CALGARY, AB / ACCESSWIRE / November 12, 2018 / International Cannabrands Inc. (CSE: JUJU) (the "Company") shared CEO Steve Gormley's letter to Shareholders.
Dear Shareholders,
It has been a little over a month since my last update to shareholders. I am happy to report that the state of the Company is strong and growing despite a recent contraction within the cannabis industry. International Cannabrands continues to execute against its mission and continues to attract excellent partners and formidable acquisition targets.
The cannabis industry has seen tremendous progress politically in both Canada and the United States. On October 17, 2018, Canada became the second country to fully legalize marijuana. This was a watershed moment for the industry and harbinger for what's to come in the US. On November 6 Americans went to the polls and huge strides were made in the US markets. Michigan voters approved a ballot measure making their state the first in the Midwest to legalize cannabis.
Missouri approved an initiative to allow medical marijuana, as did Utah. Voters in several Ohio cities approved local marijuana decriminalization measures, and a number of Wisconsin counties and cities strongly approved nonbinding ballot questions calling for cannabis reform.
When new pro-legalization governors take their seats next year, marijuana bills in several states will have a good chance of being signed into law. In Illinois, Democrat J.B. Pritzker won the governor's race after making marijuana legalization a centerpiece of his campaign.
International Cannabrands has generated quite a bit of news since my last letter to shareholders.
On October 11, International Cannabrands announced it entered into a new agreement with Desert Zen Fulfillment LLC, for the fulfillment and distribution of its ultra premium Julian Marley JuJu Royal brand in Southern California. Desert Zen is state-compliant, recreational and medicinal cannabis manufacturing, distribution, and transportation company based in Cathedral City, California. Desert Zen was recently acquired by Chemesis International Inc. (CSE: CSI). The Agreement provides that Desert Zen will handle all aspects of product order fulfillment, product order packaging, and product shipping and inventory warehousing in the State of California for the Company on a non-exclusive basis.
Also on October 11, the Company announced it has entered into an engagement letter with Gravitas Securities Inc. ("Gravitas") and Canaccord Genuity Corp. (collectively, the "Agents"), as amended November 1, 2018, to act as agents, on a commercially reasonable "best efforts" agency basis, to offer up to 33,333,333 units of the Company (the "Units") for sale at a price of $0.15 per unit to raise gross proceeds of up to $5 million, subject to the option of the Agents (the "Over-Allotment Option") to offer for sale up to an additional 33,333,333 Units for gross proceeds of up to another $5 million (collectively, the "Offering"). Gravitas is acting as Lead Agent and has the right to act as the lead manager and sole bookrunner for the Offering.
On October 29. International Cannabrands announced the launch of Julian Marley JuJu Royal's new packaging and enhanced product suite. JuJu Royal has developed an exciting new line of products and packaging to communicate our unique position as "casual luxury", our proprietary strains and two new product line extensions. The vape category, both disposable and cartridge, and pre-roll business is experiencing dramatic growth in JuJu Royal's core markets - California, Colorado and, recently added Washington State.
On October 31 the Company announced that it completed the first significant closing event to acquire an 8.5% equity interest in La Vida Verde ("LVV") as a precursor to the acquisition of 51% of LVV that is scheduled to occur effective January 2, 2019.
Pursuant to the definitive agreement dated September 19, 2018 (the "Definitive Agreement"), as amended, the Company made its initial US$600,000 capital investment in LVV. In addition, the Definitive Agreement contemplates the Company making a subsequent US$700,000 capital investment in the business by November 23, 2018. Due to the length the LVV shareholders had held their LVV shares, the transaction was structured so that the second closing could only occur on January 2, 2019, at which point the additional 43% of LVV will be transferred to the Company in exchange for the issuance of 25,225,161 Common Shares of the Company and promissory notes for an aggregate of US$2,000,000 due as to 50% on March 31, 2019 and 50% October 31, 2019. The notes bear interest at a rate of 5% per annum and are secured by a pledge of the securities purchased. In addition, a subsequent US$700,000 capital investment is contemplated to be made in April 2019.
I look forward to sharing more with you over the coming weeks and months. Thank you for your continued support.
About International Cannabrands (ICI)
ICI acquired the exclusive rights to Julian Marley's JuJu Royal™ brand. ICI currently generates revenue from licensing brands to growers, edible manufacturers, oil extractors, producers of ancillary products and apparel in the United States where cannabis has been legalized at the state level, as well as products containing CBD in the US and internationally. ICI intends on acquiring micro brands with highly profitable operations in the cannabis space. The Company believes as the market becomes saturated with products varying in potency and quality, that the branded products will rise to the top and the Company intends to exploit all opportunities available to realize the full value of the Julian Marley brand and other brands.
About JuJu Royal
Julian Marley conveys his message of legalization, freedom, and love through the JuJu Royal brand, a line of naturally produced medicinal herbs using the best solventless technology. One percent of proceeds are distributed for the benefit of veterans using cannabis through the Weed for Warriors Project. More information about the brand and various products can be obtained at www.jujuroyal.net. International Cannabrands Ltd is continuing to work with Julian Marley to identify and develop future strains of marijuana that meet Julian's exacting standards. The Company is continuing to conduct research and development with certain origin genetics to produce additional signature Julian Marley strains for the JuJu Royal Premium Marijuana collection. The intent is to make these strains available to dispensaries and caregivers on a worldwide basis where it is legal.
International Cannabrands Contact:
Steve Gormley CFN Media Contact:
Chief Executive Officer Frank Lane (206) 369-7050
1045 Lincoln Street, #106 [email protected]
Denver, Colorado 80203
Ph: (323) 828-4321 or [email protected]
Media Inquiries: [email protected]
NEITHER THE CANADIAN SECURITIES EXCHANGE NOR THEIR REGULATION SERVICES PROVIDER HAVE REVIEWED OR ACCEPT RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.
Disclaimer concerning Forward-looking Statements
Certain statements included herein constitute "forward-looking statements" within the meaning of applicable securities laws. Such forward-looking statements include, without limitation, the completion of the Offering, the completion of the acquisition by the Company of La Vida Verde Inc., and/or other accretive acquisitions as proposed or at all, the gross proceeds of the Offering, regulatory approval of the Offering and the use of the net proceeds, if any, of the Offering. Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable by management at this time, are inherently subject to significant business, economic and competitive uncertainties and contingencies. Investors are cautioned not to put undue reliance on forward-looking statements. Additional risks and uncertainties regarding the Company are described in its publicly-available disclosure documents filed by the Company on SEDAR (www.sedar.com). The forward-looking statements contained in this news release represent the Company's expectations as of the date of this news release, or as of the date they are otherwise stated to be made, and subsequent events may cause these expectations to change. Except as required by law, the Company does not intend, and undertakes no obligation, to update any forward-looking statements to reflect, in particular, new information or future events.
SOURCE: International Cannabrands Inc.