Become A Featured Company

FinCanna’s Flagship Investment Takes over Extraction Operations with Significant Economic Benefits

Ryan Allway

January 15th, 2018

News, Top News

VANCOUVER, British Columbia, Jan. 15, 2018 (GLOBE NEWSWIRE) — FinCanna Capital Corp. (“FinCanna”) (CSE:CALI), is pleased to report a significant development in the extraction business of its flagship investment in California.

Cultivation Technologies Inc (“CTI”) has announced that it is now directly operating its interim medical cannabis extraction facility (“Interim Extraction Facility”) and plans to directly operate its permanent facility (“Permanent Extraction Facility”) to be constructed at its 6-acre site in Coachella, California.  This change was made possible due to the new regulations in California that took effect on January 1st of this year.  In conjunction with this restructuring, FinCanna and CTI have amended their funding agreement and can capitalize on these significant economic opportunities.

Interim Extraction Facility

The Interim Extraction Facility, which commenced operations in October 2017, had been operated by a third-party tenant of CTI on its site in Coachella.  Under this prior arrangement, CTI was entitled to a maximum of 20% of the production capacity of the Interim Extraction Facility, with at least 80% of production capacity belonging to this third-party tenant, on which CTI was entitled to a minor profit share.  CTI has assumed the operational role and obtained state licenses for Type 7 manufacturing and distribution, and has the rights to 100% of the production capacity, which it will allocate towards extraction services, including white labeling for other brands, and CTI-branded sales.  The new operating structure is expected to result in significant economic opportunities to CTI.  FinCanna continues to be entitled to receive 50% of the profits of CTI which are derived from this Interim Extraction Facility. 

This Interim Extraction Facility can currently process an estimated 6,000 pounds of biomass per month to produce approximately 3.7 million grams of raw oil per year.   Under the new operating arrangement, CTI has the ability to add an additional extraction machine and fractional distillation and winterization equipment.  This would result in additional capacity to process 3,000 pounds of biomass per month and the ability to service third-party vaporizer, winterization and distillation customers at a scale of approximately 100,000 grams of finished product weekly.

Permanent Extraction Facility

The Permanent Extraction Facility was planned to be operated by a third-party tenant under similar operating and economic terms as those initially contemplated for the Interim Extraction Facility.  The new arrangement provides CTI with the ability to drive new products lines, add distribution services and improve control over sales channels.  The economics of this new operating arrangement result in potential revenues to CTI that are significantly higher than those expected prior to the restructuring.  As FinCanna receives a royalty based on sales, this translates to a significant increase in expected royalty revenues to FinCanna from the Permanent Extraction Facility once in operation. 

Funding Agreement Changes

CTI and FinCanna have also agreed to amend their funding agreement to provide for certain changes to the terms of FinCanna’s investment:

  • CTI to receive US$3.15 million dollars in tranches under the existing loan agreement with FinCanna.  The funds will be used for the restructured extraction operations, to secure an additional 5MW power commitment at the Coachella site and for working capital purposes. The investment allows CTI to capitalize upon the immediate opportunity in California through extraction, manufacturing, and distribution before construction of the Coachella Project;
  • The annual interest rate on the loan increases from 10% to 20%;
  • 7% of CTI’s revenues will be paid to FinCanna and applied against interest and principal on the loan until it is fully repaid, which may accelerate repayment of FinCanna’s loan;
  • The royalty to be earned by FinCanna on CTI’s Coachella Project increases to 14% of revenues and will be paid as a royalty (previously 10% of revenues to be paid as a dividend);
  • A new conversion feature was added to the loan, which allows FinCanna the option to convert the loan into a percentage (up to 5%) of CTI revenues in perpetuity on projects which FinCanna does not elect to fund;
  • Certain deadlines in the funding agreement related to CTI’s project financing for the Coachella Project were extended.

FinCanna CEO, Andriyko Herchak, comments, “We are thrilled with the new operating structure of CTI’s extraction operations.  As revenues from the extraction and manufacturing business are now expected to be the largest segment of CTI’s Coachella Campus, the increase in expected royalties to FinCanna are very significant.  We continue to be impressed by CTI’s exceptional management team and support their strategic approach to the market.”

About Cultivation Technologies
Cultivation Technologies, Inc. provides infrastructure, technology, and branding to the licensed medical cannabis industry. The first major project for the company is in Coachella, California, which will span 6-acres featuring cultivation centers, extraction and manufacturing facilities, a testing lab, a distribution hub, and a centralized processing center. For more information, visit www.CultivationTech.com.

About FinCanna Capital Corp.
FinCanna is a royalty company for the licensed medical cannabis industry, with a focus on California. FinCanna, led by a team of finance and industry experts, is building its portfolio of investments in scalable, best-in-class projects. FinCanna’s flagship investment is with Cultivation Technologies Inc. (“CTI”) to provide funding for its fully-entitled, large-scale indoor medical cannabis facility to be developed in Coachella, Southern California. This Coachella Campus will be a state-of-the-art facility that will include cultivation, extraction, manufacturing, testing and distribution. For additional information visit www.fincannacapital.com.

FinCanna Capital Corp.
Andriyko Herchak, CEO & Director

Investor Relations:
Arlen Hansen
Kin Communications
1-866-684-6730
CALI@kincommunications.com

Forward-Looking Information

Information set forth in this news release may involve forward-looking statements under applicable securities laws. Forward-looking statements are statements that relate to future, not past, events. In this context, forward-looking statements often address expected future business and financial performance, and often contain words such as “anticipate”, “believe”, “plan”, “estimate”, “expect”, and “intend”, statements that an action or event “may”, “might”, “could”, “should”, or “will” be taken or occur, or other similar expressions. All statements, other than statements of historical fact, included herein including, without limitation, statements about FinCanna’s ability to source suitable projects, the development and construction of the Coachella Facility, and the size and success of operations at the Interim Facility and FinCanna’s ability to generate revenues therefrom.  By their nature, forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements, or other future events, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Such factors include, among others, the risks identified in the CSE listing statement and other reports and filings with the applicable Canadian securities regulators. Forward-looking statements are made based on management’s beliefs, estimates and opinions on the date that statements are made and the respective companies undertakes no obligation to update forward-looking statements if these beliefs, estimates and opinions or other circumstances should change, except as required by applicable securities laws. Investors are cautioned against attributing undue certainty to forward-looking statements. The Company assumes no responsibility to update or revise forward-looking information to reflect new events or circumstances unless required by applicable law.

This article was published by CFN Enterprises Inc. (OTCQB: CNFN), owner and operator of CFN Media, the industry’s leading agency and digital financial media network dedicated to the burgeoning CBD and legal cannabis industries. Call +1 (833) 420-CNFN for more information.

About Ryan Allway

Mr. Allway has over a decade of experience in the financial markets as both a private investor and financial journalist. He has been actively involved in the cannabis industry since its inception, covering public and private companies.

Network Partners

Follow Us on Social Media

LinkedIn

About CFN Media Group

CFN Enterprises Inc. (OTCQB: CNFN) owns and operates CFN Media Group, the premier agency and financial media network reaching executives, entrepreneurs and consumers worldwide. Through its proprietary content creation, video library, and distribution via www.CannabisFN.com, CFN has built an extensive database of cannabis interest, assisting many of the world’s largest cannabis firms and CBD brands to build awareness and thrive. For more information, please visit www.cfnenterprisesinc.com.

Disclaimer: Matters discussed on this website contain forward-looking statements that are subject to certain risks and uncertainties that could cause actual results to differ materially from any future results, performance or achievements expressed or implied by such statements. CFN Media Group, which owns CannabisFN, is not registered with any financial or securities regulatory authority and does not provide nor claims to provide investment advice or recommendations to readers of this release. CFN Media Group, which owns CannabisFN, may from time-to-time have a position in the securities mentioned herein and will increase or decrease such positions without notice. The Information contains forward-looking statements, i.e. statements or discussions that constitute predictions, expectations, beliefs, plans, estimates, or projections as indicated by such words as "expects", "will", "anticipates", and "estimates"; therefore, you should proceed with extreme caution in relying upon such statements and conduct a full investigation of the Information and the Profiled Issuer as well as any such forward-looking statements. Any forward looking statements we make in the Information are limited to the time period in which they are made, and we do not undertake to update forward looking statements that may change at any time; The Information is presented only as a brief "snapshot" of the Profiled Issuer and should only be used, at most, and if at all, as a starting point for you to conduct a thorough investigation of the Profiled Issuer and its securities and to consult your financial, legal or other adviser(s) and avail yourself of the filings and information that may be accessed at www.sec.gov, www.pinksheets.com, www.otcmarkets.com or other electronic sources, including: (a) reviewing SEC periodic reports (Forms 10-Q and 10-K), reports of material events (Form 8-K), insider reports (Forms 3, 4, 5 and Schedule 13D); (b) reviewing Information and Disclosure Statements and unaudited financial reports filed with the Pink Sheets or www.otcmarkets.com; (c) obtaining and reviewing publicly available information contained in commonlyknown search engines such as Google; and (d) consulting investment guides at www.sec.gov and www.finra.com. You should always be cognizant that the Profiled Issuers may not be current in their reporting obligations with the SEC and OTCMarkets and/or have negative signs at www.otcmarkets.com (See section below titled "Risks Related to the Profiled Issuers, which provides additional information pertaining thereto). For making specific investment decisions, readers should seek their own advice and that of their own professional advisers. CFN Media Group, which owns CannabisFN, may be compensated for its Services in the form of cash-based and/or equity-based compensation in the companies it writes about, or a combination of the two. For full disclosure, please visit: https://www.cannabisfn.com/legal-disclaimer/. A short time after we acquire the securities of the foregoing company, we may publish the (favorable) information about the issuer referenced above advising others, including you, to purchase; and while doing so, we may sell the securities we acquired. In addition, a third-party shareholder compensating us may sell his or her shares of the issuer while we are publishing favorable information about the issuer. Except for the historical information presented herein, matters discussed in this article contain forward-looking statements that are subject to certain risks and uncertainties that could cause actual results to differ materially from any future results, performance or achievements expressed or implied by such statements. CFN Media Group, which owns CannabisFN, is not registered with any financial or securities regulatory authority, and does not provide nor claims to provide investment advice or recommendations to readers of this release. CFN Media Group, which owns CannabisFN, may from time to time have a position in the securities mentioned herein and will increase or decrease such positions without notice. For making specific investment decisions, readers should seek their own advice and that of their own professional advisers. CFN Media Group, which owns CannabisFN, may be compensated for its Services in the form of cash-based and/or equity- based compensation in the companies it writes about, or a combination of the two. For full disclosure please visit: https://www.cannabisfn.com/legal-disclaimer/.

Copyright © Accelerize Inc. · All Rights Reserved · Privacy Policy · Legal Disclaimer

loading