News release
Milestones CALGARY, AB / ACCESSWIRE / December 17, 2018 / International Cannabrands Inc. (CSE: JUJU) (the "Company") is pleased to announce that it has received an update on the business of Riotus SODO LLC ("Riotus SODO"). Further to its press releases dated August 16 and 29, 2018, the Company made an investment of $500,000 in Riotus SODO. The investment ultimately represented a 20.6% ownership position. Previous estimates indicated the Company received a 25% position in Riotus SODO, however as the manager of Riotus SODO raised additional equity, the overall percentage obtained was impacted accordingly. Riotus LLC provides expansion capital and business/project consulting services to experienced operators in the state legalized cannabis industry in the United States. Each investment is distinct and is structured as a series LLC. Riotus SODO is focused on the expansion/development of an 8,000 ft2 (350+ light) cultivation facility in Seattle, WA (the "Expansion Project"). The operator of the facility is Solstice Holdings Inc. ("Solstice"), a leading brand and distribution company in Washington State. In connection with the investment, Riotus SODO is entitled to receive fixed payments from Solstice beginning in the fourth month after completion of the Expansion Project. Important milestones were achieved in November 2018 for the Expansion Project, including completing full designs, obtaining permitting from the relevant authorities and commencing construction. The Expansion Project was originally forecast to begin operations in March 2019 and to generate returns for Riotus SODO four months later (the "Full Distribution Date") beginning in July 2019. Riotus SODO informed the Company that it expects the Expansion Project to begin generating cash flow earlier than initially projected and that the expansion is currently under budget. If Solstice is able to realize the expected benefits from the Expansion Project and the Company's investment in Riotus SODO performs to plan, starting on the Full Distribution Date the Company should receive cash distributions of approximately US$25,000 a month for 21 months, and then approximately US$10,000 a month thereafter for a number of years. There are no costs associated with the distributions or offsetting amounts expected to be deducted. "We are extremely pleased that Riotus SODO is performing well. As we mentioned previously, Riotus' introduction to Solstice resulted in a WA distribution letter of intent between Solstice and our JuJu Royal business. The specifics of that agreement are being negotiated with an expectation for a Q1 launch," noted Steve Gormley, CEO of the Company. "The expected cash flow from Riotus SODO will provide a valuable contribution to our financial performance and our overall goal to begin generating positive cash flow from operations," added Gormley. Read more: https://m.digitaljournal.com/pr/4073625#ixzz5Zx4Uy7Ke