HTC Extraction Systems has entered into a share and purchase agreement dated Nov. 21, 2019 with Starling Brands. Pursuant to the SPA, HTC will acquire all the issued and outstanding shares of Kase Farma, a subsidiary of Starling, and upon completion of the acquisition, Kase Farma will be a wholly owned subsidiary of HTC.
"Kase Farma is authorized to operate in the areas of hemp cultivation, extraction, refining, formulation and distribution in the State of California," the team with the company explains. "Kase Farma continually strives to deliver health and wellness benefits of CBD, CBG, CBN and other cannabinoids via the production of high-quality, premium hemp products through best of class methods while sustaining an unrelenting commitment to people, community and the environment."
“On behalf of Starling, we are extremely excited to integrate our experience, know how and pedigree with HTC’s technologies and pedigree to further the vision and execution as global leaders in the science and production of the highest quality cannabinoid extractions and formulations,” Reynolds said.
Pursuant to the SPA, HTC will acquire the purchased shares in exchange for US$900,000 in cash and the issuance of 8,000,000 units of HTC and 2,000,000 bonus units of HTC. Each unit will consist of one common share and one half of one common share purchase warrant of HTC. Each warrant shall be exercisable to acquire one common share at a price of C$0.70 for a period of 36 months from the completion of the transaction. Each bonus unit will consist of one common share and one half of one common share bonus purchase warrant of HTC. Each bonus warrant shall be exercisable to acquire one common share at a price of C$1.00 for a period of 36 months from the completion of the transaction. In addition, the units and bonus units shall be subject to legends restricting their transfer and which will provide that: (i) one-third of the compensation units shall become freely tradeable on the date that is 12 months following the completion of the transaction; (ii) one-third of the compensation units shall become freely tradeable on the date that is 18 months following the completion of the transaction; and (iii) one-third of the compensation units shall become freely tradeable on the date that is 24 months following the completion of the transaction.
According to them, in December, Kase Farma, will receive and commission equipment that's able to process and distill 12,000 lbs. per day of dried biomass at its “IPElite Extraction” operation in California. "Kase Farma’s “IPElite Extraction” operations are part of the vendor-owned 22,000-square-foot overall facility and will process 12,000 lbs. per day of dried biomass; which, at an 8% CBD yield, will have the capability of producing, 435,000 grams daily of CBD, delivering highest quality, saleable CBD to the wholesale market with gross revenue potential of approximately $1.4 million USD per day," they point out.
"Kase Farma also intends to build a 20,000-square-foot facility in the fall of 2020, which will have the capability to extract, refine, and formulate cannabinoids for an additional 50,000 lbs. per day of dried biomass capacity for HTC’s emerging global food and drink CBD ingredient market."
Kase Farma has launched its Identity Preserved, or IPGrow, initiative, with the intention of providing the consumer with full transparency as to where their products have come from and how they were produced, bringing accountability and verified quality to the cannabinoid industry. Kase Farma has aligned itself with hemp growers in California’s Central Valley who will provide up to 15,000 acres of high performance, IPGrow, superior, genetic specific production for its custom designed cannabinoid formulations.
Kase Manufacturing, under Starling Brands, is licensed to operate in the areas of cannabis extraction, refining, formulation and distribution in the State of California. As part of the Transaction, Kase Farma will enter into an intellectual property licensing agreement with Starling that will allow for a technology transfer whereby intellectual property and technology licensed under this agreement will be utilized and deployed in HTC’s Canadian facility.
For more information:
HTC Extraction Systems
002 – 2305 Victoria Ave.
Regina, Saskatchewan S4P 0S7
Canada
T: (306) 352-6132
F: +(306) 545-3262
E: lpk@htcextraction.com
htcextraction.com