TORONTO, ONTARIO--(Marketwired - Aug. 28, 2013) - SPOT COFFEE (CANADA) LTD. (TSX VENTURE:SPP) ("SPoT" or the "Company") is pleased to provide an update on its licensing transaction to grant licenses to Valshire, LLC for the development of SPoT Coffee cafés in the State of Florida. Effective January 1, 2013, the Company entered into a share exchange agreement for its jointly controlled entities, Valshire Spot Inc. ("SPoT Valshire") and Florida Spot LLC ("SPoT Delray Beach"), where the Company owns 100% of the Common Shares of SPoT Valshire and the Joint Venture partner owns 100% of the Common Shares of SPoT Delray Beach.
SPoT has now obtained all necessary permits for its second licensed café in the State of Florida, SPoT Coral Gables, and has initiated the build-out phase of the café. The Company has been earning an ongoing licensing fee of 5% of the revenue on a monthly basis from its licensed Florida cafés. In addition to earning an ongoing licensing fee charged quarterly as a percentage of each café's revenue, SPoT has also been earning revenue based on a 5% surcharge on the cost of all supplies of SPoT's award winning micro-roasted coffee, related coffee products and corporate branded material.
Further expansion of the Company's North American regional licensing program is expected to commence in 2014. The Company expects to license additional regions in 2014, increasing the amount of national expansion in subsequent years. The initial expansion of cafés will focus on southern Florida and all Florida cafés will continue to be developed and operated based on the café operating model successfully established by SPoT. The Florida licensing model will permit the Company to further develop and refine its broader regional licensing strategy.
The foregoing transaction is subject to review and final approval by the TSX Venture Exchange. As the principal of Valshire, LLC, Mr. Dahlawi, is a director and significant shareholder of the Company. Both he and Valshire LLC are considered to be "Non-Arm's Length Parties" under the rules and policies of the Exchange. Notwithstanding the foregoing, the proposed transaction is exempt from valuation and minority shareholder approval requirements under applicable securities laws.
About SPoT Coffee
SPoT Coffee trades on the TSX Venture Exchange under the symbol SPP. SPoT designs, builds and operates community oriented cafés that provides its customers with the highest quality service, signature made-to order meals and the world's finest in-house roasted gourmet coffee. Each SPoT café is distinctively designed to meet the uniqueness of the local neighborhood, creating a warm and friendly gathering place for the community. SPoT's commercial business focuses on retail stores, business accounts and third party resellers such as universities and hospitals.
Except for statements of historical fact relating to the Corporation, certain information contained herein constitutes forward-looking statements. Forward-looking statements are based on the opinions and estimates of management at the date the statements are made, and are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected in the forward-looking statements. Except as required by applicable securities requirements, the Corporation undertakes no obligation to update forward-looking statements if circumstances or management's estimates or opinions should change. The reader is cautioned not to place undue reliance on forward-looking statements.
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 the release.