Chalice Brands Ltd. concludes an amended agreement for


PORTLAND, Oregon, July 05 2022 (GLOBE NEWSWIRE) — Chalice Brands Ltd. (CSE: CHAL) (OTCQB: CHALF) (the “Company” Where “chalice marks“), a leading consumer-focused cannabis company specializing in retail, production, processing, wholesale and distribution, today announces that the Company has signed an amending agreement on June 1 July 2022 (the “Amending Agreement), to improve the terms of its previously disclosed asset purchase agreement (the “Initial agreement”), which was originally executed on September 16, 2021, to acquire four retail stores under the Cannabliss & Co. brand (“Cannabliss“) of Acreage Holdings, Inc. (“Area”), for a total consideration of 6,500,000 USD. The closing of the transaction as modified by the amending agreement (the “Transaction”) is subject to approval by the Oregon Alcohol and Cannabis Commission (“CCOL”) and satisfaction of other closing conditions. OLCC approval is expected within the next 30 days.

“The modification of the original transaction allows us to better match the consideration to be paid with the expected cash flows of Cannabliss. This transaction represents an important step as we continue to grow our presence in Oregon and refine the performance of the Cannabliss stores under the direction of our leadership team,” said Jeff Yapp, President and CEO of Chalice Brands. “We look forward to positively leveraging this transaction to drive revenue growth for our shareholders, our employees and the communities we serve.”

Settlement agreement

  • Upon execution of the amending agreement, Chalice Brands will acquire the assets of the four Cannabliss-branded outlets for a total consideration of US$6,500,000 (the “Purchase price“), consisting of a payment of $250,000 already made when the initial agreement was signed, plus an additional $100,000 in cash at closing, offset by a deduction of $300,000 from the purchase price to settle Accounts Payable to Chalice Brands Chalice Brands will pay the balance owing of $5,850,000, by means of a 36-month secured promissory note (the “To note”) bearing accrued interest at an annual rate of 12%. Chalice Brands will make the following lump sum payments to Acreage: (i) $1,000,000 on January 1, 2024 and $1,000,000 on January 1, 2025, and (ii) on January 1, 2026, Chalice Brands will pay all amounts due to Acreage in under this note, if applicable.
  • Chalice Brands Acquires Four Cannabliss & Co. Outlets, Further Expanding Our Oregon Statewide Retail Footprint to a Total of 18 Locations with Added Iconic Dispensary Locations Such as the Fire Store Station in Southeast Portland.

“As stores struggle to stand out in today’s increasingly competitive marketplace, bringing Chalice Farms quality standards to more dispensaries makes the industry as a whole better and more established. This acquisition marks a huge accomplishment for our team and our valued partners as we increase the visibility of our commitment to the factory, the planet and the people,” commented Meghan Miller, Chief Operating Officer of Chalice Brands.

“This renegotiated agreement structure provides Chalice with a longer time frame to repay debt obligations while avoiding dilution for shareholders. To date, we have only recorded management fee income. approval from the OLCC, we will begin to fully recognize the revenue generated by these stores. Management is confident that we can scale the product mix, thereby increasing margins and improving our top line to achieve a flow positive cash flow for the transaction, allowing Chalice to self-finance the acquisition,” said John Varghese, Executive Chairman of the company. “We strongly believe that consolidation is an essential strategy to becoming a true leader in the Oregon cannabis with an established platform for growth in other markets.”

About Chalice Brands Ltd.

Chalice Brands is a leading consumer-focused cannabis company specializing in production, processing, wholesale, distribution and retail, with 12 owned dispensaries and 6 operated dispensaries in Portland, Oregon and around around. The company is committed to developing a dynamic portfolio built around trusted Chalice Brands brands, including Chalice Farms, Left Coast Connection, Homegrown Oregon and Cannabliss & Co., with a focus on health and wellness. Chalice operates nationwide through Fifth & Root and has operations in Oregon and California. Visit investors.chalicebrandsltd.com/ for regular updates.

Investor Relations:
Jean Varghese
Executive Chairman
Chalice Brands Ltd
971-371-2685
[email protected]

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

Disclaimer: This press release contains “forward-looking information” within the meaning of applicable securities laws. Forward-looking information includes, but is not limited to, statements regarding the future business activities of the Company, the opinions or beliefs of management and future business objectives. Generally, forward-looking information can be identified by the use of forward-looking terminology such as “plans”, “expects” or “does not expect”, “is planned”, “budget”, “expects”, “estimates”, “forecasts”, “intends”, “anticipates” or “does not anticipate”, or “believes”, or variations of these words and expressions or declares that certain actions, events or results “could”, “could”, “could”, “could” or “will be taken”, “will occur” or “will be carried out”. Forward-looking information is subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of the Company to be materially different from those expressed or implied. by such forward-looking information. These risks include, but are not limited to, general business, economic and competitive uncertainties, regulatory risks, market risks, risks inherent in manufacturing and retail operations such as unexpected costs and production, difficulties in maintaining brand loyalty and other risks of the cannabis industry. . Although the Company has attempted to identify important factors that could cause actual results to differ materially from those contained in the forward-looking information, there may be other factors that cause results not to be those anticipated, estimated or expected. There can be no assurance that such information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking information. Forward-looking information is provided herein for the purpose of presenting information about management’s current expectations regarding the future and readers are cautioned that such information may not be appropriate for other purposes. The Company does not undertake to update any forward-looking information except in accordance with applicable securities laws. This press release does not constitute an offer of securities for sale in the United States, and such securities may not be offered or sold in the United States absent registration or an exemption from registration or an exemption from registration.

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