(TheNewswire)
V ancouver - February 24, 2021 - TheNewswire - CANNAMERICA BRANDS CORP.("CannAmerica Brands" or the "Company")(C NSX :CANA. CN ) (OTC:CNNXF) is pleased to announce that on February 22, 2021, it hadentered into a non-binding letter of intent (“LOI”) for thepurchase of its Colorado licensee, Arsenal Oils and Extracts("Arsenal").
The Company has entered into a non-binding LOI withArsenal Extracts to purchase 100% of the membership interests andassets of Arsenal for aggregate consideration, including performanceincentives, of USD $2,000,000. Arsenal is expected to provide theCompany with existing extraction contracts for wholesale customers ofdistillate and other cannabis oils. The current facility has thecapacity to produce up to 10,000 liters of cannabis distillates peryear, which the Company intends to utilize for expanding its brandedlineup of products in Colorado, as well as wholesale bulk oil sales.
Arsenal has multiple brands of vaporizer cartridges,including Anointed and Lo-Hi, with current sales exceeding $1millionper year into retailers across the state. The Company intends tocontinue the sales of Arsenal’s branded products and introduce itsown additional brand of concentrate products called LiveLabs into theColorado marketplace with the goal of increasing both its productlines and revenues in the state of Colorado.
The existing management team at Arsenal consists ofhighly experienced operators that are expected to continue to managethe extraction facilities and sales and distribution across Colorado.The Company expects to expand into larger space to accommodate themultiple brands and product lines that will be produced by combiningthe two companies. The Arsenal team includes:
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- Rainbow Coleman, Co-Founder and CEO, specializes inthe operations and setup of multiple platforms of extraction andtechniques. Mr. Coleman manages the production of oils, refinement,and the production of products manufactured and distributed from theArsenal facility.
- Adam Carson, Co-Founder and COO, specializes in themarketing, sales, and distribution of products across Colorado.
Subject to Board approval, stock exchange approval andcompletion of satisfactory due diligence, the Company intends to enterinto a definitive purchase agreement on or before April 23, 2021.Consideration for the acquisition consists of:
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- 100% asset purchase of the Seller for $2,000,000 in astructured purchase combination of 70% in shares and 30% incash.
- Existing management will remain in place.
- All licenses, leases, infrastructure, assets, brands,and distribution are included.
Founded in 2016 in Colorado, Arsenal is ablack-veteran-owned licensed cannabis manufacturer of infusedproducts. The company currently produces wholesale cannabis oils andfilled cannabis cartridges for sale and distribution into licensedcannabis retail under the brands of Lo-Hi and Anointed. In 2020,Arsenal entered into a licensing agreement with CannAmerica BrandsCorp to produce its line of edible products for statewide wholesaledistribution, with projected sales of $1.5 million in additionalrevenue based on current production space and capacity.
Dan Anglin, founder and CEO of CannAmerica Brands,stated “The Company is excited to be bringing the expertise of themanagement of Arsenal Oils and Extracts into the Company as we expandour business model into direct operations across the country. TheCompany is well positioned to manage the expansion of the operationsof a Colorado manufacturing business and position the brands under itscontrol into market leaders in the state. In the last six months,management and the Board of Directors reviewed the current businessmodel of royalty licensing with operators in multiple markets andcreated a new strategy to expand the Company’s assets into directownership of operations of its licensing partners for increasing its revenue streams while also focusing onincreasing the direct management of the operations for expansion inthe market.”
Anglin continued: “The Company is now laser focusedon building the brands in existing and future markets through thedirect operational management of businesses like Arsenal’s to expandthe number brands under its control. The timing is right for a shiftof focus from a low-overhead supply chain and marketing strategy to anoperational strategy of managing the business directly for increasedopportunities.”
For a more complete business and financial profile ofthe Company, please view the Company's website at www.cannamericabrands.com and documents posted under the Company’sprofile on www.sedar.com .
For further information please contact the Company atinfo@cannamericabrands.com.
On Behalf of the Board,
Dan Anglin
CEO and Director
www.cannamericaco.com
www.cannamericabrands.com
1(607) 769-7870
About CannAmerica Brands Corp.
CannAmerica is a U.S. Marine Corps veteran founded andoperated portfolio of cannabis brands with licensing agreements in thestates of Colorado, Nevada, Oklahoma , Massachusetts and the Countryof Canada. The Company aims to maximize the value of its brands byemploying strong brand management teams, marketing and licensing thebrands through various distribution channels, including dispensaries,wholesalers and distributors, in the United States andinternationally. The Company's core strategy is to enhance andmonetize the global reach of its existing brands, and to pursueadditional strategic acquisitions to grow the scope and diversity ofits brand portfolio. For more information, please visit www.cannamericabrands.com .
Neither the Canadian SecuritiesExchange nor its Regulation Services Provider (as that term is definedin the policies of the Canadian Securities Exchange) acceptsresponsibility for the adequacy or accuracy of this release.
Forward-LookingStatements
This news releasecontains "forward-looking information" within the meaning ofapplicable securities laws. All statements contained herein that arenot clearly historical in nature may constitute forward-lookinginformation. In some cases, forward-looking information can beidentified by words or phrases such as "may","will", "expect", "likely","should", "would", "plan","anticipate", "intend", "potential","proposed", "estimate", "believe" or thenegative of these terms, or other similar words, expressions andgrammatical variations thereof, or statements that certain events orconditions "may" or "will" happen, or bydiscussions of strategy.
Readers are cautionedto consider these and other factors, uncertainties and potentialevents carefully and not to put undue reliance on forward-lookinginformation. The forward-looking information contained herein is madeas of the date of this press release and is based on the beliefs,estimates, expectations and opinions of management on the date suchforward-looking information is made. The Company undertakes noobligation to update or revise any forward-looking information,whether as a result of new information, estimates or opinions, futureevents or results or otherwise or to explain any material differencebetween subsequent actual events and such forward-looking information,except as required by applicable law.
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