Naturally Splendid Enterprises Ltd.
TSX VENTURE : NSP

Naturally Splendid Enterprises Ltd.

November 13, 2013 08:30 ET

Naturally Splendid Secures Exclusive Sales Agreement With Boreal Technologies for Canada and the United States for Plant Based Omega Products

VANCOUVER, BRITISH COLUMBIA--(Marketwired - Nov. 13, 2013) - Naturally Splendid Enterprises Ltd. (TSX VENTURE:NSP) (Naturally Splendid) is pleased to announce it has entered into a new Exclusive Sales Agreement with Boreal Technologies Inc. (Boreal) to market and distribute, on an exclusive basis in Canada and the United States, the full complement of patent pending, plant based omega products created by Boreal at the University of British Columbia.

The new Exclusive Sales Agreement replaces, in its entirety, the sales agreement dated May 15, 2013 between Naturally Splendid and Boreal whereby Boreal previously granted Naturally Splendid the right to market and distribute HempOmega™ in Canada on an exclusive basis and H2Omega™, on a non-exclusive basis.

The Products - Plant Based Omega Nutrition

The products covered in this Exclusive Sales Agreement have been expanded from HempOmega™ and H2Omega™ to now include FlaxOmega™, CanolaOmega™, ChiaOmega™, plant based omega products created from flax, canola and chia. These novel products utilize the same microencapsulation and liposome technologies as HempOmega™ and will also be available in both the powder format and an aqueous solution for increased flexibility in ingredient applications and/or stand-alone products.

The Technology

Developed by Boreal, HempOmega™ (powder form) and H2Omega™ (aqueous form) are proprietary omega products that utilize both microencapsulation and liposomal technology in the delivery process to the human digestive system. Preliminary testing has confirmed that these products have increased bioavailability and sustainability by encapsulating lipids and transforming the insoluble ingredients into a stable aqueous suspension.. The suspended particles can then be used in a liquid state or milled into a fine, flour-like substance. This procedure allows for multiple methods of product implementation: capsules, powders, beverages, etc. and precise control over dosage and uptake. This technology creates value-added ingredients and expands the market potential for oil-based substances which can prove challenging to formulate.

Boreal Chairman, Charlie Brink states, "At Boreal, we believe success is achieved through an unrelenting focus on innovation and execution. There is currently a huge revolution going on within the nutraceutical industries. We have taken a pains-taking amount of time assembling the right team of talent to develop and launch these unique, profitable, consumer products to market. One of the most exciting things before us is the opportunity to leverage the science and the research conducted in the laboratory over the past few years to create market-ready products that will enhance peoples' lives. Naturally Splendid has proven to be a strong partner in business and will be instrumental in bringing our science and products to market and ultimate commercial success."

The Nutrition Market

According to Nutrition Business Journal, the global nutrition industry is currently estimated to be approximately US$350 billion(1). The sector is represented by the following categories: natural and organic food; natural personal care; functional food; and dietary supplements. The global market for omega 3 products was valued at US$24 billion in 2011 by "Packaged Facts" and growth in the global, dietary supplement market is estimated at 12% annually(2).

In a recent Ipsos Reid survey conducted by BioAccess, Canadian respondents showed that a full 80% of Canadians are influenced to buy a product if it contains omega-3 fatty acids. Additionally, the survey found that 45% of all Canadians have used, or are currently using, omega-3 fatty acids in a natural health product format. And in the U.S., the Hartman Group found that 52% of Americans stated that they are attempting to increase omega-3 ingredients in their diets.

Craig Goodwin, Naturally Splendid CEO concludes, "It is abundantly clear the market is eager to purchase omega nutrition and the Naturally Splendid/Boreal Exclusive Sales Agreement offers a unique opportunity to provide natural, healthy and effective products to fill that need in a manner never before available to the global consumer". Naturally Splendid commissioned a report in conjunction with a grant from the National Research of Canada in which industry experts Mary Ellen Hodgins and Kelly Fitzpatrick report, "Consumer demand for omega-3 fatty acids has increased substantially since 2005. In Canada alone, there has been a 1,766% growth in consumption of omega-3 natural health products since 2005 according to studies conducted by Ipsos-Reid."

Distribution Strategy

The marketing and distribution of these omega products is multi-faceted and can be categorized as follows.

1. As an ingredient in proprietary or private label products marketed directly to market

Naturally Splendid has begun development of a number of proprietary products incorporating HempOmega™ and H2Omega™. Product development will now be expanded to include the complete line of plant based omega products. Launch of the first product lines is anticipated to be the first quarter of 2014. These products have the potential to be private labeled to enhance market penetration.

2. Provide plant based omegas as an ingredient to major brands to be added to existing and/or new product lines

Naturally Splendid has provided samples of HempOmega™ and H2Omega™ to major brands who have expressed interest in incorporating these products as an ingredient in a particular formulated product. Evaluation of these products has begun by these companies. Naturally Splendid will now offer the full range of the plant based omega products to these and additional companies.

3. Collaborate with Ingredient Suppliers to market as stand alone ingredients as well as co-develop ingredient formulations and solutions for their client base

Naturally Splendid plans to form strategic alliances with Ingredient Suppliers for distribution of plant based omega ingredients and/or product development incorporating the plant based omegas in custom formulations. Ingredient Suppliers provide large quantities of a wide range of ingredients to a clientele base that includes the largest food processors and food service companies in the world. As a strategic move to initiate this distribution strategy, Naturally Splendid announced in a news release dated September 10, 2013, the signing of an NDA with Calico Food Ingredients located in Kingston Ontario, Canada, and on November 5, 2013, Naturally Splendid announced an NDA with Caldic Canada Inc.

Goodwin states, "Both Calico Food Ingredients and Caldic Canada Inc. have begun evaluation of HempOmega™ and H2Omega™. We will now be able to offer a wider range of unique plant based omega products and solutions to these strategic partners who in turn can offer more products and solutions to their client base."

4. Food Service Industry

Naturally Splendid will offer plant based omega ingredients to the food industry, including institutional facilities, for incorporation of these ingredients into their product lines. The Food Service Industry can be divided into two categories - retail; and institutional. Retail includes but is not limited to multi-national restaurant chains and beverage distribution companies. Institutional includes but is not limited to hospitals and seniors care facilities, alternative medical services such as naturopaths and military.

Environmental Benefit

Naturally Splendid CEO, Craig Goodwin states, "Boreal's scientific discovery for the omega nutritional food market is truly remarkable. Converting nutritionally dense, plant based oils, which have somewhat limited applications and shelf life challenges, into soluble powder and aqueous forms has significantly increased the commercial potential for this environmentally friendly, renewable resource." Agricultural sources of omega offer a more sustainable and environmentally friendly alternative to marine based omega sources. Goodwin further states, "We are extremely proud that Naturally Splendid has partnered with Boreal in offering a line of products that are nutritionally good for you; an environmentally friendly and renewable resource and thus good for the planet; and yes, a product with exceptional commercial potential and thus an exciting business opportunity for Naturally Splendid."

About Naturally Splendid Enterprises Ltd.

Naturally Splendid markets a line of hemp-based products to a retail network of over 300 stores throughout British Columbia and into Alberta including; Save On Foods; Urban Fare; London Drugs; Marketplace IGA; and Sobeys. Naturally Splendid's recently branded "NATERA" line of products includes plain and flavoured shelled hemp seeds and plain and flavoured hemp protein powder.

Naturally Splendid has received federal and provincial funding towards the research and development of new hemp-based food products, HempOmega™ and H2Omega™, as well as for a strategic study to assess the feasibility of vertical integration. Success with these programs has opened the door to further government funding and support. Naturally Splendid is dedicated to providing the highest quality natural superfoods and delivering them to the general public in a tasty, nutritious manner.

About Boreal Technologies Inc.

Boreal Technologies Inc. ("Boreal") is a privately owned Canadian company located on the University of British Columbia campus in Vancouver, B.C. Boreal provides pilot manufacturing and process/product development for Omega fatty acids with an initial focus on industrial hemp. These technologies have been developed from active studies over the past few years and Boreal has been able to identify commercial applications for these technologies in the nutraceutical and pharmaceutical industries. This has led to new applications for selected food products that can incorporate these new forms of industrial hemp and other omega rich oils.

J. Craig Goodwin, CEO & Director

Forward-Looking Statements

Information set forth in this news release contains forward-looking statements that are based on assumptions as of the date of this news release. These statements reflect management's current estimates, beliefs, intentions and expectations. They are not guarantees of future performance. Naturally Splendid cautions that all forward-looking statements are inherently uncertain and that actual performance may be affected by a number of material factors, many of which are beyond Naturally Splendid's control. Such factors include, among other things: risks and uncertainties relating to Naturally Splendid's ability to complete sales of and develop new products of HempOmega™ and H2Omega™ and successfully incorporate HempOmega™ and H2Omega™ in its existing product line. Accordingly, actual and future events, conditions and results may differ materially from the estimates, beliefs, intentions and expectations expressed or implied in the forward-looking information. Except as required under applicable securities legislation, Naturally Splendid undertakes no obligation to publicly update or revise forward-looking information.

NEITHER TSX VENTURE EXCHANGE NOR ITS REGULATION SERVICES PROVIDER (AS THAT TERM IS DEFINED IN THE POLICIES OF THE TSX VENTURE EXCHANGE) ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.

(1) Nutrition Business Journal (2011) Global Nutrition Industry Overview. Volume XVI. No. 11/12. Nov/Dec 2011.

(2) http://www.startribune.com/business/133124358.html?refer=y

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