CannAmerica Brands Corp. has entered into a non-binding letter of intent with Canna Provisions Inc. (“the Licensee”) under which the Licensee will have an exclusive license to manufacture and distribute CannAmerica branded cannabis infused gummy products and disposable vape pens, and Live Labs branded cannabis concentrate products, including droppers, shatter and wax concentrate products, and gelatin based capsules (the “Licensed Products”) in the Commonwealth of Massachusetts. Live Labs is a brand created by the founders of CannAmerica, wholly owned by the Company, and is being introduced in the Northeastern United States recreational cannabis marketplace.
Terms of the LOI are as follows:
- The initial term of the license agreement will be for a period of 3 years.
- Net price payable from Canna Provisions Inc. to the Company will be determined by a per package/unit fee relating to CannAmerica products that the Licensee decides to produce.
- Canna Provisions Inc. agrees to pay the Company a license fee to manufacture and distribute the Company’s products;
- The Licensee will purchase all un-infused consumable ingredients, packaging supplies, and branded hardware exclusively from the Company;
- Canna Provisions Inc. will follow formulations and processes provided by the Company;
- During the first 180 days of the Initial Term, the Licensee is expected to employ one full-time sales representative to exclusively promote, market, advertise and sell Licensed Products;
Subject to Board approval from the Company and completion of satisfactory due diligence, the parties intend to enter into a Definitive Agreement on or before July 15, 2019.
“The Company is looking forward to the prospects of an agreement with Canna Provisions Inc. with the intent of introducing our growing brands into Massachusetts and the Northeastern market of the United States,” said Dan Anglin, CEO and Co-Founder of CannAmerica. “The Massachusetts adult use marketplace is thriving and a perfect fit for CannAmerica Brands concept and products. Expanding into this marketplace was a fundamental goal for the brand and is an important milestone in reaching the Company’s growth goals for 2019.”
“My colleagues and I at Canna Provisions have known the CannAmerica Brands team for many years, and we are excited to work with these experienced cannabis industry professionals again—this time in the great state of Massachusetts,” said Meg Sanders, CEO of Canna Provisions Inc., which will open its first of three Massachusetts dispensaries soon in Lee, Mass. “We are confident that CannAmerica’s infused gummies and vape pens and Live Labs’ concentrates and capsules will find receptive audiences among our customers, who expect and deserve thoughtfully formulated, efficacious cannabis products that deliver consistent and repeatable effects.”