MONCTON, NEW BRUNSWICK – OrganiGram Holdings Inc. (TSX VENTURE:OGI)(OTCQB:OGRMF) (the “Company” or “OrganiGram”) is pleased to announce it has entered into an exclusive product development and distribution agreement with TGS International, LLC (“TGS International”).
The agreement will provide for consulting services related to the development and operation of a commercial scale cannabis extracts production and processing facility, as well as the exclusive licensing in Canada of over 225 unique cannabis products.
TGS International is an affiliate of The Green Solution, LLC (“TGS”), a vertically-integrated cannabis company which owns and operates over 300,000 square feet of state licensed and regulated production, processing, and manufacturing facilities as well as 11 medicinal and/or adult-use retail locations in the state of Colorado, with three additional locations set to open by the end of 2016. TGS has commercially developed an extensive line of cannabis extract and derivative products by using multiple extraction methodologies that are streamlined with standardized operating procedures and supported through proprietary software and security systems.
“TGS has distinguished itself as a leader in the Colorado medical and adult-use cannabis markets in terms of their sales, product quality, and reliability. Their award winning proprietary brands, The Green Solution™ and NectarBee™ have generated well over US$100MM in cumulative sales through their affiliated Colorado operations, including over US$43MM in 2015 alone,” says Denis Arsenault, Chief Executive Officer of the Company.
“OrganiGram has worked tirelessly towards the development and communication of a clear business development strategy for our company and our shareholders. Today’s announcement represents the culmination of that process for our commercial extracts strategy. OrganiGram has now raised the necessary capital, secured the required real estate, and has selected the ideal strategic partner to position OrganiGram as a major force in the emerging oils and edibles market,” says Arsenault.
Eric Speidell, Co-Chief Executive Officer of TGS states, “TGS is very excited to enter the Canadian market and to partner with one of the industry’s leading licensed producers. Over the past six years, we have proactively invested significant resources into the standardization, quality, and reliability of our processes and products. We are very proud of the success we have achieved to date in Colorado. Our brands and leadership have been recognized across the United States, with TGS franchises already established in multiple states. With this transaction, we are eager to embark on our international expansion with OrganiGram.”
Pursuant to the agreement between the Company and TGS, and subject to the approval of the TSX Venture Exchange (the “TSXV”) and other regulatory approval as may be required, the Company shall issue 437,957 common shares to TGS at a price of $1.37 per share, payable after certain calendar and operational milestones, and will provide additional cash consideration to TGS, by way of a royalty, during the term of the Agreement. Additionally, TGS shall be issued stock options in accordance with a 36-month vesting schedule.
About TGS International, LLC
TGS International, LLC is a subsidiary of TGS National Holdings, LLC, and together with The Green Solution, LLC and their affiliated entities (collectively, the “TGS Group”), have developed into one of the largest and most successful cannabis businesses in the United States. The TGS Group has developed an extensive line of cannabis products, recipes, operating procedures, software and security systems, and other intellectual property, including, but not limited to The Green Solution™ and NectarBee™ brands, which have won numerous awards for quality, taste and consistency. For more information about the TGS Group, visit www.mygreensolution.com or www.nectarbee.com.
About OrganiGram Holdings Inc.
OrganiGram Holdings Inc. is a TSX Venture Exchange listed company whose wholly owned subsidiary, OrganiGram Inc., is a licensed producer of medical marijuana in Canada. OrganiGram is focused on producing the highest quality, condition specific medical marijuana for patients in Canada. OrganiGram’s facility is located in Moncton, New Brunswick and the Company is regulated by the Access to Cannabis for Medical Purposes Regulations (“ACMPR”).
The TSX Venture Exchange Inc. has in no way passed upon the merits of the proposed transaction and has neither approved nor disapproved the contents of this press release.
This news release contains forward-looking information which involves known and unknown risks, uncertainties and other factors that may cause actual events to differ materially from current expectation. Important factors – including the availability of funds, the results of financing efforts, crop yields – that could cause actual results to differ materially from the Company’s expectations are disclosed in the Company’s documents filed from time to time on SEDAR (see www.sedar.com). Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release. The Company disclaims any intention or obligation, except to the extent required by law, to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.