Acreage Concludes Operations in State of Oregon, Closes Sale of Retail Chain Cannabliss & Co.

Rhea-AI Summary

Acreage Holdings has completed the sale of its four Oregon retail dispensaries, branded as Cannabliss & Co., to Chalice Brands for US$6.5 million. This deal includes a US$250,000 upfront payment and a 36-month secured promissory note for the remaining US$5.85 million at 12% interest. CEO Peter Caldini noted that exiting Oregon allows Acreage to focus on growth opportunities in the Northeastern market, particularly in the expanding New Jersey and upcoming adult-use markets in New York and Connecticut.

Positive

• Strategic exit from Oregon to focus on growth in Northeastern markets.
• Completion of the sale of dispensaries provides immediate liquidity.

Negative

• Potential revenue loss from exiting the Oregon market.

NEW YORK, July 05, 2022 (GLOBE NEWSWIRE) -- Acreage Holdings, Inc. (“Acreage” or the “Company”) (CSE:ACRG.A.U, ACRG.B.U), (OTCQX: ACRHF, ACRDF), a vertically integrated, multi-state operator of cannabis cultivation and retailing facilities in the U.S., today announced that it has executed and closed an amendment (the “Amended Agreement”) to its previously announced asset purchase and services agreement (the “Original Agreement”) with Chalice Brands Ltd. (the “Buyer” or “Chalice”) (CSE:CHAL) (OTCQB:CHALF), completing the sale of the Company’s four Oregon retail dispensaries (the “Dispensaries”) branded as Cannabliss & Co. (“Cannabliss”).

“We are pleased to bring this transaction to a close and conclude our operations in Oregon, having completed the sale of our cultivation facility earlier this year,” said Peter Caldini, Chief Executive Officer of Acreage. “Our departure from Oregon is a strategic step forward, allowing us to dedicate our time and resources to our core Northeastern footprint where we see tremendous opportunities for future growth, particularly in the recently expanded New Jersey market and the impending adult-use markets in New York and Connecticut.”

Under the terms of the Amended Agreement, the Buyer has acquired the assets of the Dispensaries for US$6,500,000 (“Purchase Price”), consisting of a US$250,000 payment previously made at the signing of the Original Agreement, plus an additional US$100,000 in cash at closing, offset by a deduction of US$300,000 from the Purchase Price to settle the accounts payable to the Buyer. The remaining amounts owing of US$5,850,000 have been satisfied by a 36-month secured promissory note (the “Note”) bearing interest at a rate of 12% per annum. Under the terms of the Note, quarterly interest payments commence on January 1, 2023, principal payments of US$1,000,000 million are due on January 1, 2024 and January 1, 2025, and the remaining principal is due on January 1, 2026.

About Acreage Holdings, Inc.

Acreage is a multi-state operator of cannabis ‎cultivation and retailing facilities in the U.S., including the Company’s national retail store ‎brand, The Botanist. With its principal address in New York City, Acreage’s wide range of national and regionally available cannabis products include the award-winning The Botanist brand, craft brand Superflux, the Tweed brand, the Prime medical brand in Pennsylvania, the Innocent brand in Illinois and others. Acreage also owns Universal Hemp, LLC, a hemp subsidiary dedicated to the distribution, marketing and sale of CBD products throughout the U.S. Since its founding in 2011, Acreage has focused on building and scaling operations to create a ‎seamless, consumer-focused, branded experience. Learn more at www.acreageholdings.com and follow us on Twitter, LinkedIn, Instagram, and Facebook.

FORWARD LOOKING STATEMENTS 

This news release and each of the documents referred to herein contains “forward-looking information” and ‎‎“forward-looking statements” within the meaning of applicable Canadian and United States securities legislation, ‎respectively. All statements, other than statements of historical fact, included herein are forward-looking ‎information, including, for greater certainty, statements regarding the New Jersey cannabis market. ‎Often, but not always, forward-looking statements and information can be identified using 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 state that certain actions, events, or results “may”, “could”, ‎‎‎“would”, “might” or “will” be taken, occur or be achieved. ‎

Although Acreage believes that the ‎assumptions and factors used in preparing the forward-looking information or forward-looking ‎statements in this news release are reasonable, undue reliance should not be placed on such information ‎and no assurance can be given that such events will occur in the disclosed time frames or at all. The ‎forward-looking information and forward-looking statements included in this news release are made as of ‎the date of this news release and Acreage does not undertake any obligation to publicly update such ‎forward-looking information or forward-looking statements to reflect new information, subsequent events ‎or otherwise unless required by applicable securities laws.

For more information, contact:

Steve Goertz
Chief Financial Officer
investors@acreageholdings.com

Courtney Van Alstyne
MATTIO Communications
acreage@mattio.com

 

FAQ

What did Acreage Holdings sell?

Acreage Holdings sold its four Oregon retail dispensaries, branded as Cannabliss & Co.

How much did Acreage Holdings receive for the dispensaries?

Acreage Holdings received US$6.5 million for the dispensaries.

What are the terms of the sale agreement by Acreage Holdings?

The sale includes a US$250,000 upfront payment and a 36-month secured promissory note for US$5.85 million at 12% interest.

What is Acreage Holdings' strategy after exiting Oregon?

Acreage plans to focus its resources on growth opportunities in the Northeastern market, especially in New Jersey, New York, and Connecticut.

What are the implications of Acreage Holdings exiting Oregon?

Exiting Oregon may lead to potential revenue loss, but allows for concentrating on more promising markets.