Nextleaf Labs Signs Cannabis Extraction Agreement with 10-acre Greenhouse Cannabis Cultivator (CSE:OILS) (OTCQB:OILFF)

VANCOUVER, April 2, 2020 /CNW/ – Nextleaf Solutions Ltd. (“Nextleaf Solutions“, “OILS“, or the “Company“) (CSE: OILS) (OTCQB: OILFF), Canada’s most innovative cannabis extractor, is pleased to announce that Nextleaf Labs Ltd. (“Nextleaf Labs“), a Health Canada licensed standard processor whose acquisition by OILS is pending, has entered into a Cannabis Extraction Agreement (the “Agreement“) with a well-known cannabis producer based in Ontario who operates a 10-acre greenhouse licensed for cannabis cultivation (the “Client“). 

The Agreement has the potential to generate up to $16MMⁱ in gross revenue for Nextleaf Labs over the next 12 months.

Cannabis Extraction Agreement

Pursuant to the Agreement, the Client will provide cannabis biomass which Nextleaf Labs will process into refined and distilled THC and CBD oils using OILS’s patented and proprietary extraction technology. The bulk distilled THC and CBD oils will be supplied to the wholesale market by Nextleaf Labs, with net proceeds of such sales expected to be shared by Nextleaf Labs and the Client. The initial term of the Agreement will end on the earlier of (a) 12 months, and (b) the date upon which 15 metric tons of biomass has been processed, and automatically renews thereafter for successive one year terms. Over the initial term, the Agreement has the potential to generate up to $16MM in gross revenueⁱ for Nextleaf Solutions, who receives the economic benefit of processing activities conducted by Nextleaf Labs pursuant to agreements between the companies.

“Our stakeholders have been eagerly awaiting the commercialization of Nextleaf Solutions’ proprietary extraction technology. We are pleased Nextleaf Labs’ first large cannabis extraction agreement is with such a strong cultivator, who has been an early industry leader producing exceptional quality product at a large scale,” stated Nextleaf Solutions CFO, Charles Ackerman. “We believe we are delivering on the overall mission of building a fundamentally-sound Company that operates one of the most efficient, technology-driven cannabis oil refineries in Canada, and we look forward to taking the business into the next phase of growth,” continued Ackerman.

Nextleaf believes there is significant opportunities to monetize lower-grade cannabis materials into high-purity distilled oil. Investments in technology enable the delivery of efficient, scalable, and lower cost solutions to B2B partners and customers, driving higher margins and ultimately a competitive barrier for the Company over the long-term. 

Nextleaf Solutions trades as OILS on the Canadian Securities Exchange, OILFF on the OTCQB Market in the United States, and L0MA on the Frankfurt Stock Exchange.

For further information, please contact:
604-283-2301 (ext. 219)
investors@nextleafsolutions.com

On behalf of the Board of Directors of the Company,

Paul Pedersen, CEO

CAUTIONARY STATEMENT

Certain statements contained in this press release constitute “forward-looking statements”. All statements other than statements of historical fact contained in this press release, including, without limitation, those regarding expected revenues resulting from the Agreement over the term, the Company’s ability to capitalize on its IP portfolio and create a competitive barrier, the efficiency and scalability of the Company’s technology and operations, expectations regarding lower concentrate costs and higher margins resulting from utilization of the Company’s technology, expectations regarding the Company’s ability to enter into further extraction agreements, and the Company’s  strategy, plans, objectives, goals and targets, and any statements preceded by, followed by or that include the words “believe”, “expect”, “aim”, “intend”, “plan”, “continue”, “will”, “may”, “would”, “anticipate”, “estimate”, “forecast”, “predict”, “project”, “seek”, “should” or similar expressions or the negative thereof, are forward-looking statements. These statements are not historical facts but instead represent only the Company’s expectations, estimates and projections regarding future events. These statements are not guarantees of future performance and involve assumptions, risks and uncertainties that are difficult to predict. Therefore, actual results may differ materially from what is expressed, implied or forecasted in such forward-looking statements. Additional factors that could cause actual results, performance or achievements to differ materially include, but are not limited to the risk factors discussed in the Company’s MD&A for the most recent fiscal period. Management provides forward-looking statements because it believes they provide useful information to investors when considering their investment objectives and cautions investors not to place undue reliance on forward-looking information. Consequently, all of the forward-looking statements made in this press release are qualified by these cautionary statements and other cautionary statements or factors contained herein, and there can be no assurance that the actual results or developments will be realized or, even if substantially realized, that they will have the expected consequences to, or effects on, the Company. These forward-looking statements are made as of the date of this press release and the Company assumes no obligation to update or revise them to reflect subsequent information, events or circumstances or otherwise, except as required by law. The CSE has not reviewed, approved or disapproved the contents of this press release.