AgraFlora Organics International
Inc. (“
AgraFlora” or the
“
Company”) (
CSE: AGRA) (Frankfurt:
PU31) (OTCPK: PUFXF), a growth oriented and diversified
international cannabis company, is pleased to provide the following
corporate updates pertaining to the Company’s vertically integrated
cannabis (“THC”) and cannabidiol (“CBD”) asset portfolio.
Over the past four quarters, AgraFlora has continued to deploy
an assertive corporate acquisition stratagem, amassing a diverse
portfolio of vertically integrated cannabis assets and industry
partnerships. Culminating with the Company’s recent acquisition of
a suite of unique downstream and cannabinoid product formulation
assets from Organic Flower Investments Group Inc. (“Organic
Flower”) (CSE: SOW)(FWB: 2K6)(OTC: QILFF), AgraFlora now
boasts the following upstream/downstream operations, partnerships,
off-take agreements, exclusive licences and asset exposure:
70 PER CENT OWNERSHIP STAKE IN PROPAGATION SERVICES
CANADA (“PSC”)
Pursuant to the terms of an executed asset purchase and sale
agreement between AgraFlora and Organic Flower, the Company now
controls 70 per cent of PSC’s flagship Delta Greenhouse Complex.
The Delta Greenhouse Complex is equipped with 2.2 million square
feet of dedicated cultivation area under glass and is widely
considered to be one of the most technically advanced and
environmentally efficient greenhouse operations in the world.
AgraFlora continues to achieve material progress with regard to
the retrofit and licensing of its bellwether Delta Greenhouse
Complex. After a comprehensive review of its anticipated final
preparations and submissions, including its affirmation of
readiness and video evidence package, the Company anticipates,
based on recent standard timelines for review and award and
assuming no major required amendments or augmentations, the award
of a cultivation licence from Health Canada by the fourth quarter
of 2019.
Upon successful award of its aforementioned Health Canada
cultivation license, the Delta Greenhouse Complex will hold claim
to the highly coveted spot as the world’s second largest cannabis
cultivation operation under glass, with an estimated replacement
cost of $190,000,000.
AgraFlora’s internal corporate projections indicate that upon
receipt its aforementioned cultivation license from Health Canada,
the Company’s Delta Greenhouse Complex will be the fourth largest
Licensed Producer (“LPs”) in Canada by 2020 funded production
metrics (see Figure 1), strategically positioned in close proximity
to Canada’s largest cannabis economic centres; Toronto and
Vancouver.
Figure 1.
Issuer |
2020 Estimated Annual Capacity (in grams) |
Current Market Capitalization |
Aurora Cannabis |
700,000,000 |
$10,272,832,000 |
Canopy Growth Corp. |
525,000,000 |
$19,036,764,000 |
Aphria |
255,000,000 |
$2,283,968,000 |
AgraFlora & PSC |
251,250,0001 |
$173,852,000 |
Tilray |
225,000,000 |
$3,793,000,000 |
The Green Organic Dutchman |
195,000,000 |
$894,586,000 |
Cronos Group |
150,000,000 |
$6,910,173,000 |
OrganiGram Holdings |
113,000,000 |
$1,304,743,000 |
Hexo Corp. |
108,000,000 |
$1,930,895,000 |
CannTrust Holdings |
105,000,000 |
$944,630,000 |
AgraFlora’s forecasted production metrics are further
substantiated the Delta Greenhouse Complex’s industry-leading
cultivation infrastructure, including:
- Fully integrated on-site natural-gas-powered power plant;
- Providing ample heat and electricity, while repurposing carbon
dioxide emissions to benefit the plants;
- Proprietary energy-efficient air exchange;
- Advanced climate and humidity control management
infrastructure;
- Ebb-and-flow watering systems to enhance complete irrigation
recapture and water treatment;
- 1.5-million-gallon hot water storage tank configured to store
energy produced during the day, for redistribution during non-peak
hours, thereby increasing operational efficiencies and reducing
associated energy costs; and,
- Multistage supplemental lighting augmented by natural sunlight
to foster optimized illumination equilibrium.
ACMPR LICENSED AAA HEIDELBERG FACILITY
AgraFlora’s wholly-owned subsidiary, AAA Heidelberg Inc. is a
licensed cannabis cultivation facility under Health Canada's Access
to Cannabis for Medical Purposes Regulations (“ACMPR”). The AAA
Heidelberg facility is equipped with five partitioned flower rooms,
affording the company ample canopy earmarked for ultra-premium,
artisanal craft cannabis cultivation.
Once fully optimized, it is forecasted that the AAA Heidelberg
facility may achieve annualized dried cannabis production
capabilities of circa one million grams, including the successful
recapture of 225,000 grams of premium cannabis trim to be
manufactured into ancillary value-added cannabis products.
The Company previously provided the following Q3 2019 - Q4 2020
operating guidance and licensing milestones pertaining to its AAA
Heidelberg facility:
- Application and anticipated receipt of a Health Canada awarded
sales licence;
- Application and anticipated receipt of a Health Canada awarded
processing licence;
- Application and anticipated receipt of a Health Canada issued
export permit;
- Proposed on-site dispensary as per Alcohol and Gaming
Commission of Ontario (AGCO) regulations;• Potential
1.5-million-purchaser catchment area within a 90-minute
radius;
- Importation of a catalogue of premium craft cannabis
genetics;
- Fully optimized production capabilities of circa one million
grams of ultra-premium dried craft cannabis flower, with potential
production expansion based off surplus cultivation areas
contemplated;
- Successful recapture of 225,000 grams of premium cannabis trim
to be manufactured into ancillary value-added cannabis
products;
- Successful harvest of inaugural ultra-premium craft cannabis
crop;
- Proposed export of finished cannabis form factors to emerging
marketplaces, including India and Thailand, achieving unit
contribution of up to $15 per gram.
INDUSTRIAL HEMP LICENSE
AgraFlora has applied for licensing with Health Canada under the
industrial hemp regulations of the Cannabis Act. The Company
anticipates that licence approval could be granted in the third
quarter of 2019, which will subsequently equip AgraFlora with the
ability to seed, cultivate and harvest industrial hemp at its
flagship 2.2 million square foot Delta, B.C. facility.
Upon successful grant of an industrial hemp licence, AgraFlora
intends to aggressively pursue proprietary CBD cultivar
development, as well as:
- Seedling development;
- Cultivar experimentation; and,
- Specialized fibre production.
AgraFlora anticipates that upon achieving full scale production,
its planned industrial hemp operations will provide ample feedstock
for its unique portfolio of product formulation and downstream
THC/CBD assets, including cannabinoid-infused beverages, edibles
and topicals.
CANNABINOID-INFUSED CONFECTIONARY, CHOCOLATE AND EDIBLES
MANUFACTURING
By way of an executed Asset Purchase Agreement (the “Agreement”)
with Organic Flower, AgraFlora controls an 80 per cent interest in
The Edibles and Infusions Corp. (“Edibles and Infusions”), a joint
venture (the “JV”) with one of North America's largest and most
storied manufacturer and distributor of chocolate and sugar
confectionary products.
The Company’s JV partner was established nearly a century ago
and has since become North America's largest confectionary fruit
slice manufacturer, supplying products to over 20,000 locations
across North America - most prominently Costco and Wal-Mart.
AgraFlora’s JV partner currently manufactures and distributes
several hundred unique stock keeping units (“SKUs”).
The JV will design and develop a 50,000-square-foot
manufacturing and product formulation facility, located in
Winnipeg, Manitoba. The facility will be operated by a roster of
experienced chocolatiers and confectioners, as well as equipped
with state-of-the-art manufacturing equipment capable of producing
an assortment of both cannabinoid/terpene-infused products for
medicinal, functional and adult use, including:
- Gourmet snacks including caramel popcorn, cheese biscuits,
cocoa cookies, glazed pecans and salty pretzels;
- Chocolates, toffees, caramels;
- Gummies, confectionary, gum;
- Baked goods;
- Flavoured tinctures;
- Powdered drinks; and,
- CBD- infused pet products.
Edibles and Infusions is working to finalize its applications
for a Health Canada standard processing licence, as well as a
cannabis sales licence. The Company anticipates the facility will
be fully operational by the first quarter of 2020 and, once
optimized, will be capable of generating in excess of $750 million
in annual sales revenue. Projected revenues are derived from
logical assumptions including the facility achieving full capacity
and the equipment operating seven days per week, 20 hours per
day with all product being sold to downstream distributors, with
the sales price based on current comparable retail pricing in
the USA.
Existing downstream capabilities will be buoyed by one of
Canada's leading sales forces, affording the JV the ability to
secure immediate shelf space across all major retail channels,
including:
- Groceries;
- Pharmacies;
- Convenience stores;
- Gas stations; and,
- Quick-service restaurants.
NON-ALCOHOLIC CANNABINOID-INFUSED BEERS AND CIDERS
FORMULATION
Through an exclusive partnership agreement with a leading
Toronto-based brewery (the “Brewhouse”), AgraFlora holds claim to
the exclusive formulation, manufacturing and distribution rights
for all cannabinoid-infused beverages developed at said Brewhouse.
Composed of a consortium of experienced brewery partners, the
Brewhouse has completed multiple production runs for prominent
European beverage brands, such as:
- Guinness;
- Augustiner; and,
- Innes & Gunn.
This exclusive partnership provides AgraFlora with preeminent
exposure to a collective of domestic and global brewery partners,
as well as further crystallizes a leading production platform for
the Company's cannabinoid-infused carbonated beverage product
offering, including:
- Non-alcoholic beers;
- Seltzers; and,
- Ready-to-drink (“RTDs”) beverages.
With its exclusive brewing partner, the Company plans to
commence product formulation and batch testing during third quarter
of fiscal 2019, with forecasted commercial production slated to
begin in fourth quarter 2019.
Equipped with custom production equipment and a captive
research, development and testing facility, as well as a
state-of-the-art brewing infrastructure, the Brewhouse is armed
with annual output capacity capabilities of 120,000 hectolitres
(“hl”). By comparison, Canadian brewer Steam Whistle Brewing
produces approximately 95,000 hl on an annualized basis.
The Brewhouse is nearing completion of major facility retrofit
initiatives, which are projected to increase its output capacity to
over 200,000 hl per annum. Upon completion of the retrofit,
aggregate capital expenditures deployed on the Brewhouse build out
will exceed $20 million.
In addition, the Brewhouse possesses the ability to package both
steel kegs and plastic one-way kegs in a plethora of fittings, and
is equipped with a 24-head rotary canning line, capable of
packaging a variety of container dimensions at a rate of over 100
million containers per year. The Brewhouse also boasts an adjoined
tasting and viewing facility (the “Taproom”) affording AgraFlora
the ability to showcase product launches, beer dinners, community
events and gallery showings.
CBD-INFUSED/HEMP OIL COSMETICS
MANUFACTURING
Via its wholly-owned subsidiary Canutra Naturals Ltd.
(“Canutra”), AgraFlora is equipped with cultivation, extraction,
manufacturing and distribution capabilities from its flagship
facility in Kent County, New Brunswick. Canutra manufactures and
distributes premium skin care, cosmetics and cannabinoid product
lines, including a suite of trusted consumer brands such as Whole
Hemp Health; a Canadian all-natural, hand-made skin care line,
formulated with organic hemp seed oil.
Canutra markets the Whole Hemp Health product line by way of
brick-and-mortar retail outlets, Amazon Prime, as well as direct to
consumer, through an integrated Shopify e-commerce platform.
Canutra's wholly owned subsidiary, Canutra Farms, owns and
operates 76 acres of unzoned agricultural land with 1,000 feet of
river frontage in Kent county, New Brunswick. Canutra Farms was
formerly a federally owned farm and research facility and is
equipped with over 17,500 square feet of commercial-grade
facilities and 12 separate structures. Canutra Farms was granted an
industrial hemp licence by Health Canada for its New Brunswick land
parcel in 2017.
Canutra was also awarded a cannabis research licence by Health
Canada in 2018. Additionally, Canutra boasts a research and
development partnership with the Universite de Moncton (“UM”).
Canutra will collaborate with UM to augment its portfolio of IP
including:
- Optimized cannabis/hemp cultivation techniques;
- Extraction methodologies;
- Cultivar development;
- Inoculation formulations;
- Proprietary cannabinoid profiles for future skin care product
lines.
Canutra's products are strategically manufactured in the same
county as Canutra Farms, affording Canutra the ability to swiftly
expand the breadth of its product line from its current SKUs to
more than 40 SKUs.
This turnkey manufacturing infrastructure positions AgraFlora to
capitalize on current and future market trends in the rapidly
expanding cannabis consumer products space. Canutra is finalizing
the development phase of a suite of innovative SKUs including:
- Organic cosmetics with anti-aging properties;
- Shampoos and conditioners; and,
- Sunscreens.
CBD-INFUSED PERFORMANCE PRODUCTS
By way of an exclusive North American manufacturing and
distribution agreement with the Toronto Wolfpack RLFC (“TWP”) and
HowlBrands, AgraFlora is positioned at the nexus of the burgeoning
CBD-infused performance products marketplace and the vast captive
audience of professional sports.
In collaboration with TWP and HowlBrands, the Company will
leverage its unique downstream and product formulation asset
portfolio to manufacture and distribute a suite of athlete-focused,
CBD performance products, including:
- CBD-infused topical creams;
- Therapeutic relief balms;
- Sport pain CBD tinctures;
- CBD-infused soaks; and,
- CBD-infused roll-ons and healing sticks- engineered for optimal
topical absorption.
AgraFlora and HowlBrands are preparing to launch an inaugural
CBD-infused SKU, Rugby Strength; a replenishing body topical cream
infused with 125 milligrams of CBD extract, derived from
organically grown cannabis sativa L.
Rugby Strength is uniquely formulated to optimize the
transdermal absorption of CBD's analgesic, anti-inflammatory and
anti-anxiety healing properties. HowlBrands and TWP aim to cater to
professional and amateur sports teams, as well as individual
athletes through diverse product offerings formulated to:
- Reduce the pain and discomfort resulting from intense and/or
frequent wear and trauma on weight-bearing joints;
- Support reparation and recovery; and,
- Enhance fitness and performance.
NICORETTE-INSPIRED SUBLINGUAL CANNABINOID PRODUCT
LINE
AgraFlora has secured the exclusive North American rights to a
proprietary manufacturing system, enabling the production of
cannabinoid-infused therapeutic gum, chewable tablets and
capsules.
The Company's next-generation line of medicinal-use cannabis
products is inspired by popular demand of Nicorette's branded
therapeutic products, boasts the following:
- Proprietary dual-delivery technology: advanced patented
processes reduce surface tensions, increase binding of molecules
and enable homogenous mixing;
- Rapid sublingual activation: optimized absorption methodologies
facilitate a rapid onset within the first 15 minutes of
application; and,
- Metabolism efficacy: metabolizes in the liver to create a more
lasting effect.
LIBRARY OF PATENTED PRODUCT FORMULATIONS
AgraFlora has also obtained the Canadian exclusive rights to a
catalogue of cannabinoid-infused product formulations from a global
formulation provider with over three decades of experience working
with leading consumer product goods (“CPG”) brands. The Company has
engaged a roster of food engineers, nutritionists and scientists to
optimize bioavailability, consistent dosing protocols and
flavouring of the AgraFlora’s licensed formulations.
AgraFlora will continue to leverage its production and
processing assets, while further activating its downstream
activities by launching cannabinoid-infused beverages, edibles and
personal care products; specifically formulated with patented micro
diffusion technologies.
These proprietary formulation and manufacturing processes are
specifically adapted to ensuring consistent dose delivery, while
maintaining taste and texture integrity. AgraFlora’s patented
formulations will be adjusted based on a various production
variables, including:
- Altitude;
- Barometric pressures;
- Production time of day; and,
- Humidity.
BEVERAGE BOTTLING AND DOWNSTREAM
DISTRIBUTION
The Company holds claim to a complementary exclusive
cannabinoid-infused beverage supply and distribution agreement with
a Canadian bottling facility (the “Bottler” or the “Facility”). The
Facility is strategically situated in the Greater Toronto Area
(“GTA”), affording AgraFlora unbridled access to the largest
addressable Canadian marketplace. The GTA is buoyed by established
infrastructure, offering the flexibility to accommodate shipments
from multiple ports and hubs across North America.
The Facility is equipped with state-of-the-art bottling
equipment, configured to conduct rapid production runs, with
minimal downtime for production line changeovers. Fully
operational, the Facility has been granted the following industry
certifications:
- Good manufacturing practices (“GMP”);
- Canadian organic standards;
- Certified vegan;
- Fair trade certification (“ISO 17065”); and,
- Kosher facility status.
AgraFlora will leverage the Facility to produce a suite of both
cannabinoid-infused and functional beverages. The Facility is
currently configured to produce formulations for water, coffee,
tea, juice and carbonated sodas in a variety of formats, including
glass bottles, polyethylene terephthalate (“PET”) bottles and
aluminum cans.
The Bottler has the capabilities to develop and produce premium
beverages that exceed market standards, by leveraging innovative
industry technologies, including:
- Pharmaceutical-grade mixing tanks;
- Advanced UV sterilization; and,
- Custom extended-shelf-life (“ESL”) bottling lines.
UNIQUE CANNABINOID DELIVERY SYSTEMS INTELLECTUAL
PROPERTY (“IP”)
AgraFlora controls the exclusive rights to a portfolio of
disruptive cannabis beverage delivery assets and intellectual
property (IP). This acquisition will position AgraFlora as the
industry's sole Canadian manufacturer and distributor of an
innovative beverage dispensing cap technology, equipped with a
proprietary cannabinoid delivery mechanism.
The Company will incorporate its planned cannabinoid-infused
beverages lines with its patented pharmaceutical-grade dispensing
cap technology, as well as advanced delivery mechanisms, providing
optimized ingredient effectiveness for the end consumers. Refined
over five years, with research and development expenditures of $30
million, AgraFlora will leverage its exclusive rights to a marquee
dispensing cap technology and delivery mechanism to revolutionize
the North American cannabinoid-infused beverage marketplace.
The state-of-the-art delivery technology is certified for health
care and pharmaceutical applications; AgraFlora anticipates that it
will pioneer an elevated industry standard of quality.
The delivery mechanism boasts a patented airtight and
moisture-resistant bottle cap to protect volatile ingredients such
as cannabinoids, antibiotics, probiotics, vitamins and minerals
resulting in superior shelf stability for infused bottled
beverages. The dispensing cap technology allows for increased
efficacy when compared with premixed beverages, which are
susceptible to rapid nutrient deterioration.
THC OVERDOSE ANTIDOTE
The Company has been granted the Canadian exclusive sublicense
(the “sublicense”) for True Focus Canada’s product suite and
proprietary IP portfolio, including its patent pending ‘THC
Overdose Antidote’. The sublicense permits the exclusive domestic
marketing, distribution and development of the aforementioned THC
Overdose Antidote for a period of ten years.
With this exclusive sublicense, AgraFlora is now armed with a
suite of all-natural, nutraceutical formulations, coupled with an
intuitive delivery system designed to mitigate the negative side
effects associated with excessive THC consumption. The
aforementioned product formulations are considered patent pending
by way of a U.S. Patent and Trademark Office (“USPTO”) patent
application.
Delivered to the end consumer through a pocket-sized,
user-friendly spray bottle, True Focus's revolutionary formulations
are designed to be ingested in a sublingual manner.
Recreational cannabis consumption for the purpose of achieving
desired levels of euphoric or psychoactive effects can at times
lead to adverse and unwanted side effects, given the lack of
consistent doses distinction or historical use. True Focus's
patent-pending formulation offers a unique solution to alleviating
undesirable symptoms associated with a THC overdose.
EXCLUSIVE REGISTERED TRADEMARK PORTFOLIO
By way of its wholly owned subsidiary, Trichome Cannabrands Inc.
(“Trichome”), the Company has aggregated portfolio of 57 registered
trademarks in Canada for a diversified range of cannabis products
and services, including:
- Medicinal cannabis: for the relief of nerve pain, treatment of
muscle spasms caused by multiple sclerosis, relief of nausea caused
by chemotherapy, temporary relief of seizures and cannabis oil for
the treatment of cancer;
- Recreational cannabis: on-line and retail sale of cannabis,
cannabis-related products, derivatives of cannabis and natural
health products containing cannabis;
- CBD-infused performance products: CBD oil for medical purposes,
topical anesthetics, antibiotic cream and anti-inflammatory
ointments;
- Packaging and vape products: packaging of cannabis,
cannabis-related products, derivatives of cannabis and natural
health products containing cannabis, and cannabis oil for
electronic cigarettes;
- Cosmetics: makeup, beauty care cosmetics, eye cream, body
creams, massage creams, massage oils, skin care preparations, body
powders, body oils, bath soap, moisturizing skin lotions, body
sprays used as personal deodorants and fragrances, non-medicated
bath salts, exfoliating scrubs for the body, and bath oils;
- Candy, chocolate and edibles: cannabis oil for food and edible
oils, chocolate bars infused with cannabis, brownies containing
marijuana, chocolate, and sugar confectionery;
- Beverages and bottling: non-alcoholic fruit-based beverages,
carbonated soft drinks, sports drinks, beverage flavourings,
beverages made of coffee and tea;
- Cannabinoid infused beers and ciders: alcoholic-based
beverages, alcoholic fruit beverages and alcoholic tea-based
beverages.
Included in the portfolio of trademarks are regional airport
codes, telephone area codes and other such recognizable regional
identifiers that show significant branding potential for the
cannabis space. AgraFlora intends to leverage these registered
trademarks throughout a wide array of corporate branding
exercises.
OFF-TAKE AND COMMERCIAL RIGHTS AGREEMENTS
Furthermore, AgraFlora has secured commercial rights and
off-take agreements with ICC International Cannabis Corp. (CSE:
WRLD.U)(FWB: 8K51)(OTC: WLDCF) ("ICC" or “International Cannabis”),
as well as Namaste Technologies Inc. (TSXV:
N)(FWB: M5BQ)(OTCQB: NXTTF) (“Namaste”), whereby ICC and Namaste
may purchase up to 100,000,000 grams and 25,000,000 grams of
premium dried cannabis from the Company’s Delta Greenhouse Complex,
respectively.
These off-take agreements will further de-risk AgraFlora’s low
cost domestic cannabis production by providing the Company with the
opportunity to capture significant cash flows at both the upstream
and downstream layers of the cannabis value chain; realizing
material exposure to both the wholesale and eventual retail
distribution of dried cannabis into high-value domestic and
international patient populations.
In addition, AgraFlora and ICC have entered into a commercial
rights agreement, affording the Company unencumbered access to
cannabis processing/finishing at ICC’s EU-GMP certified
facilities.
In anticipation off-take delivery from AgraFlora, ICC is
architecting its first purpose-built, EU-GMP compliant cannabis
processing, manufacturing and packaging facility. It is anticipated
that ICC's finishing facility will function as a premier European
cannabis-processing hub, through which:
- Cannabis produced/procured from ICC's contract
farming and off-take agreements can be securely shipped to the
finishing facility;
- Cannabis manufacturing and processing will then be initiated at
ICC's finishing facility according to GMP-certified manufacturing
specifications and,
- The now finished GMP-certified cannabis can be packaged for
export and/or leveraged as GMP-compliant cannabis inputs to produce
a portfolio of diverse, designer product formulations.
GMP-certified cannabis products are eligible for import/export
to the European Union, thus achieving higher margins, all while
removing barriers to entry for the penetration of high-value EU
patient populations. GMP certification is an internationally
recognized system, mandated with ensuring all produced goods meet
the highest consumer health and safety standard.
The aforementioned commercial rights and off-take agreements are
contingent on AgraFlora receiving its cultivation and sales
licences from Health Canada for its Delta greenhouse complex
operations.
EUROPEAN DISTRIBUTION AND COLLABORATION
AGREEMENT
In addition, AgraFlora has inherited a European distribution and
collaboration agreement with ICC, affording the Company unbridled
access to a trans-European distribution network is composed of
80,000 retail outlets and pharmacies, spanning 16 countries,
including: Germany, the United Kingdom, Ireland, Denmark, Italy,
France, Spain, Poland, the Netherlands and Greece.
AgraFlora’s European distribution network is augmented by
various value-added services, including:
- Strategic procurement;
- Warehousing;
- Product registration;
- Regulatory representations.
AgraFlora will remunerate International Cannabis according to a
floating royalty matrix based on the net sales of products sold
through ICC's European distribution channels.
Brandon Boddy, Chief Executive Officer and Chairman of AgraFlora
stated: “By way of astute acquisitions, synergistic partnerships
and surgical execution, AgraFlora has grown from a $2.5 million
market capitalization to over $175 million in rapid fashion. The
acquisition of Organic Flower instantaneously amplified our
enterprise value by a factor of two, in addition to crystalizing
our corporate roadmap as the Company prepares to enter the
billion-dollar arena.
These tactical acquisitions from proven operators further
augment our existing portfolio upstream cannabis assets with a
suite cannabinoid-infused food/beverage product formulation and
manufacturing assets. Turnkey solutions, including ingredient
sourcing, manufacturing, testing and analytics, will further
crystallize AgraFlora’s pole position as a thought leader
throughout the next phase of cannabis normalization,” continued
Boddy.
Further to the Company’s recently completed transaction relating
to the acquisition of downstream and product formulation portfolio
(the “Asset Portfolio”) from Organic Flower (see June 7th, 2019
news release), the aggregate purchase price (the “Purchase Price”)
payable by AgraFlora to Organic Flower for the Asset Portfolio
shall be the issuance of an aggregate number of common shares in
the capital of AgraFlora that is equal to 1.15 multiplied by
302,703,697 (the “Payment Shares”), as fully paid and
non-assessable.
AgraFlora and Organic Flower also agree that with respect to the
issued and outstanding convertible securities of the Company (the
“Convertible Securities”), the holders thereof (the “Organic Flower
Convertible Security Holders”) shall have the option to exercise
their respective Convertible Securities into either common shares
in the capital of Organic Flower or AgraFlora on identical terms
and conditions of the Convertible Securities effective as at
closing of the transaction. For greater certainty, the Convertible
Securities may be exercised for either common shares of Organic
Flower or common shares of AgraFlora, and not common shares of both
parties. The Company and Organic Flower will do all such acts and
things as may be necessary or desirable, including without
limitation, amending the certificates and documents evidencing the
Convertible Securities, to assure that the exercise rights are
fully effected. There will be a voluntary 12-month hold period
applied to all Convertible Securities exercised into the share
capital of AgraFlora.
About AgraFlora Organics International Inc.
AgraFlora Organics International Inc. is a growth oriented and
diversified company focused on the international cannabis industry.
It owns an indoor cultivation operation in London, ON and is a
joint venture partner in Propagation Service Canada Inc. and its
large-scale 2,200,000 sq. ft. greenhouse complex in Delta, BC. The
Company has a successful record of creating shareholder value and
is actively pursuing other opportunities within the cannabis
industry. For more information please visit: www.agraflora.com.
ON BEHALF OF THE BOARD OF DIRECTORS
Brandon Boddy Chairman & CEOT: (604) 682-2928
For additional information:
AgraFlora Organics International Inc. Tim
McNultyE: ir@agraflora.com T: (800) 783-6056 |
For French inquiries: Remy
Scalabrini, Maricom Inc.E: rs@maricom.ca T: (888)
585-MARI |
The CSE and Information Service Provider have
not reviewed and does not accept responsibility for the accuracy or
adequacy of this release.
Forward-looking Information Cautionary
Statement
Except for statements of historic fact, this
news release contains certain "forward-looking information" within
the meaning of applicable securities law. Forward-looking
information is frequently characterized by words such as "plan",
"expect", "project", "intend", "believe", "anticipate", "estimate"
and other similar words, or statements that certain events or
conditions "may" or "will" occur. Forward-looking statements are
based on the opinions and estimates 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 anticipated in the forward-looking statements
including, but not limited to delays or uncertainties with
regulatory approvals, including that of the CSE. There are
uncertainties inherent in forward-looking information, including
factors beyond the Company’s control. There are no assurances that
the business plans for AgraFlora Organics described in this news
release will come into effect on the terms or time frame described
herein. The Company undertakes no obligation to update
forward-looking information if circumstances or management's
estimates or opinions should change except as required by law. The
reader is cautioned not to place undue reliance on forward-looking
statements. Additional information identifying risks and
uncertainties that could affect financial results is contained in
the Company’s filings with Canadian securities regulators, which
are available at www.sedar.com.
___________________________
1 Forecasted production metrics derived upon achievement of
optimized production at AAA Heidelberg and the Delta Greenhouse
Complex
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