Sugarmade Signs Binding LOI to Acquire Cultivation Operation with Potential for 64 Tons of Cannabis Flower Production Per Annum

Rhea-AI Summary

Sugarmade, Inc. (OTCMKTS:SGMD) has signed a Binding Letter of Intent to acquire Lemon Glow Company, Inc., including its assets and 640 acres of real estate in Lake County, California, designated for cannabis cultivation. The agreement allows for outdoor cultivation on 32 acres, with an estimated yield of 128,000 pounds of cannabis per year. The core management team from Lemon Glow, with over 30 years of experience, will stay on under three-year contracts. Sugarmade has committed $400K in earnest money and aims to close the deal within 30 days from March 28, 2021.

Positive

• Acquisition of Lemon Glow could enhance Sugarmade's cannabis cultivation capabilities.
• Potential annual yield of 128,000 pounds of cannabis may increase revenue.
• Experienced management team from Lemon Glow is retained, providing continuity.

Negative

• Acquisition terms include a commitment of $400K in earnest money without immediate returns.
• Closing is contingent on a 30-day timeframe, introducing execution risk.
• Financial integration and operational challenges may arise post-acquisition.

NEW YORK, April 01, 2021 (GLOBE NEWSWIRE) -- via InvestorWire -- Sugarmade, Inc. (OTCMKTS:SGMD) (“Sugarmade,” “SGMD” or the “Company”) is excited to announce the signing of a Binding Letter of Intent (the “LOI”) for the acquisition of Lemon Glow Company, Inc., a California corporation (“Lemon Glow”), including all of Lemon Glow’s assets, interests, property, and rights, which includes six-hundred-forty (640) acres of real estate (the “Property”) located in Lake County, California, outside of the Commercial Cannabis Cultivation Exclusion Zones.

As stipulated in the LOI, thirty-two (32) acres of the Property have been designated for outdoor cannabis cultivation. Sugarmade and Lemon Glow management have agreed that the annual potential cultivation yield at the Property is approximately four thousand (4,000) pounds of dry trimmed cannabis flower per acre, or approximately 128,000 pounds of dry trimmed cannabis flower per year.

Lemon Glow executive team members Sam Luu and Ryan Santiago will, according to the LOI, become the core management team at Sugarmade’s cannabis cultivation site at the Property, with both continuing on with the business operation under three-year management contracts. The core management team has more than 30 years of combined experience in cultivation.

Sugarmade has already deposited $400K in earnest money towards the acquisition. The Company has thirty (30) days to close the acquisition from the effective date of the LOI, which has been established as March 28, 2021.

“As discussed in our recent corporate update, we are taking aggressive steps toward the establishment of full farm-to-door cannabis operations at scale in the California cannabis marketplace, and this acquisition represents a major part of that strategy,” commented Jimmy Chan, CEO of Sugarmade.

About Sugarmade, Inc.

Sugarmade, Inc. (OTCMKTS:SGMD) is a product and branding marketing company investing in operations and technologies with disruptive potential. Our Brand portfolio includes CarryOutsupplies.com, SugarRush™, NUG Avenue and Budcars.

For more information, please visit www.Sugarmade.com.

FORWARD-LOOKING STATEMENTS: This release contains "forward-looking statements" within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements also may be included in other publicly available documents issued by the Company and in oral statements made by our officers and representatives from time to time. These forward-looking statements are intended to provide management's current expectations or plans for our future operating and financial performance, based on assumptions currently believed to be valid. They can be identified by the use of words such as "anticipate," "intend," "plan," "goal," "seek," "believe," "project," "estimate," "expect," "strategy," "future," "likely," "may," "should," "would," "could," "will" and other words of similar meaning in connection with a discussion of future operating or financial performance. Examples of forward-looking statements include, among others, statements relating to future sales, earnings, cash flows, results of operations, uses of cash and other measures of financial performance.

Because forward-looking statements relate to the future, they are subject to inherent risks, uncertainties and other factors that may cause the Company's actual results and financial condition to differ materially from those expressed or implied in the forward-looking statements. Such risks, uncertainties and other factors include, among others, such as but not limited to: economic conditions, changes in the laws or regulations, demand for products and services of the company, the effects of competition, uncontrollable forces of nature and other factors that could cause actual results to differ materially from those projected or represented in the forward looking statements.

Any forward-looking information provided in this release should be considered with these factors in mind. We assume no obligation to update any forward-looking statements contained in this report.

Corporate Contact:
Jimmy Chan
+1-(888)-982-1628
info@Sugarmade.com  

Investor Relations Contact:
EDM Media, LLC
https://edm.media

Corporate Communications:
InvestorBrandNetwork (IBN)
Los Angeles, California
www.InvestorBrandNetwork.com
310.299.1717 Office
Editor@InvestorBrandNetwork.com

FAQ

What is the significance of Sugarmade's acquisition of Lemon Glow?

The acquisition aims to establish a robust cannabis cultivation operation, enhancing Sugarmade's market presence.

How much cannabis can Sugarmade potentially cultivate after acquiring Lemon Glow?

Sugarmade estimates a potential annual yield of approximately 128,000 pounds of cannabis.

How much did Sugarmade deposit for the acquisition of Lemon Glow?

Sugarmade has deposited $400,000 in earnest money towards the acquisition.

What is the timeline for closing the Lemon Glow acquisition by Sugarmade?

Sugarmade has 30 days from the effective date of the LOI, which is March 28, 2021, to close the acquisition.

Who will manage the cannabis cultivation site after the acquisition?

Core team members from Lemon Glow will manage the site under three-year contracts after the acquisition.