HCANF - Bophelo Bioscience Grows Premium DNA Genetics California-Style Cannabis in Lesotho with GACP on the Way

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TORONTO , May 21, 2021 /CNW/ - Halo Collective Inc.'s (" Halo " or the " Company ") (NEO: HALO) (OTCQX: HCANF) (Germany: A9KN) wholly-owned subsidiary Bophelo Bioscience & Wellness (Pty) Ltd. (" Bophelo ") is partnering with OG DNA Genetics Inc. (" DNA Genetics " or " DNA ") to grow premium California-style cannabis in Lesotho . Bopehlo operates a 200-hectare cannabis cultivation site near Mafeteng, the first Special Economic Zone ("SEZ") in Lesotho, Africa. ¹ DNA Genetics is one of the world's leading creators of high-quality cannabis seeds, whose strains consistently contain high cannabinoid and terpene concentrations. Bophelo and DNA entered a seed purchase agreement giving Bophelo exclusive rights to develop new and existing strains of DNA medical cannabis in Lesotho for export worldwide.

Harvest Update

Bophelo finalized the summer harvest with more than 400,000 grams of sellable flower. Despite difficult growing conditions this season due to eight weeks of unusual weather, strong results were achieved with eight strains providing over 20% of THC A in line with the highest quality sun-grown cannabis found in Oregon and California .

Current test results from ISO laboratory testing are shown below:

This marks a significant milestone in quality, as 20% and higher is the desired standard in most medical markets.  Strains above 25% are considered the highest quality for natural sun-grown cannabis. Additional strains await test results with the anticipation that more strains that will test over 20%. Each of these strains has been selected as a "Production Strain" and will be a large section of our spring planting beginning in October.

The success of the DNA strains in the Lesotho environment has yielded  high quality cannabis that would be expected to sell at a premium price. The DNA Genetics team plans to visit Bophelo's cultivation site  in late June or early July to establish more unique strains potentially by crossing local genetics to make a new class of African-California cannabis strains as part of the Halo and Bophelo partnership.

Aaron Yarkoni , Co-Founder of DNA Genetics said, "We're excited about all the progress we have made in Africa with Halo. We have grown all over the world, and this is the first time I have seen both the Prime Minister with his cabinet visit the site. It's an honor to participate in creating a Special Economic Zone, creating jobs, and most of all, providing our highest quality cannabis strain varieties to people all over the world. The team in Lesotho has been doing an incredible job with our genetics, and we're proud to show the world what we've achieved. It's been a great partnership."

"The cannabis we are growing would be top-shelf sun-grown cannabis. Our cost of production is among the lowest in the world, and our quality is among the highest, as independent lab test results demonstrate. I am excited to scale this year and then next and start bringing strong revenue with high margins with the cannabis that all medicinal cannabis patients will demand," said Kiran Sidhu , CEO and Co-Founder of Halo.

Sales Opportunities

Bophelo continues to work on the export process in Lesotho and the import process in South Africa to allow independent third-party compliance product testing. The result will enable Bophelo to sell products abroad through third parties exporters and resellers.

Interested third parties have been identified, and Bophelo expects to make initial sample product sales abroad as soon as the protocols are firmly established. It is anticipated that these protocols will be completed by late July.

GACP Certification Targeted for June

With the outer 1.6 km of fence complete, work is now beginning on the inner fence. These two elements significantly increase the security of the site—a significant accomplishment. The inner fence should be completed by June. The ablutions continue to progress with the roof to be installed and inner finish work expected to be completed within four weeks. Proper curing, storage, and post-harvest processing facilities are the longest lead time items and can possibly be done in late June. The state-of-the-art security system and corporate headquarters are already finished.

Cravo Green Houses Starting to Arrive

Work has been completed to supply electricity sufficient to power 1 acre (0.4 hectares) of greenhouse space—a major accomplishment. Planning is in process to build out the electrical infrastructure in preparation to start foundation work, which is expected to be completed by the middle of July. Bophelo plans to use high-quality systems, including EPHOS® lighting systems.

Despite numerous delays due primarily to Covid-19, the first container of Cravo parts is expected to be on time and arrive in South Africa by the end of June. This shipment contains the foundation for the greenhouse. Plans to build out the drainage and foundation are being finalized with the expectation to pour concrete starting in late July and early August. The goal is to begin planting in this first greenhouse by October. Once this prototype proves successful, Bophelo plans to implement a total of 15 acres of Cravo Greenhouses by the middle of 2023, capable of producing up to 48 million grams of flower annually, which is expected to  be one of the largest greenhouse complexes in the world.

Extraction Will Soon Be Up and Running

The 16 m ² extraction facility is almost complete, with initial extractions expected to begin in June. The first month of extraction will be focused on learning standard operating procedures to ensure safe extractions. Bophelo will utilize the "B" buds from its cultivation along with cannabis procured from other license holders. Shatter and oil will be produced for sale within Africa to additional medical licenses. If possible, the oil will be exported out of Africa as well.

Covid-19 Mitigation Strategy in Place

Management at Bophelo anticipated the possibility of a third wave of Covid-19 and prepared a contingency grow plan to allow the expansion of an additional two acres (0.8 hectares) of grow space. This would increase Bophelo's conventional greenhouse space at a minimum from 0.7 acres (0.3 hectares) to 2.7 acres (1.1 hectares) even in the event of a total lockdown due to Covid-19. This canopy would be in addition to the planned Cravo Greenhouses.  Bophelo expects to have at least 6 acres of canopy growing by May 2022 , as much as Halo's East Evan's Creek Facility with equal or better quality but at a significantly lower cost and contributing to Halo's gross margin .

"Covid had a significant impact on Bophelo's ability to expand in 2021. We built the team and grew despite the challenges as well as learned some valuable lessons. We are a few weeks late on GACP certification but aim to be certified in July. We are well-positioned to continue growing and thriving at a fast pace," said Andreas Met, Managing Director of Bophelo and Halo Co-Founder.

About Halo Collective Inc.

Halo is a leading, vertically integrated cannabis company that cultivates, extracts, manufactures, and distributes quality cannabis flower, oils, and concentrates and has sold approximately nine million grams of oils and concentrates since inception. Halo continues to evolve its business and scale efficiently, partnering with trustworthy leaders in the industry, who value the Company's operational expertise in bringing top-tier products to market. Current growth includes expansion in key U.S. markets, the United Kingdom and Africa , with planned expansion into the Canadian retail market.
Halo is led by a strong, diverse, and innovative management team with deep industry knowledge and blue-chip experience. The Company is currently operating in the United States in California and Oregon . The Company sells cannabis products principally to dispensaries under its brands, Hush, Mojave , and Exhale, and under partnership or license with OG DNA Genetics, Terphogz and FlowerShop*, a cannabis lifestyle and conceptual wellness brand in which G-Eazy is a partner and key member of FlowerShop*.

As part of continued expansion and vertical integration in the U.S., Halo boasts several grow operations throughout Oregon and California . In Oregon , the Company has a combined 9 acres of outdoor cultivation, including East Evans Creek, a six-acre grow site in Jackson County , Blue Sky Farms, a two-acre grow site located in Jackson County and Winberry Farms, a one-acre grow site located 30 miles outside Eugene in Lane County . In California , the Company is building out Ukiah Ventures, a planned 30,000-square-foot indoor grow and cannabis processing facility, including up to an additional five acres of industrial land to expand this indoor grow site. Recently, Halo partnered with Green Matter Holding to purchase Bar X Farm in Lake County , developing up to 80 acres of cultivation which would comprise the largest grow in California .

Internationally, the Company's subsidiary Bophelo is currently cultivating medicinal cannabis in Lesotho.  Once fully built out, Halo believes Bophelo to be one of the largest licensed marijuana cultivation sites in the world with a future capacity of up to 495 acres. To further Halo's global presence, the Company has recently acquired CBPM importation and distribution licensing in the United Kingdom via medical cannabis suppliers Canmart. Halo expects the cultivation and manufacturing operations of Bophelo, combined with the importation and distribution capabilities of Canmart, to drive a well-positioned business to serve the U.K. market.

The Company also has acquired a range of software development assets, including technology platforms CannPOS, Cannalift, and, more recently, CannaFeels. Halo also owns the discrete sublingual dosing technology, Accudab. The Company intends to spin-off these assets along with its intellectual property and patent applications into its subsidiary Halo Tek Inc. and complete a distribution to shareholders on a record date to be determined by Halo.

For further information regarding Halo, see Halo's disclosure documents on SEDAR at www.sedar.com

Connect with Halo Collective: Email | Website | LinkedIn | Twitter | Instagram

About OG DNA Genetics Inc.

DNA was rooted in Los Angeles and founded in Amsterdam in 2004 by Don Morris and Aaron Yarkoni .  Over the last decade, the Company has built and curated a seasoned genetic library and developed proven standard operating procedures for genetic selection, breeding, and cultivation. In a world that is increasingly opening up to commercial cannabis activity, DNA is positioned to become the first, truly geographically diversified company with multiple partnerships with top-licensed producers and brands that have built their companies and global presence utilizing the "Powered by DNA" model.

For more information, please visit www.dnagenetics.com

About Bophelo

Bophelo is based in the Kingdom of Lesotho , Southern Africa , and is the holder of one of a limited number of licenses issued in Lesotho for the production of medicinal cannabis products. Situated 70 kilometers from the capital city of Maseru , Bophelo's operating site is an ideal location with ample labor, free water, flat land area, and low crime rates. The favorable high altitude and low humidity climate provide clean and organic growing conditions within the mountainous region. With the motto "Sechaba se tlisa lerou" translated in English, meaning community brings wealth, Bophelo highlights the value of community and empowerment of the Basotho people, focusing on the development of women and youth. Bophelo is an indirect, wholly owned subsidiary of Halo.

For more information about Bophelo, please visit www.bophelo-bioscience.com

Cautionary Note Regarding Forward-Looking Information and Statements

This press release contains certain "forward-looking information" within the meaning of applicable Canadian securities legislation and may also contain statements that may constitute "forward-looking statements" within the meaning of the safe harbor provisions of the United States Private Securities Litigation Reform Act of 1995. Such forward-looking information and forward-looking statements are not representative of historical facts or information or current condition, but instead represent only Halo's beliefs regarding future events, plans or objectives, many of which, by their nature, are inherently uncertain and outside of Halo's control. Generally, such forward-looking information or forward-looking statements can be identified by the use of forward-looking terminology such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or may contain statements that certain actions, events or results "may", "could", "would", "might" or "will be taken", "will continue", "will occur" or "will be achieved". Forward-looking information may relate to anticipated events or results including, but not limited to the development and expansion of Bophelo's operations and the granting of certifications, Bophelo's prospects, including with respect to the distribution of cannabis products  produced by Bophelo, Halo's planned expansion into the Canadian retail market, the expected size and capabilities of the final facility planned at Ukiah Ventures, the size of Halo's planned cultivation facility in Northern California and the ability of Bophelo and Canmart to serve the E.U., U.K. and Australian market.

By identifying such information and statements in this manner, Halo is alerting the reader that such information and statements are subject to known and unknown risks, uncertainties and other factors that may cause the actual results to be materially different from those expressed or implied by such information and statements. In addition, in connection with the forward-looking information and forward-looking statements contained in this press release, Halo has made certain assumptions. Although Halo believes that the assumptions and factors used in preparing, and the expectations contained in, the forward-looking information and statements are reasonable, undue reliance should not be placed on such information and statements, and no assurance or guarantee can be given that such forward-looking information and statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information and statements. Among others, the key factors that could cause actual results to differ materially from those projected in the forward-looking information and statements are the following: unforeseen delays or circumstances that prevent the applicable stock exchanges from commencing trading in the Company's shares or warrants; delays in obtaining required licenses or approvals, delays or unforeseen costs incurred in connection with construction, the ability of competitors to scale operations in Northern California, delays or unforeseen difficulties in connection with the cultivation and harvest of Halo's raw material, changes in general economic, business and political conditions, including changes in the financial markets; and the other risks disclosed in the Company's annual information form dated March 31, 2021 and other disclosure documents available on the Company's profile at www.sedar.com .  Should one or more of these risks, uncertainties or other factors materialize, or should assumptions underlying the forward-looking information or statements prove incorrect, actual results may vary materially from those described herein as intended, planned, anticipated, believed, estimated or expected.

The forward-looking information and forward-looking statements contained in this press release are made as of the date of this press release, and Halo does not undertake to update any forward-looking information and/or forward-looking statements that are contained or referenced herein, except in accordance with applicable securities laws. All subsequent written and oral forward-looking information and statements attributable to Halo or persons acting on its behalf is expressly qualified in its entirety by this notice.

SOURCE Halo Collective Inc.

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