VANCOUVER, British Columbia, July 10, 2018 (GLOBE NEWSWIRE) -- via NetworkWire -- Sunniva Inc. ("Sunniva" or
the “Company”) (CSE:SNN) (OTCQX:SNNVF), a North American provider of cannabis products and services, is pleased to
announce that it intends to spin out its Canadian assets into a separate Canadian entity and apply to list the shares on the
Toronto Stock Exchange (“TSX”) and the NASDAQ Stock Market (“NASDAQ”) in an effort to unlock the
underlying value of the Company’s assets on both sides of the border (the “Spinout Transaction”). The Company has
retained Canaccord Genuity Corp. to act as a financial advisor in connection with the Spinout Transaction and other strategic
initiatives.
The proposed Spinout Transaction of the Canadian assets would include Sunniva Medical Inc. (“SMI”), which is
building the Sunniva Canada Campus, 740,000 square feet of purpose-built current Good Manufacturing Practice
(“cGMP”) designed greenhouse facilities in British Columbia. SMI has a take or pay supply agreement with Canopy
Growth Corporation (“Canopy”). Under the terms of the initial two-year agreement, which includes the distribution
of Sunniva branded products, Canopy will purchase approximately 45% of Sunniva’s annual production capacity. The Canadian assets
also includes Natural Health Services Ltd. which owns and operates a network of 7 clinics in Canada specializing in medical
cannabis under the Access to Cannabis for Medical Purposes Regulations.
The US assets that would remain with the current Canadian Securities Exchange (“CSE”) listed entity include CP
Logistics, LLC (“CPL”) operating the Sunniva California Campus, 489,000 square feet of state-of-the-art,
purpose-built greenhouse facilities in Cathedral City, California that is currently under construction and includes a flagship
onsite dispensary with a distribution license. CPL also operates a licensed extraction facility in Cathedral City, which began
operations in June 2018, and has entered into services agreements to manufacture extracted products for significant brand partners
in California and will continue to look to identify new business relationships and customers and expand its extraction capabilities
at the facility. The Company also anticipates launching its first line of Sunniva branded products in the US in Q3, 2018. The US
assets also include Full-Scale Distributors, LLC which through its brand, Vapor Connoisseur, is a provider of custom, private-label
vaporizers and accessories to our brand partners.
Completion of the Spinout Transaction will require satisfying a number of conditions including Sunniva shareholder approval, CSE
approval and fulfilling the listing requirements of the TSX and NASDAQ exchanges, none of which can be assured. Shareholders of
Sunniva will receive an information circular in respect of the Spinout Transaction which will include information regarding the
management, board of directors, financial statements and business plans of each of the entities. A meeting of the shareholders of
Sunniva will be required.
Current Sunniva shareholders at the record date of the meeting will receive a proportionate number of shares in the new entity
as part of the Spinout Transaction as well as continue to hold a proportionate number of shares in the current CSE listed entity.
The shares of each company would then trade separately on their respective stock exchanges.
The Company expects the Spinoff Transaction will be completed prior to the end of 2018.
Dr. Holler, CEO of Sunniva stated, “We feel Sunniva is undervalued and through the Spinoff Transaction we hope to unlock
significant value for our existing shareholders. Creating a new Canadian company with our Canadian assets and listing them on the
TSX and NASDAQ would be expected to bring added visibility and additional analyst coverage to our story and has the potential to
attract institutional investors that are currently unable to purchase stock on the CSE or purchase companies holding US assets.”
Dr. Holler continued, “Our CSE listed entity, Sunniva Inc., will continue to focus on full vertical integration in California and
other states with a focus on potential mergers and acquisitions or partnerships, further expansion of licensed retail outlets, and
the near term launching of Sunniva branded products. Our initial flagship 325,000 square foot purpose-built cGMP designed Sunniva
California Campus in Cathedral City which includes our flagship Sunniva onsite dispensary is anticipated to be operational in Q4
2018 and our extraction facility commenced operations in June 2018.”
About Sunniva Inc.
Sunniva, through its subsidiaries, is a vertically integrated cannabis company operating in the world’s two largest cannabis
markets – Canada and California – where we are committed to delivering safe, high-quality products and services at scale and
creating trusted Sunniva branded cannabis products. Our vision is to become one of the lowest cost, highest quality vertically
integrated cannabis producers in the markets we serve by building large scale purpose-built current cGMP designed greenhouses and
further expansion of retail locations, offering better quality assurance with cannabis products free from pesticides, providing
better customer access to cannabis education and sourcing better therapeutic delivery devices. Sunniva’s management and board of
directors have a proven track record for creating significant shareholder value both in the healthcare and biotech industries.
For more information please visit: www.sunniva.com
Neither Canadian Securities Exchange nor its Regulation Services Provider (as that term is defined in the policies of the
Canadian Securities Exchange) accepts responsibility for the adequacy or accuracy of this release.
This press release contains forward-looking statements within the meaning of applicable securities laws. All statements that are
not historical facts, including without limitation, statements regarding future estimates, plans, programs, forecasts, projections,
objectives, assumptions, expectations or beliefs of future performance, statements regarding the terms, conditions, timing and
completion of strategic initiatives; stock exchange listings; unlocking of value; Sunniva’s plan to cultivate, produce ,
manufacture and distribute a broad range of solutions focused on patients’ and customers’ needs and Sunniva’s plans, timing and
estimates for its facilities, are “forward-looking statements.” Forward-looking statements can be identified by the use of words
such as “plans”, “expects” or “does not expect”, “is expected”, “estimates”, “intends”, “anticipates” or “does not anticipate”, or
“believes”, or variations of such words and phrases or statements that certain actions, events or results “may”, “could”, “would”,
“might” or “will” be taken, occur or be achieved. Such forward-looking statements involve known and unknown risks, uncertainties
and other factors that may cause actual results, events or developments to be materially different from any future results, events
or developments expressed or implied by such forward-looking statements. Such risks and uncertainties include, among others, the
risk factors included in the Sunniva’s continuous disclosure documents available on www.sedar.com. These factors should be
considered carefully and readers are cautioned not to place undue reliance on such forward-looking statements. Although Sunniva has
attempted to identify important risk factors that could cause actual actions, events or results to differ materially from those
described in forward-looking statements, there may be other risk factors that cause actions, events or results to differ from those
anticipated, estimated or intended. There can be no assurance that forward-looking statements will prove to be accurate, as actual
results and future events could differ materially from those anticipated in forward-looking statements. Sunniva assumes no
obligation to update any forward-looking statement, even if new information becomes available as a result of future events, new
information or for any other reason except as required by law.
Contact Information:
Dr. Anthony Holler
Chairman and Chief Executive Officer
ir@sunniva.com
Corporate Communications Contact:
NetworkNewsWire (NNW)
New York, New York
www.NetworkNewsWire.com
212.418.1217 Office
Editor@NetworkNewsWire.com
