CannaRoyalty Investee Rich Extracts Receives Commercial Cannabis Processing License in Oregon
Ottawa, Canada, May 18, 2017 – CannaRoyalty Corp. (CSE: CRZ) (OTCQX: CNNRF) (“CannaRoyalty” or the “Company”) announced today that the Company’s investee, Rich Extracts LLC, has received a processing license from the Oregon Liquor Control Commission (“OLCC”), which allows it to begin producing cannabis products and wholesaling these products to licensed distributors and dispensaries throughout Oregon.
As previously announced CannaRoyalty has advanced approximately US$2.3 million in debt to Rich Extracts, and CannaRoyalty has the right to convert US$2.15 million of this debt into a 30% royalty stream on Rich Extracts’ gross sales in perpetuity.
“This is a major milestone for Rich Extracts and CannaRoyalty. Rich Extracts’ award-winning brand, with a mission to produce the highest quality, purest cannabis concentrates and distillates, sets itself apart and positions it to be a true market leader,” said Marc Lustig, CEO of CannaRoyalty. “Our perpetual 30% royalty interest in this high-growth opportunity will enable us to participate in this upside. With the closing of our deal with River on May 15th, this marks the second major deal this week providing CannaRoyalty shareholders access to revenue streams from market-leading partners.”
Rich Extracts has constructed a 30,000 square foot facility in Oregon to produce cannabis extract products using a variety of proprietary extraction technologies and processes. Anticipating the new standards that were to be enacted by the OLCC, Rich Extracts began a significant development and expansion of its operations in order to meet the expected OLCC guidelines. With its OLCC license now granted, the facility has the capacity to produce a total of 80,000 grams of concentrates and distillates per month (or just under 1 million grams annually). Based on industry information, current wholesale prices in Oregon for such products typically range from $15-20 per gram, but may be higher or lower depending on quality.
Rich Wilkinson, Chief Executive Officer of Rich Extracts commented, “With this license and the growth capital provided by CannaRoyalty, Rich Extracts can commence commercial operations with the goal of being one of the most advanced, full spectrum cannabis extraction, and processing facilities in the country.”
CannaRoyalty is a fully integrated, active investor and operator in the legal cannabis sector. Our focus is to build and support a diversified portfolio of growth-ready assets in high-value segments of the cannabis sector, including research and intellectual property, consumer brands, and industry infrastructure. Our management team combines a hands-on understanding of the cannabis industry with seasoned financial know-how, assembling a platform of holdings via royalty agreements, equity interests, secured convertible debt and licensing agreements.
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