The consumer products wholesaler AMCON Distributing Company has terminated a letter of intent agreed with its CEO, chairman and largest shareholder, William F. Wright, under which Wright would have acquired 80% of the AMCON subsidiary The Healthy Edge, a health and natural products retailer with operations across a number of states.
It was envisaged that at the time of the proposed acquisition The Healthy Edge would have incorporated 100% of the equity of several other directly or indirectly owned AMCON subsidiaries, comprising Health Food Associates, Chamberlin’s Natural Foods and Hawaiian Natural Water Company, along with 85% of the equity of Trinity Springs, also a subsidiary of AMCON.
The termination of the agreement was due in part to a judgment by the District Court of the Fifth Judicial District of the State of Idaho ruling that stockholders of Trinity Springs did not validly approve the sale of its business and assets because the vote of certain shares issued as a dividend should not have been counted. The District Court is yet to rule whether any damages will be due to shareholders as a result.
While the letter of intent has been terminated, AMCON stated that it would still be required to pay a termination fee to the buyout group led by Wright if it goes ahead with any sell-off of The Healthy Edge to a third party that is the subject of a letter of intent or agreement signed prior to the end of February this year.