Seed Innov Regulatory News (SEED)

Seed Innovations Ltd / AIM: SEED / Sector: Closed End Investments

8 August 2022

SEED Innovations Ltd ("SEED" or, the "Company")

Further Investment in Wellness Brand Business, South West Brands Limited

SEED Innovations Ltd, the AIM quoted company focusing on making investments in fast growing and industry leading businesses with a focus on the medical cannabis, health and wellness space, is pleased to announce that it has invested a further £50,000 (the 'Investment') in South West Brands Limited ('SWB'), a London-based company that build and commercialise the wellness and beauty brands of the future. The Investment is by way of a three year, 8% Convertible Loan Note ('CLN') as part of a funding round by SWB to raise up to a maximum of £1,000,000, of which £570,000 has been secured.

In addition, SEED have agreed to convert £50,000 of the 12 month, 8% CLN subscribed for in July 2021 into this three year, 8% CLN (the 'Conversion'). 

The Investment and the Conversion takes the total amount invested by SEED in SWB to date to £500,000.

Highlights

● Further investment in female-led pioneering multi-brand consumer goods group focusing on the health & wellness segment, utilising plant ingredients including CBD to create unique and efficacious products

● Progress continues at SWB with two consumer brands now listed for sale at major UK High Street retailer and online:

o  LoveMeMeMe, a Gen-Z self-care brand that produces and markets all vegan and cruelty free skin, body and haircare products with CBD ingredients available at https://lovemememe.com and www.asos.com

o  FEWE, the world's first full cycle-care brand that is dedicated to helping women understand the science behind the monthly menstrual cycle, available at https://fewe.co.uk and www.superdrug.com, and instore from September

● The listings on ASOS and at Superdrug represent a significant step forward and a resounding endorsement for prominent retailers about the brands and the positioning while supporting the company's omnichannel approach to building their brands

● Addition of SWB's Botanic Lab drinks and supplements to the UK Food Standard Agency ('FSA') list of cannabidiol ('CBD') products permitted to stay on the market in England and Wales

Ed McDermott, CEO of SEED, commented: "We have seen some considerable progress made by the team at South West Brands over recent weeks with the launch of their two brands for sale in to Superdrug stores and online at ASOS. The products have received a fantastic reception by consumers in what is fast becoming a burgeoning FemTech sector where South West Brands are leading the charge.

"Generating early revenues, with the products now increasingly available, we anticipate seeing a fast uptick in wholesale sales which will further lead to additional product development and hopefully support for the products availability outside of the UK.

 "We are pleased to continue to support Rebekah Hall and her team as they build a credible, sustainable and scalable wellness business developing and commercialising their brands."

Rebekah Hall, CEO of SWB, said: "The progress SWB has made in the short time since launch is just the beginning of where we believe our brands can reach. In particular, we are at an exciting juncture in the provision of female wellness solutions with increased awareness infiltrating mainstream audiences and building commercial traction with mainstream retailers. With further funding in place, including the support from SEED, we look ahead to continued growth in the UK as well as commercial opportunities in other markets, including the US. "

Principal Terms of the Convertible Loan Note

The CLN will automatically convert into fully paid ordinary shares in SWB as follows:

· Completion of a fund raising by SWB to raise not less than £1 million (with not less than 50% from arm's length investors and not including this CLN) prior to the third anniversary of the issue of the CLN ('Fund Raise') at a 20% discount to the price per ordinary share of the Fund Raise; or

· On a Change of Control prior to the third anniversary of the issue of the CLN.

At the next equity investment round, SEED will receive one warrant for every four shares received at the price per share of such equity investment.

Interest shall accrue on the CLN at a rate of 8% per annum.

About South West Brands

South West Brands is a future facing multi-brands consumer goods group that builds and commercialises the wellness and beauty brands of the future, today. With a portfolio spanning menstrual wellness, Gen-Z beauty and functional drinks, SWB is laser focused on the "last-mile" of the value chain - brand, consumer, route to market. SWB brings wellness solutions to audiences globally through brand and celebrity led partnerships that deliver mass awareness. As a B Corp the SWB team is committed to growing the business in a way that reflects its values, champions its causes, and puts its commitment to its communities and the environment front and centre of everything it does. This is the essence of modern brand building.

Female founded and female led, SWB is particularly focused on brands and products that deliver solutions to underserved categories and consumers.

SWB recently launched two new brands to market; FEWE and Love, MeMeMe

FEWE is a first of its kind menstrual wellness brand creating fully inclusive solutions specifically tailored to the hormonal changes experienced throughout the menstrual cycle and peri-menopause. Rooted in education, and built utilising the findings of an in-depth 2000 person consumer study, the brand has received great prominence since launching in October'21, featuring in Marie Clare, Forbes, ES Magazine, Harpers Bazaar, Vanity Fair and many more. Products include solutions for skincare, sleep, comfort, mood and vulva care.

Love, MeMeMe is a digital first, celebrity and beauty content creator led brand. We speak to a young, trend-led audience, and have created an accessible yet premium feeling product portfolio of skin, body and haircare products utilising CBD and other high quality active skincare ingredients. The brand is led by TikTok superstars with a reach of over 3 million with chart topping sensation, singer Mae Muller, at the fore.

Schedule 4 Disclosure

In the Company's announcement dated 1 February 2021, it reported an initial £250,000 investment into SWB. This was followed by further investments of £50,000 in July 2021 and £150,000 in October 2021. With this latest £50,000 investment, the total amount invested by SEED in SWB to date is £500,000. SWB operates a licensed business model, with revenue being derived from royalty payments. Unaudited Wholesale Equivalent Sales for the first 6 months of trading to 31 March 2022 were £380,000. The initial investment of £250,000 converts at the next qualifying fundraising event (not including this CLN) into ordinary shares in SWB at the lower of a 37.5 per cent. discount to the next issue price and a conversion enterprise valuation of £5million.

ENDS

For further information on the Company please visit www.seedinnovations.co or contact:

Notes

SEED Innovations is an AIM quoted investment company focused primarily on disruptive high growth life sciences and technology businesses particularly within the medical cannabis arena. The Company's strategy is to identify early-stage opportunities that have an upcoming investment catalyst and grow its portfolio in terms of value whilst limiting the number of investee companies to a level where relevant time can be devoted to each.