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Halo Labs Inc
Symbol C : HALO
Shares Issued 158,107,872
Close 2018-10-17 C$ 0.45
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Halo Labs to supply pot oil to Falcon International

2018-10-17 11:26 ET - News Release

Mr. Kiran Sidhu reports

HALO LABS SIGNS US$2 MILLION PER MONTH EXTRACTION AGREEMENT WITH FALCON INTERNATIONAL TO SUPPLY CANNABIS OIL IN CALIFORNIA

Halo Labs Inc. has entered into an agreement with Falcon International Corp. to supply a minimum of 50,000, and up to 70,000, grams per week of bulk cannabis distillate used for vaping at $7.50 (U.S.) per gram, totalling between approximately $1.6-million (U.S.) and $2.2-million (U.S.) in monthly revenue. With initial production to occur in November, the company believes it can produce and supply 70,000 grams per week in the coming months. The contract has an initial term of six months and extends indefinitely in rolling six-month extensions. The company is finalizing the buildout of its California manufacturing facility this month and expects to deliver initial shipments in November, 2018.

Falcon International is a leading California cannabis company with exclusive contracts to produce and distribute some of California's leading brands, including The Clear and CRU. Falcon International currently distributes products to approximately 70 per cent of all California licensed dispensaries.

Summary of transaction:

  • Halo Labs to provide Falcon International with a minimum of 50,000 grams and a maximum of 70,000 grams of bulk extract each week at a price of $7.50 (U.S.) per gram;
  • Each batch to provide a total tetrahydrocannabinol concentration of at least 85 per cent;
  • The initial term is until March 24, 2019, and shall continue indefinitely until either party provides a written notice at least six months prior to the stated termination date.

Kiran Sidhu, chief executive officer of Halo Labs, commented: "Falcon has built an incredible portfolio of leading brands and has an extensive distribution network throughout California. We are honoured to be selected as their preferred cannabis oil and concentrates manufacturing partner. Halo is very excited to enter California and this contract provides a solid foundation for our operations, as we plan to accelerate our revenue quickly. We look forward to growing our partnership with Falcon as we ramp production in California and other states."

Jim Kunevicius, chief executive officer of Falcon International, commented: "We are very excited to work with Halo given their proven track record and demonstrated expertise in a variety of extractions techniques. Working with Halo allows us to focus on growing our brand portfolio and delivering consistent high-quality product to our customers. We are confident in Halo's ability to deliver large-volume contracts and see them as a long-term partner that can grow and scale with us."

Halo Labs California manufacturing

In Southern California, Halo Labs is currently working toward commencing manufacturing operations from two facilities and distribution from one facility in Cathedral City. The first facility is approximately 1,600 square feet, with approximately 500 square feet dedicated for volatile extraction in a C1D1 explosive-proof room. This facility will produce winterized, decarboxylated and distilled butane hash oil (BHO).

The second facility, which Halo Labs intends to operate in Southern California, is located within one-half mile from the first facility and is approximately 7,800 square feet. Halo Labs' manufacturing operations at this facility will include additional volatile extraction as well as non-volatile extraction and light assembly. Halo Labs also intends to utilize the facility to house its distribution business for Southern California.

About Falcon International Corp.

Falcon International is a vertically integrated California cannabis company. Falcon International is a leader in cannabis R&D (research and development) and brand development. The company's statewide distribution platform and house of brands currently serve over 70 per cent of the dispensaries in California.

About Halo Labs Inc.

Halo Labs is a cannabis extraction company that develops and manufactures quality cannabis oils and concentrates, which are the fastest-growing segments in the cannabis industry. Founded in Oregon in 2016, Halo has expertise in all major cannabis manufacturing processes, leveraging proprietary processes and products, and has produced over 2.5 million grams of oils and concentrates since inception. The forward-thinking company is led by a strong management team with deep industry knowledge and blue-chip experience. The company is currently expanding its operations with new facilities in Nevada and California.

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