Lucy Scientific Acquires High Times Intellectual Property, Including Existing Licensing Agreements in All-Stock Transaction

VANCOUVER, British Columbia, September 6, 2023 – PRESS RELEASE – Lucy Scientific Discovery Inc., a psychotropic business, announces the acquisition of the intellectual property (IP) of High Times, a brand in the cannabis industry. This acquisition provides a stream of high-margin licensing and royalty income from High Times, Cannabis Cup and 420.com brands, including their respective domain names. 

Lucy will issue 19.9% of its outstanding stock to High Times and make payments semi-annually for the next five years based on EBITDA generated from the acquired IP, which can be settled with either stock or cash at Lucy’s option. Additionally, Lucy will license the right to operate retail stores and manufacture and sell THC products in the United States back to High Times, in return for a license fee of $1.0M per year, increasing to $2.0M per year upon federal legalization. The transaction is subject to customary closing conditions and is expected to close within two weeks.

Lucy will be acquiring brand rights with plans to monetize the IP through current and planned royalty agreements by further extending and enhancing the existing domestic and international licensing arrangements currently held by High Times, including consumer products and merchandise. The company intends to preserve the essence of the High Times, Cannabis Cup and 420.com brands while identifying new avenues for growth and development.

The company expects the acquisition of High Times IP, including the 18 licensing agreements across various product categories it will acquire, to add at least $10M of revenue and $5M of EBITDA to its 2024 results and provide a solid foundation of growth as cannabis becomes legal around the world.

Richard Nanula, CEO and executive chairman at Lucy Scientific Discovery Inc., commented, "Lucy expects this acquisition to drive high margin revenue quickly and sustainably across the cannabis sector around the world. This is a great opportunity to grow the market presence of the nearly 50 year old High Times brand globally through licensing and online distribution.  We are confident that this opportunity can add significant value for our shareholders.”

Adam Levin, executive chairman of High Times added, “Over the past few years, we have been building the consumer products offerings for High Times and there is no better partner than Lucy to drive our iconic brand forward. This transaction will open up tremendous new opportunities to grow and expand the High Times brand led by Richard Nanula, who has decades of experience with some of the biggest consumer brands and companies in the world. We are delighted to become large Lucy shareholders.”