well as converting notes, warrants, and stock options into Ehave common stock. Second, we believe we will have adequate working capital to continue to drive our mental health operating business forward in a positive way. Finally, we will continue to evaluate additional merger and acquisition opportunities to maximize shareholder value."

About Ehave

Ehave, Inc. (OTCQB: EHVVF) is empowering the medical cannabis and mental healthcare community with a next generation of data-rich tools designed to improve patient management, diagnosis, and treatment.

Forward Looking Statements

This press release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements may be preceded by the words "intends," "may," "will," "plans," "expects," "anticipates," "projects," "predicts," "estimates," "aims," "believes," "hopes," "potential" or similar words. Forward-looking statements are based on certain assumptions and are subject to various known and unknown risks and uncertainties, many of which are beyond the Company's control, and cannot be predicted or quantified and consequently, actual results may differ materially from those expressed or implied by such forward-looking statements: (i) the parties to the Asset Purchase Agreement being unable to obtain the necessary director, shareholder and regulatory approvals in a timely manner or at all; (ii) changes in tax laws, general economic and business conditions; and (iii) the failure of any closing conditions to the Asset Purchase Agreement to be satisfied. All forward-looking statements included in this press release are made only as of the date of this press release. The Company assumes no obligation to update any written or oral forward-looking statement unless required by law. More detailed information about the Company and the risk factors that may affect the realization of forward-looking statements is contained under the heading "Risk Factors" in Ehave, Inc.'s Registration Statement on Form F-1 filed with the Securities and Exchange Commission (SEC) on September 24, 2015, as amended, which is available on the SEC's website, http://www.sec.gov.

Ehave Contact

[email protected]
(905) 362-1499

SOURCE Ehave, Inc.

Related Links

https://www.ehave.com/

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