Agrify Corporation has signed a definitive agreement with its first Agrify Total Turn-Key Solution customer, Bud & Mary’s Cultivation, Inc. (“B&M”). B&M is currently a tier-four licensed cultivator in Bellingham, MA and through its parent company, Bud & Mary’s, LLC, the company is a fully integrated operator in the cannabis space with one dispensary license and a home delivery license in the state of Massachusetts.
Agrify will be working with B&M on a phased approach for the build-out of B&M’s 50,000 square foot facility. The initial construction phase is expected to include installation of 774 Vertical Farming Units (“VFUs”) in a double-stacked configuration to help B&M maximize canopy space. This initial phase is expected to be completed by Q1, 2022, with up to an additional 426 VFUs installed in subsequent phases, which would bring the total up to 1,200 VFUs. Agrify will provide senior financing of up to $13.5 million for construction, which will be repaid within 24 months following the commencement of the first commercial production at the facility.
Under the terms of the agreement, Agrify will also receive fixed SaaS revenue derived from B&M’s use of the Agrify Insights cultivation software as well as additional production-based fees for up to 10 years. Assuming the completion of the maximum 1,200 VFUs being installed at full capacity, Agrify anticipates that it could generate over $28 million per annum in revenue through this partnership.
“I am thrilled to announce that we have secured our first Agrify TTK Solution partnership,” said Raymond Chang, CEO of Agrify. “This solution was developed to enable customers to access the initial capital required to quickly establish modern cultivation facilities that are outfitted with our VFUs and controlled by our Agrify Insights software, which should lead to substantial gains in yield, quality, and consistency at a significantly lower cost of production for them. In turn, we have the potential to develop deeper long-term customer relationships earlier in a company’s lifecycle, create significant IRR for our investment, and increase our total addressable market to drive long-term value creation for both our customers and our shareholders. We look forward to beginning our partnership with B&M and working together over the next 10 years to ensure they have the ability to capitalize on all the benefits our technology has to offer. We expect to announce several more of these long-term customer engagements in 2021 as we have already identified 2-3 additional TTK opportunities.”
“The team at Agrify has developed an unparalleled end-to-end solution that should allow us to get to market faster with industry-leading technology, while producing the consistent high-quality products consumers are looking for,” said David Morgan, CEO of B&M. “The ongoing support, extensive training, and knowledge base available throughout the life of our relationship combined with the data and insights available through the software platform made this the clear choice for our company. We sincerely look forward to working with the entire team at Agrify to help us establish ourselves in the growing Massachusetts market.”
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