NaturalShrimp Closes Acquisition of Hydrenesis Aquaculture, LLC Press Release | 08/26/2021 Additional Technology Drives Current Shrimp Production and Scale Enables Product Expansion into $17 Billion Global Salmon Market, Barramundi and other Freshwater Fish Markets DALLAS, TX, Aug. 26, 2021 (GLOBE NEWSWIRE) -- via NewMediaWire -- NaturalShrimp, Inc. (OTCQB: SHMP), a Biotechnology Aquaculture Company that has developed and patented the first shrimp-focused, commercially operational RAS (Recirculating Aquaculture System), today closed the previously announced acquisition of the aquaculture assets of Hydrenesis Aquaculture, LLC for $12,500,000, consisting of $4,000,000 in cash and the balance due in NSI common stock, including a stock consideration payment at a price of $0.505 per share.
Hydrenesis, Inc. and Hydrenesis Aquaculture, LLC, headquartered in Pompano Beach, FL, are private technology owners and technology commercialization companies that partner with leading IP holders and industry insiders to commercialize innovative technologies in major industry sectors.
Hydrenesis “Redox” water treatment technologies have the ability to affect water chemistry and elevate water quality, and they are proving to be critical technologies for scaling hatchery and nursery systems and impacting growth and health metrics. Trials of the technology in Norway and Australia are showing preliminary efficacy in disease control in salmon, barramundi, and tilapia farming segments.
“The acquisition is expected to act as a major growth driver for NaturalShrimp, opening the door for expansion of our platform technologies into additional worldwide seafood markets, including salmon, barramundi, and other freshwater fish,” said Gerald Easterling, CEO of NaturalShrimp. “As long-term partners with Hydrenesis, we can immediately begin integration and deployment of the technology in our shrimp hatchery and nursery systems without interruption, and the acquisition is expected to be accretive to operations and earnings in fiscal year 2022.
“Extending commercialization of Hydrenesis technologies to additional species applications expands our addressable markets into the $17 billion global salmon market and other farmed freshwater fish. Demand for barramundi and tilapia continues to increase in the U.S., China, and other countries as consumers seek unique and sustainable fish options. The technology also expands our licensing opportunities, and we expect to file additional patents around the expansion of the application and use of the combined EC and Hydrenesis technology. Integrating Hydrenesis technology into our patented proprietary technologies will further advance our growth strategy and drive long-term value creation for our shareholders.”
David Antelo, CEO of Hydrenesis, Inc., commented, “Global demand for solutions within the aquaculture industry have afforded companies the opportunity to become leaders of innovation. It takes focus and persistence to provide viable, sustainable, and profitable solutions. Hydrenesis has striven to find the right relationships and we couldn’t be happier to join NaturalShrimp. Its executives are already technology focused and they have a deep understanding of how every aspect of water quality is going to be key to maximizing profitability in the indoor aquaculture sector. We’re looking forward to deploying our existing technologies together and to the joint development of exciting new technologies going forward that will lead the industry.”
Hey but what about this ? They both can’t be accurate ?
NOTE 6 – RIGHTS AGREEMENTS
On August 25, 2021, the Company, through their 100% owned subsidiary NAS, entered into an Equipment Rights Agreements with Hydrenesis-Delta Systems, LLC (Hydrenesis-Delta") and a Technology Rights Agreement, in a sub-license agreement with Hydrenesis Aquaculture LLC ("Hydrenesis-Aqua"), The Equipment Rights involve specialized and proprietary equipment used to produce and control, dose, and infuse Hydrogas® and RLS® into both water and other chemical species, while the Technology sublicense pertains to the rights to Hydrogas® and RLS®. Both Rights agreements are for a 10 year term, which shall automatically renew for ten year successive terms. The term can be terminated by written notice by mutual consent, or by either party upon a breach of contract, insolvency or filing of bankruptcy. The agreements accord the exclusive rights to purchase or distribute the technology, or buy or rent the equipment, in the Industry Sector, which is the primary business and revenue stream generated from indoor aquaculture farming of any species in the Territory, defined as anywhere in the world except for the countries in the Gulf Corporation Council.
The consideration for the Equipment Rights consists of the sum of $2,500,000, with $500,000 in cash paid at closing, and $500,000 to be paid on the first day of the next calendar quarter, plus $250,000 to be paid on the first day of each successive calendar quarter until the amount is paid in full.
Per the Terms set forth in the Technology Rights Agreement, the consideration is defined as the sum of $10,000,000, consisting of $2,500,000 in cash at closing, and an additional $1,000,000 within 60 days after closing, and $6,500,000 worth of unrestricted common shares of stock in the parent company, NSI, at a stipulated share price of $0.505. Determined with this stipulated price, 12,871,287 shares are required to be issued. Based on the market price on August 25, 2021 of $0.37, is the fair value of the shares is $4,762,376, which results in a fair value total consideration of $8,262,376. As of September 30, 2021, the shares are not yet issued and are therefore classified in Shares payable. The common shares are covered by a Lock-Up ad Leak-Out Agreement.
The terms of the Agreements set forth that NAS will pay to Hydrenesis 12.5% royalty fees. The royalties are calculated per all customer or sub-license revenue generated by NAS, NSI or any Affiliate, from the sale or rental of either the Technologies or Hydrenesis Equipment, based on gross revenue less returns, rebates and sales taxes. There are sales milestones for exclusivity, whereby if NAS fails to achieve a sales milestone starting in Year 3, the exclusivity rights in both of the Rights agreements shall revert to non-exclusive rights. To maintain the exclusivity for the subsequent year, the Company may pay the amount of the royalty fees that would have been due if the Sales Milestone had been meet in the current year.
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