LiveWell Canada Inc. has partnered with Vitality CBD Natural Health Products Inc, a Canadian CBD company, to sign a binding term sheet with Global Wellness Distributors, a Nevada entity controlled by a U.S. private equity firm, for the supply of cannabidiol (CBD) wholesale products in North America.
Under the Term Sheet dated October 27, 2018, which covers a period of 15 months with an option for four renewable one-year terms, Global Wellness commits to distribute CBD isolate, distillate and full spectrum CBD oil. At closing, Global Wellness will pay a US$3 million deposit to the Suppliers for the initial CBD supply. Commencing in January 2019, Global Wellness will distribute a minimum quantity of 1,000 kilograms per month. Starting April 2019 to March 2020, the minimum quantity increases to 3,000 kilograms per month, for a total minimum quantity of 39,000 kilograms over the 15-month contract period.
LiveWell and Global Wellness will work together to market and sell CBD products in North America, leveraging sales expertise and operational support in both organizations. The parties will co-share net profits on all sales. Based on current observable wholesale market pricing, CBD isolate pricing ranges between US$6,500 to US$10,000 based on the quality and purchase volume of the CBD purchase order.
All CBD products being supplied under the Term Sheet will be derived from industrial hemp and contain no more than 0.3% THC content, making it suitable for the health and wellness market. As legalization and acceptance of CBD — the non-psychoactive cannabis compound — accelerates at a rapid pace globally, the demand for CBD products to improve health and wellness is exploding. LiveWell has conducted major research on CBD and is investing in technologies for the extraction and isolation of CBD and other cannabinoids for use in prescription and consumer health products.
“For some time now LiveWell has been quietly positioning itself to become a significant supplier of wholesale CBD to global companies looking to launch a multitude of CBD products. We recognized early on that if these companies were to enter the marketplace, a large scale, reliable source of CBD would be required, and we have assembled the assets and partnerships to provide it,” said David Rendimonti, President and CEO of LiveWell. “This is one of several partnerships we have developed that allows LiveWell to generate significant revenues at a nominal cost and no outlay of capital.”
LiveWell Canada and Vitality Sign Major CBD Supply Deal with U.S. Private Equity Firm
Published: October 30, 2018
