Organto Completes Sale of Three European Subsidiaries

About this update from Organto Foods, Inc.

Organto Completes Sale of Three European SubsidiariesVANCOUVER, BC and BREDA, NETHERLANDS / ACCESSWIRE / July 12, 2024 / Organto Foods Inc. (TSX-V:OGO)(OTC Pink:OGOFF) ("Organto" or the "Company"), a leading provider of organic and non-GMO fruit and vegetable products today announced that it has completed the sale of three of its wholly owned Dutch operating subsidiaries (the "Sale Subsidiaries") to an independent third-party purchaser (the "Purchaser") previously announced in the Company's news release dated June 5, 2024 (the "Sale Transaction").This divestiture is part of the Company's efforts to reposition its business and strengthen its balance sheet and was completed with the objective of improving the Company's financial position and path to profitability by streamlining operations. The Sale Transaction was negotiated on an arm's length basis between the parties which did not involve any non-arm's length parties.The Sale Subsidiaries are comprised of:Organto Europe BV ("Organto Europe");Fresh Organic Choice BV ("FORC"); andBeeOrganic BV ("BeeOrganic").Pursuant to the terms of the share purchase agreement between the Company and the Purchaser (the "SPA") in respect of the Sale Transaction, among other things:the Purchaser acquired all the outstanding shares in the capital of each of the Sale Subsidiaries for €1;the Purchaser assumed all of the Sale Subsidiaries' assets and liabilities, including:assets comprised of:current assets including cash, accounts receivable, inventories and prepaid expensescomputer equipment, office equipment and furnitureall trademark rights of BeeOrganic and FORC held by I AM Organic BVtheir customer lists, supplier lists, licenses, permits and rights to various operating systemsliabilities comprised of:accounts payable and accrued liabilitiesleasehold obligationsresulting in a net liability position of approximately C$4.2 million as at March 31, 2024 and approximately $4.0 million as at May 31, 2024.The Purchaser and the Company's subsidiary, I AM Organic BV, also entered into a trademark agreement to permit the Purchaser to continue to use certain brands and trademarks as detailed in the trademark agreement (the "Trademark") for a transitionary period of two years with certain existing customers who were being served prior to the Sale Transaction. I AM Organic BV will retain all ownership rights in the Trademark.Th...

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