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13.02.2020
BevCanna Signs Exclusive Agreement with Clearwater Canngrow

Advances partnership with renowned cannabis cultivator to grow certified organic sun-grown cannabis

 

VANCOUVER, BC., February 13, 2020. Emerging leader in infused beverages BevCanna Enterprises Inc. (CSE: BEV, Q:BVNNF, FSE:7BC) (“BevCanna” or the “Company”), is pleased to announce that it has expanded its previously signed agreement with renowned cannabis cultivator Clearwater Canngrow Ltd. (“Clearwater”).

 

BevCanna and Clearwater have entered into an amendment  agreement  dated  February  12,  2020  (the “Amendment Agreement”) to the consultant agreement (the “Consultant Agreement”) dated September 16, 2019 which was described in a news release dated September 17, 2019. Under the new agreement, Joey Bedard-Brunet, the principal of Clearwater, has agreed to become a director of BevCanna.

 

“The exclusive agreement with Clearwater CannGrow will assist BevCanna to more than double its potential cannabis biomass output.” said John Campbell, Chief Strategy Officer of BevCanna. “At the same time, we will recoup our original capital expenditures and eliminate all future cash outlays for farm related capital expenditures and operating costs.”

 

“The economics of the amended agreement are compelling. The prior agreement would have net BevCanna an 85% pre-tax profit participation on potential revenues from 130-acres of cannabis production, with all capital and operating expenses on BevCanna’s account. The amended agreement gives BevCanna a 50% net revenue participation on 292-acres of cannabis production with no cash outlays whatsoever.”

 

Under the terms of the Amendment Agreement, Clearwater has agreed to:

 

-          provide its services in respect of outdoor cultivation of cannabis exclusively to BevCanna;

 

-          pay for all future capital and operational expenses incurred in connection with the performance of the services under the Consultant Agreement;

 

-          permit BevCanna to retain $2,000,000 from potential revenue from cannabis cultivated at the Company’s outdoor cultivation site prior to the payment of Clearwater’s share of potential revenue; and

 

-          the removal of all cash fees and potential cash bonuses previously payable to Clearwater under the original Consultant Agreement;

 

In exchange, BevCanna has agreed to:

 

-          issue 1,000,000 common shares in the capital of the Company to Clearwater at a deemed price of $0.50 per share in consideration for the amendments to the Consultant Agreement, including the exclusivity in respect of outdoor cultivation of cannabis;

 

-          one time reimbursement to Clearwater for certain expenses up to $3,400,000 incurred in connection with the performance of the services under the Consultant Agreement, including initial expected debt settlements in the amount of $500,000 at a deemed price of $0.50 per share and $362,000 at a deemed price of $0.425 per share, subject to compliance with applicable securities laws and the approval of the Canadian Securities Exchange;

 

-          pay Clearwater an operational cost of $10,000 per acre of outdoor cultivation site, payable only from potential revenue from cannabis cultivated at the Company’s outdoor cultivation site, instead of the cash fees previously payable under the Consultant Agreement;

 

-          increase the share of potential revenue from cannabis cultivated at the Company’s outdoor cultivation site payable to Clearwater, from 15 percent to 50 percent;

 

-          reimburse Clearwater for certain expenses in the event of a change of control of the Company; and

 

-          pay Clearwater the previously mentioned operational fee and 50% revenue share in the event of a change of control, for any current year in which the change of control occurs and for the subsequent year.

 

-          All securities issued in connection with the Amendment Agreement will be subject to a statutory hold period of four months and one day from the date of issuance in accordance with applicable securities legislation.

 

None of the securities issued in connection with the Amendment Agreement will be registered under the United States Securities Act of 1933, as amended (the 1933 Act”), and none of them may be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the 1933 Act. This news release shall not constitute an offer to sell or a solicitation of an offer to buy nor shall there be any sale of the securities in any state where such offer, solicitation, or sale would be unlawful.

 

About BevCanna Enterprises Inc.

 

BevCanna Enterprises Inc. (CSE: BEV, Q:BVNNF, FSE:7BC) BevCanna Enterprises Inc. develops and manufactures cannabinoid-infused beverages and consumer products for in-house brands and white label clients. With decades of experience creating, branding and distributing iconic brands that have resonated with consumers on a global scale, the team demonstrates an expertise unmatched in the emerging cannabis beverage category. Based in British Columbia, Canada, BevCanna has a 292-acre outdoor cultivation site in the Okanagan Valley and the exclusive rights to a pristine spring water aquifer, access to a world-class 40,000-square-foot, HACCP certified manufacturing facility, with a current bottling capacity of up to 210M bottles per annum. BevCanna’s vision is to be a global leader in infused innovations.

 

On behalf of the Board of Directors:

John Campbell, Chief Financial Officer and Chief Strategy Officer Director, BevCanna Enterprises Inc.

 

For media enquiries or interviews, please contact:

Wynn Theriault, Thirty Dash Communications 416-710-3370

wynn@thirtydash.ca

 

For investor inquiries, please contact: Luca Leone, BevCanna Enterprises Inc. 604-880-6618

luca@bevcanna.com

 



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