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AgriCann Solutions Enters into Binding Letter of Intent

The Product is proven in agricultural applications for dehydrating large volume produce crops and has undergone various independent verifications by U.S.-registered laboratories regarding the efficacy of the unique formulation used for cannabis and hemp. AgriCann recently completed its own independent verification testing at a Health Canada-licenced laboratory.

  • Reduces hanging dry-time to approximately 24 hours;
  • Retains cannabinoid and terpene profile;
  • Prevents mold, mildew, and pest cross-contamination;
  • Provides a shelf-life of 2+ years without degradation.
  • CHC grants ASC a perpetual, exclusive, royalty-free, fully paid-up licence to use, advertise, market, sell, and distribute the Product, a proprietary organic processing aid composed of FDA Generally Recognized as Safe (GRAS) approved organic ingredients, that reduces the drying and curing process of cannabis (collectively, the “Licence“);
  • The Licence is on a worldwide basis specifically excluding the United States of America which CHC retains. CHC will provide ASC with (and permit ASC to use) all technical data, know-how and trade secrets relating to the Product as held by CHC;
  • As consideration for the Licence, and as incentive to CHC to build value in the Product, ASC will issue to CHC a total of 23,152,718 common shares of ASC, subject to certain escrow, earnout and pooling conditions;
  • As a precondition to the closing, ASC proposes to raise CAD$2.4 million in Q1 2020 through the issue of 4.8 million common shares through a CAD$0.50 per Unit private placement, with each Unit consisting of one share and one-half of one Warrant. Each whole Warrant will entitle the holder to purchase one share at a price of CAD$0.75 for a period of 24 months following the Closing Date. The Warrants will be subject to an accelerated expiry should the shares trade at an average price greater than CAD$1.125 for ten (10) consecutive trading days on a stock exchange;
  • ASC will provide a total of US$1.0 million in cash payments (the “Post Closing Payments“) to CHC pursuant to a monthly payment schedule calling for twelve (12) equal payments and in accordance with a joint use of proceeds budget to be agreed between the parties. The purpose of the Post Closing Payments is for: (i) CHC’s overhead expenditures, including, but not limited to, salaries (ii) for CHC to purchase equipment and develop further systems for the application of the Product in order to enter into Product contracts, for the mutual and equal benefit of ASC and CHC. The Post Closing Payments will constitute revenue to CHC.
  • Closing is anticipated to occur on or prior to March 31, 2020 . There are no finder’s fees payable in connection with this transaction, which is arms length and subject to the customary conditions set out in a typical agreement for a proposed transaction of this type.
  • The Company is a “Reporting Issuer” that originated as one of three spinouts upon completion of a statutory plan of arrangement completed by The Valens Company (VLNS-TSXV) (formerly Valens GroWorks Corp.) on March 12, 2015 . The Company seeks to acquire a suitable business opportunity with potential for scalable near-term cash flow and sustainable growth to create shareholder value.

    CHC is a privately held company incorporated under the laws of the state of Wyoming, USA and is engaged in the business of worldwide marketing and distribution of Product to the cannabis industry worldwide in countries that legally permit the sale of cannabis and in the United States under applicable state law.

    Some of the statements contained in this press release are forward-looking statements and information within the meaning of applicable securities laws. Forward-looking statements and information can be identified by the use of words such as “expects”, “intends”, “is expected”, “potential”, “suggests” or variations of such words or phrases, or statements that certain actions, events or results “may”, “could”, “should”, “would”, “might” or “will” be taken, occur or be achieved. Forward-looking statements and information are not historical facts and are subject to a number of risks and uncertainties beyond the Company’s control. Actual results and developments are likely to differ, and may differ materially, from those expressed or implied by the forward-looking statements contained in this news release. Accordingly, readers should not place undue reliance on forward-looking statements. The Company undertakes no obligation to update publicly or otherwise revise any forward-looking statements, except as may be required by law. The Company will provide further updates respecting these initiatives as developments occur. There can be no assurance that interests in any or all of these or additional projects being pursued will be acquired, funded and/or commercialized.

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