Cannabis News

Nextleaf Solutions Ltd. (CSE: OILS) (OTCQB: OILFF) ("Nextleaf", "OILS", or the "Company"), the world's most innovative cannabis extractor, is pleased to announce the following updates around its CBD business:


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Nextleaf Boosts CBD Supply with Validated Hemp Partner

Nextleaf, through its wholly-owned subsidiary Nextleaf Labs Ltd. ("Nextleaf Labs" or "Labs"), is pleased to announce that it has validated and entered an initial supply agreement with a B.C.-based hemp supplier (the "Supplier") for CBD rich biomass.

The Supplier will provide a high-quality economical source of hemp biomass which Nextleaf Labs will process into refined and distilled CBD oils using Nextleaf's patented extraction and purification platform. The bulk distilled CBD oils will be supplied to both the wholesale market and directly to provincially-authorized distributors and retailers across Canada by Labs. The net proceeds of such sales are expected to be shared by Nextleaf Labs and the Client to maintain a working capital efficient supply.

The CBD supply will be used for three primary purposes:

  • Support the launch of partner brands directly to provincially-authorized distributors.
  • Support ongoing and future CBD bulk sales to B2B partners.
  • Support internal CBD-based product development and commercialization.

"We are very pleased to work with a reputable, B.C.-based partner who has a nationwide network of validated CBD rich hemp farms to meet our increasing demand," stated Nextleaf CFO, Charles Ackerman. "It's been a top priority for us to partner with a hemp supplier under a cost-effective model to supply OILS with CBD rich hemp at the appropriate scale to leverage what we believe to be the most efficient cannabis and hemp oil refinery in Canada," said Ackerman. "The receipt of our sales licence has unlocked new revenue segments and this agreement will offer Nextleaf the opportunity to prove the disruptive nature of our technology."

Nextleaf Provides Ingredients and Manufacturing for Atlantic Canada Partner

The Company continues to support the advancement of one of its partners who is considered an early pioneer in cannabis production in Atlantic Canada (the "Partner"), for high-purity CBD-based products, leveraging a proprietary formulation.

Upon completion of the final product validation, Nextleaf will provide ongoing bulk CBD supply and manufacturing services to support the launch of their CBD products to provincially-authorized distributors and retailers targeted for later this year.

CBD Commercialization with Rapid Emulsion Technology by OILS™

Nextleaf is pleased to announce that it has completed successful scale-up trials for a variety of market validated liquid-based product formats manufactured with the Company's proprietary CBD Rapid Emulsion Technology by OILS™ ("Rapid CBD").

The commercial launch of the Company's Rapid CBD comes at a time where OILS is starting to see further demand for its novel cannabinoid delivery technology in the beverage and edibles segments of Cannabis 2.0 products.

Additionally, Nextleaf is working towards finalizing the development of a new powdered version of its proprietary CBD Rapid Emulsion Technology and expects commercialization of the ingredient in several additional product types to commence this year.

About Nextleaf®

Nextleaf is an innovative cannabis processor that owns one of the largest portfolios of U.S. patents for the extraction, distillation, and delivery of cannabinoids. Through its wholly-owned subsidiary Nextleaf Labs Ltd, a licensed processor, the Company is a low-cost producer of cannabis distillate and private label THC & CBD oils. Nextleaf's proprietary closed-loop automated extraction plant in Metro Vancouver has a design capacity to process 600 kilos of dried cannabis into oil per day. The Company owns 13 US patents and has been issued over 70 patents globally. Nextleaf is developing delivery technology through its Health Canada Research Licence with sensory evaluation of cannabis via human testing. The Company's proprietary RAPID Emulsion Technology by OILS™ powers differentiated ingestible cannabis products.

Nextleaf Solutions trades as OILS on the Canadian Securities Exchange, OILFF on the OTCQB Market in the United States, and L0MA on the Frankfurt Stock Exchange.

Follow OILS across social media platforms: Twitter, LinkedIn, Facebook, and Instagram.

www.nextleafsolutions.com

For more information please contact:
Jason McBride
604-283-2301 (ext. 219)
investors@nextleafsolutions.com

On behalf of the Board of Directors of the Company,

Paul Pedersen, CEO

Certain statements contained in this press release constitute "forward-looking statements". All statements other than statements of historical fact contained in this press release, including, without limitation, those regarding the Company's ability to capitalize on its IP portfolio,the Company's strategy, plans, objectives, goals and targets, and any statements preceded by, followed by or that include the words "believe", "expect", "aim", "intend", "plan", "continue", "will", "may", "would", "anticipate", "estimate", "forecast", "predict", "project", "seek", "should" or similar expressions or the negative thereof, are forward-looking statements. These statements are not historical facts but instead represent only the Company's expectations, estimates and projections regarding future events. These statements are not guarantees of future performance and involve assumptions, risks and uncertainties that are difficult to predict. Therefore, actual results may differ materially from what is expressed, implied or forecasted in such forward-looking statements. Additional factors that could cause actual results, performance or achievements to differ materially include, but are not limited to the risk factors discussed in the Company's MD&A for the most recent fiscal period. Management provides forward-looking statements because it believes they provide useful information to investors when considering their investment objectives and cautions investors not to place undue reliance on forward-looking information. Consequently, all of the forward-looking statements made in this press release are qualified by these cautionary statements and other cautionary statements or factors contained herein, and there can be no assurance that the actual results or developments will be realized or, even if substantially realized, that they will have the expected consequences to, or effects on, the Company. These forward-looking statements are made as of the date of this press release and the Company assumes no obligation to update or revise them to reflect subsequent information, events or circumstances or otherwise, except as required by law. The CSE has not reviewed or approved the contents of this press release.

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Leading global cannabis company continues to expand beverage portfolio with exciting new products

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Green Thumb Industries to Hold Second Quarter 2022 Earnings Conference Call on August 3, 2022

Green Thumb Industries Inc. (Green Thumb) (CSE: GTII) (OTCQX: GTBIF), a leading national cannabis consumer packaged goods company and owner of RISE dispensaries today announced it will release second quarter financial results after the market closes on Wednesday, August 3, 2022.

A conference call and audio webcast will also be held on Wednesday, August 3, 2022, at 5:00 p.m. Eastern Time/4:00 p.m. Central Time to discuss the results and answer any questions.

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James B. Francis, chief research officer at CRB Monitor, said the space has been hit “particularly hard" by the fact that no meaningful federal reform has arrived in the country. “The cannabis industry is always going to feel that impact, and investors will have another reason to stay away,” he told the Investing News Network (INN).

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Canopy Growth Announces Exchanges with Holders of Approximately US$198 Million of Convertible Notes

 Canopy Growth Corporation (" Canopy Growth " or the " Company ") (TSX: WEED) (NASDAQ: CGC) announced today that it has entered into privately negotiated exchange agreements (collectively, the " Exchange Agreements ") with a limited number of holders (the " Noteholders "), including Constellation Brands, Inc. (" CBI ") through its wholly-owned subsidiary Greenstar Canada Investment Limited Partnership (" GCILP "), of the Company's outstanding 4.25% unsecured convertible senior notes due 2023 (the " Notes "), to acquire approximately C$255.4 million (approximately USD$198 million ) aggregate principal amount of the Notes from the Noteholders (the " Transaction ") in exchange for common shares of the Company (the " Canopy Shares ") and approximately C$3 million ( USD$2.35 million ) in cash for accrued and unpaid interest (the " Cash Payment ").

Canopy Growth Announces Exchanges with Holders of Approximately US$198 Million of Convertible Notes (CNW Group/Canopy Growth Corporation)

GCILP, a subsidiary of CBI (together " Constellation "), is participating in the Transaction and will acquire a minimum of 21,929,914 Canopy Shares and up to 30,701,880 Canopy Shares pursuant to its Exchange Agreement.

Transaction Details

In accordance with the terms of the Exchange Agreements, Canopy Growth has agreed to acquire the Notes from the Noteholders for an aggregate purchase price (excluding accrued and unpaid interest which will be paid in cash as part of the Cash Payment) of approximately C$252.8 million (approximately USD$196 million ) (the " Purchase Price "), which will be payable in such number of Canopy Shares (the " Share Consideration ") as is equal to the Purchase Price divided by the volume-weighted average trading price (the " VWAP ") of the Canopy Shares on the Nasdaq Global Select Market (the " Nasdaq ") for the 10 consecutive trading days beginning on, and including, June 30, 2022 (the " Averaging Price " and such period of time being the " Averaging Period "), subject to a floor price of US$2.50 (the "Floor Price") and a maximum price equal to US$3.50 , which is the closing price of the Canopy Shares on the Nasdaq on June 29, 2022 (the " Market Price ").

The Share Consideration, for Noteholders other than GCILP, will be satisfied by the issuance of Canopy Shares in up to two tranches as follows: (a) on the initial closing of the Transaction, anticipated to be June 30, 2022 , 34,073,160 Canopy Shares (the " Initial Closing Shares ") will be issued to the Noteholders; and (b) in the event that the Averaging Price calculated over the Averaging Period is less than the Market Price, on or about July 18, 2022 (the " Final Closing "), up to such number of Canopy Shares as is equal to the excess of the Purchase Price divided by the Averaging Price over the Initial Closing Shares. The Share Consideration for GCILP will be issued solely on the Final Closing based on the Averaging Price.

In the event that the daily VWAP of the Canopy Shares on the Nasdaq during the Averaging Period (a) exceeds the Market Price, then the daily VWAP for such trading day will instead be deemed to be the Market Price; or (b) is less than the Floor Price, then the daily VWAP for such trading day will instead be deemed to be the Floor Price, such that in no circumstances will more than 78,404,305 Canopy Shares be issuable pursuant to the Transaction.

The Notes were issued pursuant to an indenture dated June 20, 2018 , among the Company, GLAS Trust Company LLC (" GLAS Trust "), as U.S. trustee, and Computershare Trust Company of Canada , as Canadian trustee, as supplemented by supplement no. 1 to the indenture dated April 30, 2019 and supplement no. 2 to the indenture dated June 29, 2022 (collectively, the " Indenture "). As a result of supplement no. 2 to the Indenture dated June 29, 2022 between the Company, Computershare Trust Company, N.A. (as replacement U.S. trustee following GLAS Trust's resignation) and Computershare Trust Company of Canada (the " Second Supplemental Indenture "), the Company irrevocably surrendered its right to settle the conversion of any Note by Physical Settlement or Combination Settlement (as each such term is defined in the Indenture). As a result, the conversion of any Note on or after the date hereof will be settled by Cash Settlement (as such term is defined in the Indenture) and in no event will any Canopy Shares be issuable upon conversion of any Note. A copy of the Second Supplemental Indenture will be available on the Company's SEDAR profile page at www.sedar.com and on EDGAR at www.sec.gov.

GCILP currently holds C$200 million aggregate principal amount of Notes. Pursuant to the Transaction, the Company will acquire C$100 million (approximately USD$77.5 million ) aggregate principal amount of the Notes held by GCILP. GCILP will be issued a number of Canopy Shares based on the VWAP during the Averaging Period, provided that GCILP will receive a minimum of 21,929,914 Canopy Shares (based on the Floor Price) and a maximum of 30,701,880 (based on the Market Price), representing between 5.4% and 7.6% of the issued and outstanding Canopy Shares on a non-diluted basis.

Constellation, though GCILP and CBG Holdings LLC, currently holds 142,253,802 Canopy Shares, representing 35.3% of the issued and outstanding Canopy Shares on a non-diluted basis. GCILP's participation in the Transaction (the " Insider Participation ") will be considered to be a "related party transaction" within the meaning of Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions (" MI 61-101 "). Pursuant to Section 5.5(a) and 5.7(1)(a) of MI 61-101, the Company is exempt from obtaining a formal valuation and minority approval of the Company's shareholders with respect to the Insider Participation as the fair market value of the Transaction is below 25% of the Company's market capitalization as determined in accordance with MI 61-101. In addition, the Transaction was approved by the board of directors of the Company with Ms. Judy A. Schmeling , a director of CBI, Mr. Garth Hankinson , Chief Financial Officer and Executive Vice President of CBI, Mr. Robert Hanson , Executive Vice President and President – Wine & Spirits Division of CBI and James Sabia , Executive Vice President and President - Beer Division of CBI, each having disclosed their interest in the Transaction by virtue of their positions with CBI and abstaining from voting thereon.

The Transactions are being conducted as private placements, and any Canopy Shares to be issued in the Transaction will be issued pursuant to the exemption from the registration requirements of the Securities Act of 1933, as amended (the " Securities Act "), afforded by Section 4(a)(2) of the Securities Act in transactions not involving any public offering. This press release is neither an offer to sell nor a solicitation of an offer to buy any securities described above, nor will there be any offer, solicitation or sale of any securities in any jurisdiction in which such offer, solicitation or sale would be unlawful.

About Canopy Growth

Canopy Growth (TSX:WEED, NASDAQ:CGC) is a world-leading diversified cannabis and cannabinoid-based consumer product company, driven by a passion to improve lives, end prohibition, and strengthen communities by unleashing the full potential of cannabis. Leveraging consumer insights and innovation, Canopy Growth offers product varieties in high-quality dried flower, oil, softgel capsule, infused beverage, edible, and topical formats, as well as vaporizer devices by Canopy Growth and industry-leader Storz & Bickel. Canopy Growth's global medical brand, Spectrum Therapeutics, sells a range of full-spectrum products using its colour-coded classification system and is a market leader in both Canada and Germany . Through Canopy Growth's award-winning Tweed and Tokyo Smoke banners, Canopy Growth reaches its adult-use consumers and has built a loyal following by focusing on top quality products and meaningful customer relationships. Canopy Growth has entered into the health and wellness consumer space in key markets including Canada , the United States , and Europe through BioSteel sports nutrition, and This Works skin and sleep solutions; and has introduced additional hemp derived CBD products to the United States through its First & Free and Martha Stewart CBD brands. Canopy Growth has an established partnership with Fortune 500 alcohol leader Constellation Brands.

Notice Regarding Forward-Looking Information

This news release contains "forward-looking statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995 and "forward-looking information" within the meaning of applicable Canadian securities legislation. Often, but not always, forward-looking statements and information can be identified by the use of words such as "plans", "expects" or "does not expect", "is expected", "estimates", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or state that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved. Forward-looking statements or information involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company or its subsidiaries to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements or information contained in this news release. Examples of such statements and uncertainties include statements with respect to the benefits of the debt repurchase, the anticipated date of issuance of the Initial Closing Shares, the anticipated date of the issuance of any additional Canopy Shares following the Averaging Period and expectations for other economic, business, and/or competitive factors .

Risks, uncertainties and other factors involved with forward-looking information could cause actual events, results, performance, prospects and opportunities to differ materially from those expressed or implied by such forward-looking information, including inherent uncertainty associated with projections; the diversion of management time on Transaction-related issues; expectations regarding future investment, growth and expansion of operations; regulatory and licensing risks; changes in general economic, business and political conditions, including changes in the financial and stock markets and the impacts of increased rates of inflation; legal and regulatory risks inherent in the cannabis industry, including the global regulatory landscape and enforcement related to cannabis, political risks and risks relating to regulatory change; risks relating to anti-money laundering laws; compliance with extensive government regulation and the interpretation of various laws regulations and policies; public opinion and perception of the cannabis industry; and such other risks contained in the public filings of the Company filed with Canadian securities regulators and available under the Company's profile on SEDAR at www.sedar.com and with the United States Securities and Exchange Commission through EDGAR at www.sec.gov/edgar , including the Company's annual report on Form 10-K for the year ended March 31, 2022 .

In respect of the forward-looking statements and information, the Company has provided such statements and information in reliance on certain assumptions that they believe are reasonable at this time. Although the Company believes that the assumptions and factors used in preparing the forward-looking information or forward-looking statements in this news release are reasonable, undue reliance should not be placed on such information and no assurance can be given that such events will occur in the disclosed time frames or at all. Should one or more of the foregoing risks or uncertainties materialize, or should assumptions underlying the forward-looking information prove incorrect, actual results may vary materially from those described herein as intended, planned, anticipated, believed, estimated or expected. Although the Company has attempted to identify important risks, uncertainties and factors which could cause actual results to differ materially, there may be others that cause results not to be as anticipated, estimated or intended. The forward-looking information and forward-looking statements included in this news release are made as of the date of this news release and the Company does not undertake any obligation to publicly update such forward-looking information or forward-looking information to reflect new information, subsequent events or otherwise unless required by applicable securities laws.

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SOURCE Canopy Growth Corporation

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