SugarBud Craft Growers Corp. (“
SugarBud” or the
“
Company”) (trading as Relentless Resources Ltd.)
is pleased to provide an operations update regarding its
state-of-the-art vertical cannabis cultivation facility at Stavely,
Alberta (the “
Facility”). The Company is also
pleased to announce that it has filed a filing statement (the
“
Filing Statement”) under SugarBud’s profile on
SEDAR at www.sedar.com with respect to the Company’s planned
“Change of Business” pursuant to the policies of the TSX Venture
Exchange (“
TSXV”).
Vertical Aeroponic Cannabis Cultivation
Facility at Stavely, Alberta
SugarBud is pleased to announce that Phase 1 of
the Facility has been erected by ConstructShieldTM, with direct
assistance from Gunther’s Masonry Construction Ltd. Construction is
currently underway on the interior of the building, including the
inner walls, electrical, mechanical, plumbing and other components
of the Facility. See Exhibits 1 and 2 for pictures of Phase 1 and
Exhibit 3 for a drone video of Phase 1.
Exhibit
1: http://www.globenewswire.com/NewsRoom/AttachmentNg/8b24e6ea-8736-41c9-9f5a-40c2ad0a9ce7
Exhibit
2: http://www.globenewswire.com/NewsRoom/AttachmentNg/deb98546-930f-453d-a334-f33f1a5a4ae0
Exhibit 3 – Drone Video of the ConstructShieldTM
Facility: https://www.youtube.com/watch?v=kJ2UIxedvxk
Upon completion of the interior, Phase 1 of the
Facility will be comprised of an administrative and service area, a
nursery, and eight 2,200 square foot flowering rooms. Each
flowering room will have isolated HVAC and environmental controls,
allowing SugarBud to “fine-tune” the temperature, humidity and
air-circulation for each room, with the intent of maximizing
product quality on a strain-by-strain basis, and limiting the
impact of any potential pest or pathogen infestations.
Targeted Timing of
Cultivation
SugarBud is working diligently to equip the
first growing room (“Phase 1A”) by the end of
calendar 2018. Subject to the receipt of cultivation license from
Health Canada, SugarBud will then commence the cultivation of
cannabis with the intent of obtaining a sales license
(“Sales License”) under Health Canada’s Access to
Cannabis for Medical Purposes Regulations (ACMPR), and/or other
Cannabis Regulations, as soon as possible thereafter.
In order to accelerate the receipt of a Sales
License, the Company will equip the seven remaining Phase 1
flowering rooms (“Phase 1B”) concurrently with the
production of cannabis in Phase 1A. The Company is targeting to
obtain its Sales License and the completion of all eight Phase 1
flowering rooms by mid-2019.
The Company will commence construction of Phase
2 when capital permits. It is expected that the Company will have
the capital required to fully-construct Phase 2 upon the
syndication and finalization of the previously announced $17.65
million credit facility (“Credit Facility”) with
Farm Credit Canada (“FCC”). The Company is
currently in negotiations with a Canadian financial institution
regarding the syndication of the Credit Facility.
Phase 2 consists of two “wings” constructed on
the side of Phase 1. See Exhibit 4 for an illustration of the Phase
2 “wings” in relation to Phase 1.
Exhibit
4: http://www.globenewswire.com/NewsRoom/AttachmentNg/b213fce0-9ce4-487f-8462-671ccf9f8f87
While the final design of the Facility is
subject to change, the planned specification of Phases 1 & 2 is
as follows:
| Phase (#) |
Layers of Flowering Canopy
(#) |
Flowering Canopy (Square
Feet) |
Estimated Capital Cost
(Millions) |
Estimated Annual Dried Cannabis
Flower Production (Kgs) |
| 1 |
3 |
~27,000 |
~$15.3 |
~9,000 |
| 2 |
3 |
~43,200 |
~$19.6 |
~14,200 |
| Total |
3 |
~70,200 |
~$34.9 |
~23,200 |
SugarBud anticipates being able to achieve the
strong production metrics noted above due to the utilization of
aeroponics and vertical growing technology.
Aeroponics
In order to maximize control of the growing
environment, root formation, and ultimately enhance cannabinoids,
trichome production, terpene profiles and yield, the Company will
utilize an aeroponics growing system (the “Aeroponics
System”). It is anticipated that the Aeroponics System
will reduce water usage, increase nutrient uptake, accelerate the
vegetation and flowering cycles and optimize the number of crops
harvested per year. See Exhibit 5 for an illustration of cannabis
roots grown in an aeroponic environment.
Exhibit
5: http://www.globenewswire.com/NewsRoom/AttachmentNg/ef0430f4-5295-432e-ad21-0ab42cfd5b8d
Vertical Growing Technology
In order to maximize the utilization of the
Facility’s floorplate, and the efficiency of the capital deployed,
SugarBud is utilizing vertical growing technology. It is
anticipated that SugarBud will achieve a flowering floorplate to
flowering canopy ratio in excess of 160% using vertical racking
with three layers. Please see Exhibit 6 for an illustration of the
vertical racking system to be employed by SugarBud. Note that
Exhibit 6 illustrates vertical racking with soil as opposed to
SugarBud’s planned aeroponics system.
Exhibit
6: http://www.globenewswire.com/NewsRoom/AttachmentNg/e48abd52-939a-4eb5-956a-27d2a2811980
Filing Statement
SugarBud is pleased to announce that it has
filed the Filing Statement in respect of its previously announced
“Change of Business” pursuant to the policies of the TSXV. It is
expected that the Company will achieve final approval of “Change of
Business” from the TSXV on or about October 17, 2018 (the
“Expected Final Approval Date”). Upon receiving
final approval of “Change of Business”, SugarBud will proceed to
close a series of transactions (the
“Transactions”) that constitute the “Change of
Business”.
The Transactions include, without limitation:
(i) the completion of its rights offering to holders
(“Shareholders”) of common shares of SugarBud
(“Common Shares”), the results of which were
announced on September 20, 2018; (ii) the acquisition (the
“Acquisition”) of Grunewahl Organics Inc.
(“Grunewahl”); (iii) the second tranche of a
strategic investment with Inner Spirit Holdings Ltd.
(“Inner Spirit”); (iv) the
entering into of a strategic alliance agreement with Inner Spirit
that will govern the on-going business relationship of the parties;
(v) the appointment of Darren Bondar, Chief Executive Officer
of Inner Spirit, as a director of SugarBud; (vi) the name change to
SugarBud; and (vii) the change of SugarBud’s stock ticker from
“RRL” to “SUGR”, each as is described in the Filing Statement.
Closing of the Transactions is subject to a
number of conditions (“Conditions”) including, but
not limited to: final TSXV approval of the Change of Business;
approval of the Transactions by greater than 50.1% of Shareholders
by written consent; and closing conditions customary to
transactions of the nature of the Transactions, including those
described in the Filing Statement. SugarBud believes that the
Conditions will be met prior to the Expected Final Approval Date.
Upon completion of the Transactions, the Company will be listed on
the TSXV as a Tier 2 Life Sciences Issuer.
In connection with preparation of the Filing
Statement, the unaudited condensed consolidated financial
statements of the Company for the three and six month period ended
June 30, 2018 have been reviewed by an independent auditor.
Concurrent with the filing of the Filing Statement, the financial
statements were refiled on SEDAR at www.sedar.com to exclude the
original disclaimer indicating the financial statements had not
been reviewed by an auditor.
About SugarBud Craft Growers
Corp.
SugarBud is a Calgary based emerging cannabis
and oil and natural gas company engaged in the development,
acquisition and production of cannabis and natural gas and crude
oil reserves in Alberta.
For further information regarding this news
release, please contact:
| Craig Kolochuk |
Jeff Swainson |
| President & Chief Executive
Officer |
Chief Financial Officer |
| SugarBud Craft Growers Corp. |
SugarBud Craft Growers Corp. |
| Phone: (403) 875-5665 |
Phone: (403) 796-3640 |
| E-mail:
craigk@sugarbud.ca |
E-mail:
jeffs@sugarbud.ca |
Investor Relations ContactGary
Perkins, PresidentTekkfund Capital Corp.Tel: (416) 882-0020E-mail:
garyperkins@rogers.com
Website: http://www.sugarbud.ca/
Address: Suite 620, 634 ‐ 6th Avenue S.W.,
Calgary, Alberta T2P 0S4
Telephone: 403‐532‐4466Fax: 587‐955‐9668
Reader Advisory
Completion of the Transactions is subject to a number of
conditions, including but not limited to, final TSXV
acceptance. There can be no assurance that the Transactions
will be completed as proposed or at all.
Investors are cautioned that, except as disclosed in the Filing
Statement, any information released or received with respect to the
Transactions may not be accurate or complete and should not be
relied upon. Trading in the securities of SugarBud should be
considered highly speculative.
The TSXV has in no way passed upon the merits of the
Transactions and has neither approved nor disapproved of the
contents of this news release.
Neither the TSXV nor its regulation services provider
(as that term is defined in the policies of the TSXV) accepts
responsibility for the adequacy or accuracy of this
release.
Forward Looking and Cautionary Statements
This news release may include forward-looking statements
including opinions, assumptions, estimates, the Company’s
assessment of future plans and operations, and, more particularly,
statements concerning the completion of Phase 1A of the Facility;
the quality and yield of cannabis to be grown in the Facility,
including pursuant to the Aeroponics System and vertical growing
technology; the construction of Phases 1B and 2 of the Facility;
potential sources of funding of Phase 2, including advances under
the Credit Facility; the completion of the Transactions; and the
trading in the Common Shares under the new name and new symbol.
When used in this document, the words “will,” “anticipate,”
“believe,” “estimate,” “expect,” “intent,” “may,” “project,”
“should,” and similar expressions are intended to be among the
statements that identify forward-looking statements. The
forward-looking statements are founded on the basis of expectations
and assumptions made by the Company which include, but are not
limited to, the timely receipt of all required securityholder, TSXV
and regulatory approvals and the satisfaction of other closing
conditions in accordance with the terms of the amalgamation
agreement entered into between SugarBud and Grunewahl and the
investment agreement entered into between SugarBud and Inner
Spirit. Forward-looking statements are subject to a wide range of
risks and uncertainties, and although the Company believes that the
expectations represented by such forward-looking statements are
reasonable, there can be no assurance that such expectations will
be realized. Any number of important factors could cause actual
results to differ materially from those in the forward-looking
statements including, but not limited to: regulatory and third
party approvals, including receipt of cultivation and sales
licenses from Health Canada, not being obtained in the manner or
timing anticipated; the ability to implement corporate strategies;
the state of domestic capital markets; the ability to obtain
financing; changes in general market conditions; industry
conditions and events; the size of the medical marijuana market and
the recreational marijuana market; government regulations,
including future legislative and regulatory developments involving
medical and recreational marijuana; construction delays;
competition from other industry participants; and other factors
more fully described from time to time in the reports and filings
made by the Company with securities regulatory authorities. Please
refer to the Filing Statement for additional risk factors relating
to the Company. The Filing Statement is accessible under the
Company’s profile on www.sedar.com.
Except as required by applicable laws, the Company does not
undertake any obligation to publicly update or revise any
forward-looking statements.
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