Mr. Andriyko Herchak reports
FINCANNA PORTFOLIO COMPANY CTI COMMENCES CANNABIS EXTRACTION AND MANUFACTURING AT NEW PALM DESERT FACILITY
Fincanna Capital Corp.'s portfolio company, Cultivation Technologies Inc. (CTI), conducting business as Coachella Manufacturing has commenced production at its new facility in Palm Desert, Calif.
The new 5,200-square-foot, state-of-the-art facility is purposefully designed to maximize workflow efficiencies, optimize productivity and reduce operating costs. Engineered for industrial scale, the facility has approximately over three-times the capacity of CTI's previous interim facility in Coachella, Calif., with a new estimated annual capacity of approximately $35-million (U.S.).
CTI, the first state-approved butane hash oil (BHO) manufacturer in California, had been operating at its interim facility in Coachella since legalization in January, 2018. Over the past two years, CTI has built a prominent reputation and loyal customer base of leading brands from across the state, having won numerous awards and first-place finishes from industry-leading competitions including the prestigious Emerald Cup, High Times, Kushstock Festival and Weedcon Wonderland.
Hank Casillas, chief operating offcier and director of CTI, and former division vice-president of multibillion-dollar health care enterprise CVS Health, stated: "Moving into our permanent facility marks a new era for CTI. Our new facility will enable us to deliver even more high-quality and innovative products with improved efficiencies. We are excited to demonstrate our market strengths to our customers, the industry and our shareholders."
Andriyko Herchak, chief executive officer of Fincanna Capital, stated: "The announcement of CTI, our first investee company, relaunching production at its new state-of-the-art Palm Desert facility ushers in a new era of positive financial performance for Fincanna. Lead by an exceptional team in a facility purpose-built for rapid and cost-effective scalability, we have every confidence in the future growth of CTI."
The Palm Desert facility utilizes a BHO extraction method that allows for rapid and efficient extraction of cannabinoids. Premium manufacturing and processing equipment is deployed throughout the facility including high-performance, subzero freezer storage for up to 10,000 pounds of biomass, which serves to preserve the integrity of cannabis in the creation of the highest-quality shatter, wax, crumble, sauce diamonds and terpenes. CTI provides state-licensed high-quality concentrates for white-label manufacturing, toll processing and packaging to hand-selected brands and cultivators across California.
Effective Jan. 1, 2020, Fincanna is entitled to receive 10 per cent of CTI's top-line revenue in perpetuity, subject to certain buyback options, of which 5 per cent is paid in cash monthly and 5 per cent is deferred. The accrued deferred payment will be paid out upon certain triggering events, including a change of control, an initial public offering or certain other specified events of CTI. Additionally, Fincanna would be entitled to receive 25 per cent to 50 per cent of the gross sales proceeds of any change-of-control transaction with the final percentage to be determined according to certain predetermined parameters.
CTI is strategically located in California, which is expected to post a record $3.1-billion (U.S.) in licensed cannabis sales for 2019, solidifying its status as the largest legal cannabis market in the world. Legal sales are up approximately 23 per cent from an approximate $2.5-billion (U.S.) in 2018, the first year of licensed cannabis sales in California, according to recent analysis by sales-tracking firms Arcview Market Research and BDS Analytics.
About Fincanna Capital Corp.
Fincanna is a royalty company that provides growth capital to rapidly emerging private companies operating in the licensed United States cannabis industry. The company earns its revenue from royalties paid by its investee companies that are calculated based on a percentage of their total revenues. Fincanna's scalable royalty model provides an attractive alternative or complement to debt or equity financing for its investee companies. Fincanna is focused on delivering high-impact returns to its shareholders by way of a strategically diversified investment portfolio.
We seek Safe Harbor.
© 2020 Canjex Publishing Ltd. All rights reserved.