FinCanna Portfolio Company, QVI Inc., Signs Strategic Agreement with Cherry Kola Farms and Plans to Accelerate Retail Sales Across California


Ryan Allway

November 17th, 2021

News


FinCanna to Raise up to $2,000,000 by way of a Private Placement

 

VANCOUVER, BC / ACCESSWIRE / November 17, 2021 / FinCanna Capital Corp. (“FinCanna“) (“the Company”)(CSE:CALI)(OTCQB:FNNZF) an investment company focused on the U.S. licensed cannabis industry, is pleased to announce that its portfolio company, QVI Inc., a cannabis-infused product manufacturer located in Sonoma County, California, doing business as “The Galley” has signed a Joint Venture Agreement with Cherry Kola Farms (“CKF”) an award winning producer of Premium cannabis, and is in discussions with a California distributor which has direct distribution relationships with a large number of cannabis dispensaries in California.

 

QVI is now positioned to initiate its “manufacturer to retail” revenue model featuring its own line of edible products. This strategy combines the strengths of Best-in-Class scalable production capabilities in the Galley, multi award winning cultivation of Cherry Kola Farms whose line of branded products are currently sold in 70+ retail dispensaries across the state and a distributor whose leadership team has established deep relationships across the California retail dispensary market.

 

The new “manufacturer to retail” focus is anticipated to deliver superior margins resulting from a streamlined production approach that is focused on manufacturing the Galley’s own branded products in higher volumes and fewer SKU’s. These savings can now be allocated to incentivize QVI’s distribution partner, retail dispensary owners, and to facilitate a better priced offering to consumers. Additionally, the operational alliance with Cherry Kola Farms will have the Galley manufacturing and packaging CKF’s highly popular, premium branded “live resin” products. The rollout of this new strategy is expected to launch within 90 days.

 

Additional advantages of the “manufacturer to retail” revenue model include:

  • Vertical integration with key partners to eliminate costs & increase margins across the supply chain
  • Maximize “the Galley’s” $40M+ annual production capacity
  • Drive sales of “Galley Branded” products to reduce revenue risk due to uncertainty of selling to outside brands
  • Near term addition of revenue from Cherry Kola “live resin” products
  • Disruptive “manufacture to retail” product/pricing model designed to incentivize retailers and drive market share

 

The Company also wishes to announce that Larry Shaeffer of Santa Rosa, California has been appointed President of QVI Inc. and to FinCanna’s Board of Advisors. Larry has been an unofficial advisor to the Galley for several months and is a driving force in initiating and completing the negotiations with the California distribution company and Cherry Kola Farms where he is also an advisor. Larry is well respected in the California cannabis industry with a long history as an operator, business leader and advocate. He also has extensive experience in manufacturing, logistics and business organization that has been of great benefit in the creation of this opportunity and will be especially valuable in driving operational execution of the “manufacturer to retail” business model.

 

To support the launch of this initiative FinCanna intends to raise $2,000,000 (the “Offering”) by way of a non -brokered private placement of units consisting of one common share of Fincanna and one common share purchase warrant with a term of two years (the “Units“) The Units will be priced in the context of the market and on a post consolidation basis as concurrent with closing of the Offering the common shares of FinCanna will be consolidated. The final consolidation ratio will be determined by the board of directors in the coming days and may be as high as 10 for 1.

 

The FinCanna management team will subscribe for a minimum of $250,000 of this Private Placement.

 

The closing of the Private Placement is subject to the receipt of all necessary regulatory approvals, including the approval of the Canadian Securities Exchange. All securities issued pursuant to the Private Placement will be subject to a four month hold period in accordance with applicable Canadian securities laws. The company may pay finders’ fees on a portion of the offering, subject to compliance with the policies of the Canadian Securities Exchange and applicable securities legislation.

 

As the Company is relying on the Exemption for Sales to Purchasers Advised by Investment Dealers, it confirms that there is no material fact or material change related to the Company which has not been generally disclosed. The Units will be offered pursuant to available prospectus exemptions, including sales to accredited investors.

 

FinCanna intends to use the net proceeds from the Private Placement to fund the launch of the new “manufacturer to retail” revenue strategy as well as ongoing working capital and general corporate purposes.

 

Annie Holman, Co-Founder and CEO of QVI said, “I am very excited about these new relationships and especially with the mentorship from Larry Schaeffer that was instrumental in helping align our new strategy. We all see a lot of opportunities to expand each other’s businesses ultimately generating more income for us all as well as benefitting consumers in what has become a very price sensitive market. We see a clear path to dramatically scale our business at the Galley as the synergies between our three companies accelerates. I am also thrilled that Larry will be joining us as President as he has outstanding operational skills, and it will allow me to do what I do best which is to generate revenue and market our business across the state.”

 

Andriyko Herchak, CEO of FinCanna Capital said, “Bringing these partnerships together has been in negotiations for several months and could not have been accomplished without the direction and guidance of Larry Schaeffer now QVI President and Advisor to FinCanna. The synergies of these three businesses, The Galley’s scalable, quality assured production capabilities with the highly decorated cultivation and product offerings of Cherry Kola Farms combined with the deep relationships to the retail market of our future distribution partner, truly sets QVI up for the success we always believed was possible. Our new “manufacturer to retail” business model allows us to capture significant additional margin that can be passed on across the supply chain, to our distributor, the retail dispensary owner and ultimately a better priced product for the cost sensitive consumer to drive recurring sales. It’s been quite a journey but we have always maintained our belief that California is the number one market in the world, we just needed to find a way to unlock the immense potential of our flagship investment, QVI and we believe that with these agreements we have done just that.”

 

The legal U.S. cannabis market is expected to reach more than US$41 billion in annual sales by 2025 with California, the single largest market in North America, representing an estimated 20% market share or US$8.2 billion and edibles comprising over $900m of the overall California Market (New Frontier Data)

 

About FinCanna Capital Corp.

FinCanna is an investment company that provides growth capital to rapidly emerging private companies operating in the licensed U.S cannabis industry. FinCanna is focused on delivering high impact returns to its shareholders by way of a strategically diversified investment portfolio.

 

For additional information visit www.fincannacapital.com and FinCanna’s profile at www.sedar.com

 

About QVI

QVI, which stands for Quality, Value and Integrity, is located in Sonoma County, California. Their purpose-built facility known as The Galley is differentiated from other contract manufactures by its automated capabilities to produce virtually all high-value cannabis products at large volumes under one roof. The facility is built to FDA and CDPH standards and is focused on high demand areas of production; Edibles, Topicals, Tinctures, Chocolates, Hard Candies, Gummies, Beverages, Vapes, Pre-Rolls and Flower Packaging.

 

QVI’s immediate goal is to become the premier contract manufacturer in California, the largest single market in North America and, upon success, to license products nationally and globally.

 

FinCanna Capital Corp.
Andriyko Herchak, CEO & Director

Investor Relations:
Arlen Hansen
Kin Communications
1-866-684-6730
[email protected]

 

Forward-Looking Information

Information set forth in this news release contains forward-looking statements or forward-looking information (collectively, “forward-looking statements”) under applicable securities laws. Forward-looking statements herein include,, without limitation, statements about anticipated benefits of the joint venture agreement with CKF; the launch (and timing thereof), implementation and anticipated benefits of the new “manufacturer to retail” revenue model and strategy, including anticipated superior margins, better pricing and implied profitability; the $2 million in private placement financing; the consolidation of the Company’s shares; and future plans and strategies of the Company. 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, risks that the joint venture with CKF and the new “manufacturer to retail” model and strategy may not result in the anticipated benefits to the Company, or at all; the Company may not be able to raise $2 million in private placement financing, or any funds at all; the Company may not receive approval for the $2 million financing; the Company may not be able to complete the consolidation; and the risks identified in the CSE listing statement available at www.SEDAR.com 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 undertake 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.

SOURCE: FinCanna Capital Corp.

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.


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