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Generation Next Franchise Brands Announces Launch of Corporate Operated Robot Investment Fund

January 8, 2019

New structure will allow investors to own robotic frozen yogurt vending kiosks operated by the Company in return for passive income

SAN DIEGO, CA, Jan. 08, 2019 (GLOBE NEWSWIRE) -- via NEWMEDIAWIRE -- Generation Next Franchise Brands, Inc. (“Company” or “Generation Next”) announced today the launch of 19 Degrees Corporate Service LLC, a new investment vehicle for its network of current and future robotic soft serve vending kiosk owners.

19 Degrees Corporate Service, LLC will initially launch with 48 secured locations strategically placed throughout the country. Each robotic vending kiosk contributed to the investment fund as a single unit will receive their pro rata share of profits on a quarterly basis.

The advantages to the kiosk owners are as follows:

-- The switch from active to passive income; -- A more even distribution of revenue (i.e. a smaller piece of a bigger pie with lower risk). Each kiosk will be one of many, thereby leveling out revenue fluctuations, variability in location performance, and seasonality concerns; -- Faster installation of kiosks, as owners are now not tied to a small geographic circumference; -- A “no hassle” maintenance program provided by CSA Servicer Solutions https://www.csa-service.com/ that includes spare parts, consumables and cleaning supplies on each technician’s vehicle; -- A nationwide on-site flavor promotion plan managed by Dannon, the Company’s exclusive provider of consumables; -- Dannon is currently developing specifically for this program an aseptic packaging line meaning no need for refrigeration in vehicles or on site; and -- Access to a newly designed back-office portal that will allow members of the fund to remotely access each kiosk’s sales performance in “real time”, as well as a plethora of software features used to guide the fund’s performance.

To date, approximately 90 of the Company’s Reis & Irvy’s franchisees have expressed interest in joining the program, representing over 300 kiosks that could potentially be added to this fund. Furthermore, the company has identified and secured the first 48 locations in areas the company does not have franchisees that consist of the following categories: entertainment venues, military bases, malls, hospitals, government facilities, educational institutions, family fun centers, corporations and casinos. Some notable locations that will be receiving kiosks in February to kick start the program are Fort Gordon Military Base in Augusta GA, Paradise Cinema IMAX in Memphis TN, Great Lakes Crossing Mall in Auburn Hills MI and Ellis Hospital in Schenectady NY.

The Company will receive a service fee on gross receipts equal to 12%, as well as an administration fee of 1.5% of gross receipts.

“We love the idea of having highly trained, professional technicians provided by CSA Service Solutions operating the equipment efficiently and taking advantage of the economies of scale available,” said Nick Yates, CEO of Generation Next. “Dannon, our exclusive supplier of frozen consumables will be promoting flavors at the locations owned by the new 19-Degrees fund which we believe will result in each location producing the higher revenues. In some ways this was a no-brainer, there are franchisees that want to represent the Reis & Irvy’s brand in the field and there are some franchisees that prefer a business opportunity that is less hands-on. This new passive income program allows us to cater to both, something I believe both our franchisees and shareholders will appreciate. This will help us accelerate the installation of kiosks and sooner recognize the approximately $53 million of deferred revenues currently sitting on our books.”

The legal structure will be that of a Limited Liability Company (“LLC”), whereby each member will receive their portion of LLC taxable income allocation through the issuance of a Schedule K-1. Separately, the Schedule K-1 provides the Members the amount of cash and property distributions made to the Member, as well as a roll-forward of each Member’s capital account. Furthermore, the Company will file composite state returns, with required withholdings, where applicable, with the members filing in additional states.

Member ownership units in the LLC will be issued under the registration exemption Rule 506(c) of Regulation D of the Securities Act of 1933 and will be available only to accredited investors. Under Rule 506(c), general solicitation of offerings is permitted, however, purchasers in a Rule 506(c) offering must be “accredited investors.” The SEC defines the term “accredited investor” in Rule 501(a). Generally, individuals are considered accredited investors if they have a net worth greater than $1 million (excluding their primary residence) or incomes in excess of $200,000 in the last two years with the expectation of the same in the current year (or $300,000 with a spouse).

This press release does not constitute an offer to sell nor a solicitation of an offer to purchase any securities in any jurisdiction in which such an offer or solicitation is not authorized and does not constitute an offer within any jurisdiction to any person to whom such offer would be unlawful. The offering of securities will only be made solely pursuant to a Private Placement Memorandum, which will be made available to interested investors.

The securities offered will not be and have not been registered under the Securities Act of 1933, any state securities laws or the securities laws of any other jurisdiction and may not be offered or sold in the United States or the United States persons absent registration or an applicable exemption from registration requirements of the Securities Act is available.

For more information, visit the Reis & Irvy’s website at www.reisandirvys.com the Generation Next website at www.gennextbrands.com, or call Toll-Free (888) 902-7558.

About Generation NEXT Franchise Brands, Inc.

Generation NEXT Franchise Brands, Inc., based in San Diego, California, is a publicly traded company on the OTC Markets trading under the symbol OTCBB: VEND. Generation NEXT Franchise Brands, Inc. is parent company to Reis and Irvy’s, Inc. and Generation NEXT Vending Robots.

About Reis & Irvy’s, Inc.

Reis & Irvy’s, Inc. is a subsidiary franchise concept of Generation NEXT Franchise Brands, Inc. (VEND). Launched in early 2016, the revolutionary Reis & Irvy’s Vending Robot serves seven different flavors of frozen yogurt, ice cream, sorbets and gelatos, a choice of up to six custom toppings and to customers within 60 seconds or less at the point of sale. The unique franchise opportunity has since established itself as a high-demand product and currently showcases a franchise network both domestically and internationally.

This information is not intended as an offer to sell, or the solicitation of an offer to buy, a franchise. It is for informational purposes only. No Reis & Irvy’s franchises will be sold to any resident of any state until the offering has been exempted from the requirements of, or duly registered in and declared effective by, such state and the required FDD (if any) has been delivered to the prospective franchisee before the sale in compliance with applicable law. Currently, the following states in the United States regulate the offer and sale of franchises: California, Hawaii, Illinois, Indiana, Maryland, Michigan, Minnesota, New York, North Dakota, Oregon, Rhode Island, South Dakota, Virginia, Washington, and Wisconsin. If you reside in one of these states, or even if you reside elsewhere, you may have certain rights under applicable franchise laws or regulations.

Cautionary note on forward-looking statements

This press release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements include, among others, statements concerning our future financial performance, including statements regarding: our ability to generate revenue and recognize deferred revenue; our ability to timely launch delivery and installation of our frozen yogurt robots; and our ability to grow our franchising and licensing divisions and launch our corporate-owned and direct sales platforms. The Company bases these forward-looking statements on its current expectations, estimates and projections about future events and the industry in which it operates using information currently available to it. Actual results could differ materially from those discussed in, or implied by, these forward-looking statements. Forward-looking statements are identified by words such as “believe,” “anticipate,” “propose,” “expect,” “intend,” “plan,” “will,” “may,” “estimate,” variations of such words and other similar expressions. In addition, any statements that refer to expectations, projections or other characterizations of future events or circumstances are forward-looking statements. Factors that could cause actual results to differ from those implied by the forward-looking statements contained in this press release are set forth in our filings with the Securities and Exchange Commission (SEC), including our most recent Annual Report on Form 10-K for the year ended June 30, 2018, our Quarterly Reports, and our Current Reports on Form 8-K. Be advised that developments subsequent to this press release are likely to cause these statements to become outdated and the Company is under no obligation (and expressly disclaims any such obligation) to update or revise any forward-looking statements whether as a result of new information, future events, or otherwise.

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