Arrowhead announces business expansion from bottled beverage water into organic farming and food products

/Not for disseminations in the United States or to US Persons./

NEX- TSXV Trading Symbol: AWA.H
19,492,229 Common Shares Issued

CALGARY, March 12, 2014 /CNW/ - Arrowhead Water Products Ltd. ("Arrowhead" or the "Company") is pleased to announce the signing of a Memorandum of Understanding ("MOU") with a large US based organic farming organization.  This MOU is a natural business extension from water based retail beverages to water based organic farm products.  Arrowhead is remaining in the food and beverage business.

The MOU calls for the creation of a newly formed subsidiary called Captiva Verde Farming Corp., which will be 100% owned by Arrowhead and its subsequent pending name change to Captiva Verde Industries Ltd., which will take place at Arrowhead's Annual General Meeting scheduled to be held on March 17, 2014. 

Captiva Verde Farming Corp. will be a sister company creation from this US based farming organization which has been growing organic spinach, kale, lettuce, arugula and various salad mixtures since 1983 and in the farming industry itself, for four generations.  The US based farming organization has been experiencing an exponential growth rate for the past decade and feels it beneficial to launch a high growth, sister organization through the present structure of Arrowhead. 

The MOU, which creates a fresh new organization, also calls for Arrowhead's CEO to contribute his personal allocation of 4.8 million cubic feet per year of agricultural water rights, to be contributed to the new subsidiary.  Further, the Arrowhead CEO will contribute his private farmland holdings in California as well as an arrangement to utilize any underutilized excess land of Greenbriar Capital Corp.  All contributions will be made under standard, industry-based lease agreements.  The US-based organic farming organization will add its proprietary organic farming expertise, its proprietary farmland lease acquisition methodology and all of its knowledge and expertise, in adding value to the farm to table food cycle. 

Subject to shareholder and regulatory approval, Arrowhead will issue 40 million performance based earn-out shares to various members of the current Arrowhead management team and the US based farm corporation.  The shares will be issued at the rate of one (1) share per US $0.25 (twenty-five cents) of gross farm operating income ("GFOI").  The shares are to be divided to multiple non-related parties and therefore no control shareholders will be created.  This transaction, in management's opinion, is neither a reverse takeover nor a change of business.

GFOI is defined as net farm receipts minus direct farm operating expenses.  The new subsidiary is already cultivating approximately 175 acres of prime farmland and the first seeding is expected to take place at the end of March.  It is anticipated that the 175-acres will yield four (4) crops before the end of this year.  The new subsidiary will begin to acquire additional farm leases and add to the value chain by providing the US with much needed, organically grown leaf vegetables.  Organic green leaf vegetable production cannot meet current consumer demand.  The US based farm organization is the single largest farm provider of organic spinach in the US.  Arrowhead will complete all the standard lease agreements and seek an extraordinary meeting to gain shareholder approval.  Management feels that the only risk in this business is the customary risks associated with farming operations such as weather, governmental regulations and changes in consumer demand.

Arrowhead is currently well funded to initiate the farming cycle and revenues are accrued 30-days after each planting. 

Jeff Ciachurski, CEO of Arrowhead states "we are pleased to be expanding from our recently sold beverage business, into the high growth market of organic farming and food products.  As a for-profit business, our Management feels that it has a responsibility to society to minimize its ecological footprint while maximizing the quality of products it will deliver to its customers.  This involves the implementation of business and farming practices that will conserve natural resources and energy protect the environment and enhance relationships with employees and local communities.   The Company believes in providing a safe, clean, efficient and socially responsible work environment for all employees."

On behalf of the Board of Directors of the Company and for further information, please contact:

READER ADVISORY

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

This news release contains forward-looking statements. The Company has provided the forward-looking statements in reliance on assumptions that it believes are reasonable at this time. The reader is cautioned that the assumptions used in the preparation of the forward-looking statements may prove to be incorrect. All such forward-looking statements involve substantial known and unknown risks and uncertainties, certain of which are beyond the Company's control. Such risks and uncertainties include, without limitation, delays resulting from or inability to obtain required regulatory approval. The actual results, performance or achievements could differ materially from those expressed in, or implied by, these forward-looking statements and, accordingly, no assurances can be given that any of the events anticipated by the forward-looking statements will transpire or occur, or if any of them do, what benefits, including the amount of proceeds, the Company will derive therefrom. Readers are cautioned that the foregoing list of factors is not exhaustive.

SOURCE Arrowhead Water Products Ltd.