/THIS NEWS RELEASE IS NOT FOR DISSEMINATION IN THE UNITED STATES OF AMERICA./
VANCOUVER, March 12, 2020 /CNW/ - HempNova Lifetech Corporation, (the "Company" or "HempNova"), is pleased to announce that through its wholly owned subsidiaries, HNL2 Holdings LLC and HempNova 238 LLC, the Company has entered various agreements (the "Purchase Agreements") with Creekside Hemp Inc. ("CSHI") and NV Farms LLC to acquire a 90% interest in all the assets (the "Assets") related to an integrated hemp operation (the "Creekside Hemp Operation"), located at 442 Hanley Road, Central Point, Oregon, USA.
Creekside Hemp Operation
The Creekside Hemp Operation is an integrated hemp operation, including propagation, cultivation, harvesting, and flower drying & processing. This operation is a portion of the sixth generation Dutch Organic Farming System with entirely chemical-free and pesticide-free growing process. In 2019, CSHI farmed 145 acres of CBD hemp and CBG hemp on its own land as well as on the leased farmlands from third parties. It harvested and processed all its own top flowers and biomass, except mechanical biomass drying, which had been done in a third-party drying facility.
Assets Under the Purchase Agreements
Pursuant to the Purchase Agreements, HempNova will acquire a 90% interest in all the fixed assets and intangible assets associated with the Creekside Hemp Operation. The main fixed assets are listed as follows:
- 36.15 acres prime EFU farmland with water rights, natural gas, and 3-phase power;
- two houses with offices totaling approximately 4,900 sq. ft;
- a brand-new drying shop (15,000 sq. ft) together with three large commercial dryers;
- a newly built warehouse (9,000 sq. ft) for hemp processing and storage;
- nine newly built greenhouses, totaling approximately 27,000 sq. ft;
- two farm barns; and
- various farming, harvesting and processing equipment.
Intangible assets include Oregon Department of Agriculture ("ODA") Hemp Seed License, ODA Hemp Grower License, ODA Hemp Handler License, water rights, all the permits related to the Creekside Hemp Operation, technical know-how on all the activities from seed to customer, employee list, customer and vendor contacts and EFU farmland leases from third parties.
Terms of the Purchase Agreements
Under the Purchase Agreements, HempNova will acquire a 90% interest in the Assets from the owners who will retain a 10% interest, for a total consideration of US$4.5 million, payable in three cash instalments of US$3 million on closing, US$750,000 six months from the closing date and US$750,000 12 months from the closing date. The closing of the acquisition is expected to occur on or about April 15, 2020 and is subject to the completion of a satisfactory due diligence review by HempNova.
"We are very excited about this strategic acquisition. Southern Oregon is a regional center for hemp growing among Oregon, California and Nevada. It produces some of the most sought-after premium smokable hemp flowers in the world. We are expecting to see the demand for these unique and trendy products continue to rise vigorously in the years to come.", commented Dr. Ken Cai, President of HempNova, "After our success in biomass drying in 2019, this strategic acquisition not only reinforces HempNova's ability to be a leading vertical integrated one-stop service provider to hemp growers, but more importantly, initiates our decisive strategy in becoming a leading provider in the fledging premium smokable hemp sector."
Enhancement of Management Team
The Company is pleased to announce the appointments of Dr. Ken Cai as Chairman & CEO, and Ms. Maria Tang as the President of the Company, effective immediately. Ms. Tang joined HempNova in May 2019 as Executive Vice President and Chief Financial Officer of the Company.
The Company is also pleased to appoint Ms. Melinda Hsu as its Chief Financial Officer, effective on March 15, 2020. Ms. Hsu has over 30 years of diversified experience in areas of accounting, finance, corporate development and administration in Canada and China. Ms. Hsu was formerly the Chief Financial Officer, Corporate Secretary and Treasurer of Handeni Gold Inc. She started her career in the State Planning Commission of China and held Corporate Controller position in Titan Mining Corp. and various other mining and oil & gas companies with both Canadian and international operations. Ms. Hsu is a member of Chartered Professional Accountants of British Columbia and Ontario and has a Master of Arts in Commerce from Renmin University of China.
ON BEHALF OF THE BOARD
"Ken Z. Cai", President
CAUTIONARY NOTE REGARDING FORWARD-LOOKING INFORMATION AND CAUTIONARY NOTE TO US INVESTORS
Certain of the statements and information in this news release constitute "forward-looking information" within the meaning of applicable Canadian provincial securities laws. Any statements or information that express or involve discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions or future events or performance (often, but not always, using words or phrases such as "expects", "is expected", "anticipates", "believes", "plans", "projects", "estimates", "assumes", "intends", "strategies", "targets", "goals", "forecasts", "objectives", "budgets", "schedules", "potential" or variations thereof or stating that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved, or the negative of any of these terms and similar expressions) are not statements of historical fact and may be forward-looking statements or information.
Forward-looking statements or information are subject to a variety of known and unknown risks, uncertainties and other factors that could cause actual events or results to differ from those reflected in the forward-looking statements or information, including, without limitation, risks relating to: fluctuating equity prices, bond prices, commodity prices, foreign exchange risks, interest rate risk, foreign investment risk; loss of key personnel; conflicts of interest; dependence on management and others.
This list is not exhaustive of the factors that may affect any of the Company's forward-looking statements or information. Forward-looking statements or information are statements about the future and are inherently uncertain, and actual achievements of the Company or other future events or conditions may differ materially from those reflected in the forward-looking statements or information due to a variety of risks, uncertainties and other factors, including, without limitation, those referred to in the Company's various SEDAR filings under the heading "Risk Factors". Although the Company has attempted to identify important factors that could cause actual results to differ materially, there may be other factors that cause results not to be as anticipated, estimated, described or intended. Accordingly, readers should not place undue reliance on forward- looking statements or information.
The Company's forward-looking statements or information are based on the assumptions, beliefs, expectations and opinions of management as of the date of this news release, and other than as required by applicable securities laws, the Company does not assume any obligation to update forward-looking statements or information if circumstances or management's assumptions, beliefs, expectations or opinions should change, or changes in any other events affecting such statements or information. For the reasons set forth above, investors should not place undue reliance on forward-looking statements or information.
SOURCE HempNova Lifetech Corporation
For further information: For additional information on the Company, please contact Jennifer Trevitt at 604-688-8002.