AgriFORCE Signs Definitive Contract to Deploy Its Proprietary Grow House Facility and IP in Barbados for Production of High Value Medical and Agricultural Crops
December 02 2021 - 8:45AM
AgriFORCE Growing Systems Ltd.
(“the Company") (NASDAQ:
AGRI; AGRIW), an Intellectual Property (IP) -focused
AgTech company dedicated to advancing sustainable cultivation and
crop processing across multiple platforms, has signed a definitive
contract with Humboldt Bliss, Ltd. (“Humboldt”), an agriculture and
aquaculture business based in Barbados, West Indies. The contract
is for the deployment of the AgriFORCE foundational IP – which
includes a proprietary facility design, production and operation
technologies and methods, and an automated growing system (the
AgriFORCE “Grow House”) for the cultivation and sale of high value
medical and agricultural products into the Caribbean and global
pharmaceutical and agricultural markets.
Under the terms of the contract, AgriFORCE is
responsible for constructing its proprietary facility and providing
the full Standard Operating Procedures (SOPs) of the AgriFORCE Grow
House and Humboldt is responsible for securing the project’s land
as well as operating the facility. Upon production, Humboldt has
committed to remit an IP licensing, management services and
equipment leasing fee to AgriFORCE for up to 14,300 pounds (6,500
kgs) of high value medical and agricultural crops per year. Based
on AgriFORCE’s internal financial modelling and current market
index pricing, the Company believes that the contract represents
$12.7M of annual recurring EBITDA.1 As the initial contract is for
a five-year-term, the Company believes this represents more than
$63M in EBITDA1 over the initial term and with two five-year
automatic renewals, it anticipates the total contract EBITDA1 could
be up to approximately $190 million. The contract will be backed by
a rolling $5 million performance bond maintained by Humboldt.
AgriFORCE CEO Ingo Mueller stated: “Finalizing
this agreement is exciting, and we are looking forward to deploying
our Grow House facility in Barbados. We believe that this facility
may generate over $12 million of EBITDA1 per year based on current
contracts with the potential to further expand production based
upon up to a further 50% of available installed capacity. Moreover,
we have a robust sales pipeline and we believe this is only the
first of several agreements to roll out our Grow House facilities
in the coming months.” He continued: “Like many Caribbean
countries, Barbados has a challenging tropical climate and unique
soil conditions that make some areas of agriculture such as high
value medical and agricultural products a real hurdle to overcome.
Our proprietary facility design and automated growing system and
methods addresses these issues and provides the ability to grow a
range of crops that would be too difficult to grow otherwise.”
The AgriFORCE team sees this finalized agreement
as an exceptional opportunity to showcase their IP and to help to
create high paying and technical jobs for the people of Barbados,
contributing to the country’s economic future. Said Mueller: “We
anticipate that along with creating significant cashflow for the
Company, this contract will lead other Caribbean countries and
countries with tropical climates to appreciate the value of our IP
and how we can help contribute to their economies, employment
markets and, of course, help to advance agriculture in their
regions.”
“The opportunity to use the AgriFORCE IP to grow
crops in a sustainable and profitable way in a challenging climate
is exciting for the Humboldt team,” says Robin P. Cho, Director
from Humboldt. “With the AgriFORCE business model, we are confident
that we will quickly produce a strong revenue stream that will
contribute directly to the Company’s bottom-line as well as to the
country’s domestic and export market. It is a major achievement for
everyone involved, especially for Bliss and Barbados.”
- All EBITDA information provided in
this press release is merely management's belief as to possible
future results. These numbers are not intended as projections and
are not intended as an indicator or guarantee of future
performance.
|
|
Annual |
|
Initial term (5 years) |
|
Total |
|
|
|
(in US$ ‘000’s) |
|
|
(in US$ ‘000’s) |
|
|
(in US$ ‘000’s) |
|
Net income |
|
3,250 |
|
|
16,000 |
|
|
49,000 |
|
Depreciation and
Amortization |
|
3,200 |
|
|
16,000 |
|
|
48,000 |
|
Interest expense |
|
5,000 |
|
|
25,000 |
|
|
75,000 |
|
Income tax expense |
|
1,250 |
|
|
6,000 |
|
|
18,500 |
|
EBITDA |
|
12,700 |
|
|
63,000 |
|
|
190,500 |
|
About HumboldtHumboldt is an
agriculture and aquaculture business based in Barbados, West Indies
with deep roots and ties into the Barbadian business landscape.
Through its subsidiaries, Humboldt has applied for licensure and
entered into various licensing deals, leases, and partnerships in
North America and the Caribbean to sell, distribute and cultivate
high value medical and agricultural products for Caribbean markets.
Humboldt has also entered licensing and partnership deals with a
United States based multi-state dispensary operator; Cannabis
Global Inc. (OTC: CBGL), a publicly traded company focused on
multiple growing verticals within the global cannabis & CBD
industry; as well as Honey Vape, a multi-state e-pen manufacturer,
to work in partnership in expansion throughout the Caribbean and
South America.
About AgriFORCEDedicated
to providing more sustainable and better quality food, plant-based
products and ingredients, pharmaceuticals and nutraceuticals,
AgriFORCE Growing Systems Ltd. (NASDAQ: AGRI; AGRIW) is an
AgTech company focused on developing and acquiring innovative
agriculture IP that changes the way cultivation and crop processing
are done. The Company’s vision is to be a leader in delivering
plant-based foods and products through advanced and sustainable
AgTech solution platforms that make positive change in the world –
from seed to table. The AgriFORCE foundational IP – called the
AgriFORCE Grow House – includes a proprietary facility design and
automated growing system for high-value crops focused on improving
the way that controlled-environment agriculture (CEA) is done. The
AgriFORCE Grow House was designed to produce in virtually any
environmental condition and to optimize crop yields to as near
their full genetic potential possible, while using substantially
fewer natural resources and eliminating the need for the use of
pesticides and/or irradiation. The AgriFORCE goal: Clean. Green.
Better. Additional information about AgriFORCE is available at:
www.agriforcegs.com.
Follow AgriFORCE on Twitter: @agriforcegsFollow
AgriFORCE on Facebook: AgriFORCE Growing Systems Ltd.
This press release contains forward-looking
statements within the meaning of the "safe harbor" provisions of
the Private Securities Litigation Reform Act of 1995. Statements
other than statements of historical facts included in this press
release may constitute forward-looking statements and are not
guarantees of future performance, condition or results and involve
a number of risks and uncertainties. Actual results may differ
materially from those in the forward-looking statements as a result
of a number of factors, including those described from time to time
in our filings with the Securities and Exchange Commission and
elsewhere. The Company undertakes no duty to update any
forward-looking statement made herein. All forward-looking
statements speak only as of the date of this press release.
Company Contact:Ian PedersenTel: (604)
757-0952Email: ipedersen@agriforcegs.com
Investor Relations:Crescendo Communications,
LLCDavid Waldman/Natalya RudmanTel: (212) 671-1021Email:
AGRI@crescendo-ir.com
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