Organic Flower Investments Group Inc. (CSE: SOW)(FWB:
2K6)(OTC: QILFF) ("Organic Flower" or
“OFIG” or the
“Company”) and
AgraFlora Organics International Inc. (CSE: AGRA) (FWB: PU31)
(OTCPK: PUFXF) (“
AgraFlora”) are
pleased to announce that Organic Flower and AgraFlora have entered
into a binding Letter of Intent (“
LOI”) whereby
Organic Flower shall sell and AgraFlora shall purchase 100 per cent
of Organic Flower’s assets, which includes: the Company’s 20%
interest in the Delta Greenhouse Complex, an array of domestic
downstream/product formulation operations and the rights to an
trans-European distribution network(the “
Proposed
Transaction”).
It is anticipated that the sale price for the
assets will be comprised of 1.15 shares of Agraflora for each one
(1) issued and outstanding share of OFIG at the time of closing
(the “Consideration Shares”), with the
Consideration Shares to be distributed to the shareholders of the
Company. Closing of the Proposed Transaction remains subject to
applicable corporate, securities and exchange approvals and/or
filings, as the case may be.
The Proposed Transaction will thereby reunite 70
per cent of the 2.2 million square foot Delta, BC greenhouse
complex (the “Delta Greenhouse Complex”), under
the AgraFlora corporate umbrella. The combined company’s interest
in 2020-funded production of the Delta Greenhouse Complex is
forecasted to be 175,000,000 grams of premium dried cannabis
flower.
AgraFlora’s Delta Greenhouse Complex is widely
considered to be one of the most technically-advanced and
environmentally-friendly greenhouse operations in the World, which
boasts 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 an optimized illumination
equilibrium
Brandon Boddy, Chairman, Chief Executive Officer
and a Director of AgraFlora stated: “This is a paradigmatic
transaction for AgraFlora, which will consistently amplify
long-term shareholder value as the combined entity continues to
execute on its corporate roadmap.
The reunification of the 2.2 million square foot
Delta Greenhouse Complex will create the critical mass needed in
today's evolving landscape for Canadian cannabis producers. The
combined entity will be equipped with world-class upstream
cultivation assets and diverse downstream capabilities that will
act as a beachhead into the 700 million person European
marketplace, as well as crystalize a distinctive first mover
advantage within the edibles, cannabinoid-infused beverage and
product formulation market verticals.
AgraFlora’s recently announced 100,000 kg
off-take agreement with ICC International Cannabis Corp. coupled
with Organic Flower’s revenue sharing and distribution arrangement
with ICC will allow the combined AgraFlora-Organic Flower entity to
capture significant cash flows at both the upstream and downstream
levels; realizing material exposure to both the wholesale and
eventual retail distribution of dried cannabis into high value
European territories.
AgraFlora’s Delta operations are set to emerge
as the World’s second largest cannabis cultivation operation under
glass, and coupled with Organic Flower’s unique portfolio of
downstream and product formulation assets will solidify a
first-mover trajectory into the second phase of cannabis
normalization.”
To date, Organic Flower has assembled a unique
portfolio of downstream and product formulation operations/assets
including:
CANDY, CHOCOLATE, EDIBLES
- Joint-Venture (“JV”) with one of North
America’s largest manufacturer and distributors of chocolate and
sugar confectionary products;
- Planned development of a
50,000-square-foot manufacturing and product formulation facility,
located in Winnipeg, Manitoba - fitted with industry-leading
manufacturing equipment capable of producing an assortment of both
cannabinoid/terpene-infused products for medicinal, functional and
adult use
- Forecasted to be fully operational
by the first quarter of 2020 and projected to generate in excess of
$750-million in annual sales revenue once optimized
- Operated by a roster of experienced
chocolatiers and confectioners
- Option to acquire 100% of JV
Partner
BEERS, CIDERS, ETC.
- Exclusive partnership with a leading Toronto-based Brewhouse
with planned output capacity of over 200,000 HL per annum, to
formulate, manufacture and distribute cannabinoid-infused
beverages;
- Brewhouse has completed multiple
production runs for prominent European beverage brands such as:
Guinness, Augustine, and Innes & Gunn
- Proprietary brewing processes and
associated technologies
- 24-head rotary canning line,
capable of packaging a variety of container dimensions at a rate of
over 100,000,000 containers per year
- Product formulation and batch
testing to commence Q2 of 2019, with forecasted commercial
production slated to begin in Q4 2019
COSMETICS
- Proposed acquisition of a Canadian CBD cosmetics/topicals
manufacturing company (Canutra Naturals Ltd), equipped with a
vertically integrated, farm-to-face model;
- 76 acres of un-zoned agricultural
land with 1,000 feet of river frontage in Kent County, New
Brunswick - 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
- Industrial hemp licence for its New
Brunswick land parcel in 2017
- Co-packing
agreements
- Whole Hemp Health brand sold by way
of brick-and-mortar retail outlets, Amazon Prime, as well as direct
to consumer, through an integrated Shopify e-commerce platform
- Cannabis research licence granted
by Health Canada in 2018
CBD-INFUSED PERFORMANCE
PRODUCTS
- Exclusive North American contract manufacturing and
distribution agreement with the world’s first professional sports
team to introduce its own branded CBD-infused product line;
- To produce 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
- Extraction-ready hemp inventories
will result in near-immediate access to superior CBD concentrates
and hemp oils
- Immediate access to the vast
captive audience of professional sports:
- International broadcast reach to over 140,000,000 homes
- Facebook Live game day audience of over 200,000 viewers (50,000
of viewers originating in the UK)
- Social media presence of over 100,000 verified followers
- THC-free, non-GMO, gluten free,
vegan and organic accreditations
BEVERAGES AND BOTTLING
- Exclusive cannabinoid-infused supply and distribution agreement
with a premier Canadian Bottler;
- Throughput of up to 30 million
bottles per year
- State-of-the-art bottling
equipment, configured to conduct rapid production runs, with
minimal downtime for production line changeovers
- Pharmaceutical-grade mixing
tanks
- Advanced UV sterilization
- Custom extended-shelf-life
bottling lines
UNIQUE DELIVERY SYSTEMS IP
- Sole Canadian manufacturer and distributor of an innovative
beverage dispensing cap technology, equipped with a proprietary
cannabinoid delivery mechanism;
- Certified for health care and
pharmaceutical applications
- Research and development
expenditures of $30-million
- Exclusive licensing agreement will
extend for an initial period of 10 years, option to extend the
exclusive licensing agreement for an additional successive 10-year
term
ACCESS TO THE EUROPEAN
MARKET
In addition, AgraFlora will inherit Organic
Flower’s European distribution and EU-GMP cannabis
processing/finishing agreement capabilities. Organic Flower’s
trans-European distribution network is comprised 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. The European distribution network is
augmented by various value-added services, including:
- Strategic procurement;
- Warehousing;
- Product registration; and,
- Regulatory representations
AgraFlora’s recently announced commercial rights
and off-take agreement with ICC International Cannabis Corp.
(WRLD.U)(8K51)(WLDCF) ("ICC" or “International
Cannabis”) is further complemented by Organic Flower’s
European downstream and EU-GMP cannabis processing capabilities.
Under the terms of the agreement, ICC may purchase up to
100,000,000 grams of premium dried cannabis flower from AgraFlora’s
Delta Greenhouse Complex cultivation operations, over a five-year
term.
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 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.
ABOUT ORGANIC FLOWER
INVESTMENTS
Organic Flower, an investment holding firm, is
leveraging strategic relationships, proprietary investments and
exclusive partnerships with preeminent international cannabis
cultivators and formulators for the development of best in class
products and brands to be marketed and distributed throughout our
global footprint.
ON BEHALF OF THE AGRAFLORA ORGANICS
INTERNATIONAL INC. AND ORGANIC FLOWER INVESTMENTS GROUP INC. BOARD
OF DIRECTORS
“Brandon Boddy”
Brandon Boddy Chairman & CEO
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 |
“Joel Dumaresq”Joel Dumaresq CEO, Director +1 (604)
336-3195info@sowcannabis.ca
Learn more about Organic Flower by visiting our website
at: https://sowcannabis.ca/
THE CSE HAS NOT REVIEWED AND DOES NOT ACCEPT
RESPONSIBILITY FOR THE ACCURACY OR ADEQUACY OF THIS RELEASE.
Notice Regarding Forward Looking
Information:
This news release contains certain
"forward-looking information" within the meaning of applicable
Canadian securities law. Forward-looking information is frequently
characterized by words such as "plan", "continue", "expect",
"project", "intend", "believe", "anticipate", "estimate", "may",
"will", "potential", "proposed" and other similar words, or
information that certain events or conditions "may" or "will"
occur. This information is only a prediction. Various assumptions
were used in drawing the conclusions or making the projections
contained in the forward-looking information throughout this news
release. Forward-looking information includes, but is not limited
to: political changes in Canada and internationally, future
legislative and regulatory developments involving cannabis in
Canada and internationally, AgraFlora’s ability to secure
distribution channels in international jurisdictions, competition
and other risks affecting the combined assets in particular and the
cannabis industry generally. Without limiting the generality of the
foregoing, the forward-looking statements herein relate to, among
other things, the ability of AgraFlora and Organic Flower to close
the Proposed Transaction on the terms generally set out in the LOI
and the development of the assets referenced in this news
release.
The forward-looking information contained in
this release is expressly qualified by the foregoing cautionary
statements and is made as of the date of this release. Except as
may be required by applicable securities laws, neither AgraFlora
nor Organic Flower undertake any obligation to publicly update or
revise any forward- looking information to reflect events or
circumstances after the date of this release or to reflect the
occurrence of unanticipated events, whether as a result of new
information, future events or results, or otherwise.
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