LOS ANGELES, May 11, 2020 /PRNewswire/ -- International Cannabrands Inc. dba Radiko Holdings (CSE: RDKO) (the "Company") is pleased to announce it has completed its transaction with BioNeva Innovations of Carson City, LLC ("BioNeva"), Sierra Superfoods, LLC ("Sierra") and DB3 Management, LLC ("DB3").  

Steve Gormley, CEO of the Company commented: "This transaction adds significant enterprise value, and furthers our corporate development strategy of acquiring select, highly-profitable value chain investments to facilitate brand growth, enhance margins and bolster cash flow. We appreciate the patience of our shareholders as we worked to finalize this transaction amid COVID-19, and we look forward to reporting our progress as we execute our plan."

The transaction achieves the acquisition of: 

1. Buildings and equipment used for the operation of BioNeva Innovations of Carson City, LLC (collectively, the "Cultivation Operations").

BioNeva is a cannabis cultivator that holds cultivation licenses issued by the State of Nevada for both medical and recreational marijuana. The fully operational facility consists of 8,250 ft² indoor cannabis greenhouse situated on approximately one acre of leased land near Carson City, NV. The facility's flowering canopy is 4,000 ft² and incorporates a highly efficient roof glazing material, as well as highly efficient auxiliary lighting systems.

Radiko expects BioNeva to harvest an estimated 36-44 KG per month with sales possibly beginning as early as June 2020.  The Cultivation Operations are currently managed by DB3, an entity that was acquired by the Company.  

2. Sierra Superfoods, LLC, which holds hard assets and equipment associated with the BioNeva Cultivation Operations.

Sierra owns the building and equipment used for the Cultivation Operations. There is a 4,250 ft² facility designed to grow and distribute mushrooms for the culinary trade located within the property which the Company anticipates may be converted to cannabis cultivation at a future date.

3. Existing management agreements held by DB3 for one cultivation and one cultivation/production facility in Nevada.

In addition to the management of BioNeva, DB3 has a management agreement for an unrelated cannabis cultivation/extraction/production site under development in Washoe County, NV. The Washoe location is designed for a 20,000 ft² greenhouse with the capacity for approximately 148kg (325 lbs) per month. The Washoe facility is still under construction but is expected to be operational in Q4 of 2020 and generating revenue by Q1 of 2021.

DB3 has an agreement to receive USD$15,000 per month from its management of the Washoe site (with potential for 30% of net profits). Once operational, Radiko estimates the 20,000 ft² indoor grow and production/extraction facility under DB3 management should produce between 136-156 kg of premium flower per month while operating a best in class extraction/production lab.  

Bob Yosaitis, a director of the Company and a holder of BioNeva, Sierra and DB3, added: "I am extremely pleased that Radiko and BioNeva are able to join forces and create broader opportunities for both organizations. The Radiko team has extensive cannabis experience and the expertise to build successful operations for both the Carson City [BioNeva] and Washoe locations, and the addition of cultivation should contribute significantly to overall earnings and provide a valuable platform for Radiko's portfolio of brands."

Further to the release dated February 13, 2020*, and the letters of intent entered into by the Company, the Company acquired Sierra and DB3, as well as the right to acquire BioNeva.  To acquire the Cultivation Operations the Company issued an aggregate of  28,805,833 common shares and obtained a vendor take-back loan with a principal amount of US$3.25 million (the "VTB Loan"). The VTB Loan bears interest at the rate of 5% per annum and the principal amount is payable in a lump sum payment due on December 31, 2024. The VTB is secured by a pledge of the various LLC interests acquired, as well as over the assets of Sierra.  There are no principal or interest payments on the on the VTB Loan for the first two years, after which point interest only is payable quarterly through the issuance of common shares of the Company at a price equal to the volume-weighted average closing price of the common shares for the 20 trading days prior to each quarterly interest payment date.   

While the acquisition does not constitute a related party transaction for the purposes of Multilateral Instrument 61-101 Protection of Minority Security Holders in Special Transactions, Bob Yosaitis, a director of the Company holds a 25.3% interest in BioNeva, a 25.3% interest in Sierra and a 40% interest in DB3. As a result of the Transaction Mr. Yosaitis was issued a total of 7,839,722 common shares and a secured note in the principal amount of $884,434.  Mr. Yosaitis abstained from voting in connection with the approval of the transactions.

Nevada License Review

The Nevada Department of Taxation, the entity that regulates the cannabis industry in Nevada, announced on October 17, 2019, that it had implemented an extended review process and that it would not be processing any existing or new applications that relate to the transfer of licenses and change of ownership/interests while the extended review is in place.  The acquisition of BioNeva will be completed as soon as practicable following termination of the extended review period.  

* International Cannabrands Enters Into Binding LOI With BioNeva Innovations of Carson City, LLC to Acquire Cultivation in Nevada

About Radiko Holdings

International Cannabrands Inc. dba Radiko Holdings (RDKO) is a CBD and cannabis-focused brand portfolio, leveraging the potential of the plant by offering best of breed products that naturally complement today's consumer lifestyles. The Company's mission is to build and market a diversified portfolio of cannabis and CBD brands, with strategic manufacturing and distribution partnerships to support better EBITDA and margins. RDKO markets products with THC content where that practice has been legalized at the state level through either medicinal or recreational use. RDKO also markets products containing CBD in the US and internationally. The Company believes as the legal cannabis and CBD markets evolve, high-quality, unique products will increasingly capture market share and provide a valuable platform for growth.

NEITHER THE CANADIAN SECURITIES EXCHANGE NOR ITS REGULATION SERVICES PROVIDER HAS REVIEWED OR ACCEPT RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.

Disclaimer Concerning Forward-looking Statements

Certain statements included herein constitute "forward-looking statements" relating to the timing and anticipated yield from the Cultivation Operations and the related assets, within the meaning of applicable securities laws. Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable by management at this time, are inherently subject to significant business, economic and competitive uncertainties and contingencies. Investors are cautioned not to put undue reliance on forward-looking statements. Additional risks and uncertainties regarding the Company are described in its publicly-available disclosure documents filed by the Company on SEDAR (www.sedar.com). The forward-looking statements contained in this news release represent the Company's expectations as of the date of this news release, or as of the date they are otherwise stated to be made, and subsequent events may cause these expectations to change. Except as required by law, the Company does not intend, and undertakes no obligation to update any forward-looking statements to reflect, in particular, new information or future events.  

Radiko Holdings Contact:

Steve Gormley
Chief Executive Officer
International Cannabrands, Ltd.
12655 W Jefferson Blvd
Los Angeles, CA, 90066
Ph: +1-(323)-828-4321 or steve@radikoholdings.com

Investor Relations Contact:
Dave Burwell, Vice President
The Howard Group
#350, 318 - 11 Avenue SE
Calgary, AB T2G 0Y2
Ph: +1-(403)-221-0915 or dave@howardgroupinc.com

Media Inquiries: media@radikoholdings.com

SOURCE Radiko Holdings