LiveWell Canada Inc. (“LiveWell” or the “Company“), (TSXV: LVWL) (OTC: LXLLF), is pleased to announce that it has partnered with Vitality CBD Natural Health Products Inc, a Canadian CBD company, (collectively the “Suppliers”) to sign a binding term sheet (“Term Sheet”) with Global Wellness Distributors, LLC (“Global Wellness”), a Nevada entity controlled by a U.S. private equity firm, for the supply of cannabidiol (CBD) wholesale products in North America.
Under the Term Sheet dated October 27, 2018, which covers a period of 15 months with an option for four renewable one-year terms, Global Wellness commits to distribute CBD isolate, distillate and full spectrum CBD oil. At closing, Global Wellness will pay a US$3 million deposit to the Suppliers for the initial CBD supply. Commencing in January 2019, Global Wellness will distribute a minimum quantity of 1,000 kilograms per month. Starting April 2019 to March 2020, the minimum quantity increases to 3,000 kilograms per month, for a total minimum quantity of 39,000 kilograms over the 15-month contract period.
LiveWell and Global Wellness will work together to market and sell CBD products in North America, leveraging sales expertise and operational support in both organizations. The parties will co-share net profits on all sales. Based on current observable wholesale market pricing, CBD isolate pricing ranges between US$6,500 to US$10,000 based on the quality and purchase volume of the CBD purchase order.
All CBD products being supplied under the Term Sheet will be derived from industrial hemp and contain no more than 0.3% THC content, making it suitable for the health and wellness market. As legalization and acceptance of CBD — the non-psychoactive cannabis compound — accelerates at a rapid pace globally, the demand for CBD products to improve health and wellness is exploding. LiveWell has conducted major research on CBD and is investing in technologies for the extraction and isolation of CBD and other cannabinoids for use in prescription and consumer health products.
“For some time now LiveWell has been quietly positioning itself to become a significant supplier of wholesale CBD to global companies looking to launch a multitude of CBD products. We recognized early on that if these companies were to enter the marketplace, a large scale, reliable source of CBD would be required, and we have assembled the assets and partnerships to provide it,” said David Rendimonti, President and CEO of LiveWell. “This is one of several partnerships we have developed that allows LiveWell to generate significant revenues at a nominal cost and no outlay of capital.”
The Term Sheet is subject to customary due diligence and execution of a definitive agreement by November 30, 2018.
CBD is the same molecule whether it comes from cannabis or hemp. However, CBD derived from hemp is more economical to produce and has a larger global market potential due to less stringent regulations worldwide for hemp. The Brightfield Group of Chicago estimates the North American market for CBD from hemp could reach US$22 billionby 2022. However, the global market could be significantly larger. Several European countries have already legalized hemp, and the World Health Organization has also recommended that CBD be descheduled across 194 nations.
About Global Wellness Distributors, LLC
Headquartered in Las Vegas, Nevada, Global Wellness Distributors, LLC (“Global Wellness”) is a new large-scale distributor of compliant hemp products, including CBD Isolate, CBD Distillate and full spectrum hemp-derived oil. The Global Wellness team consists of accomplished industry veterans whose substantial experience in the cannabis and hemp markets throughout the United States and Canada, including California, Colorado, Kentucky, and Oregon, is focused on aggregating large-scale hemp supply for distribution to identified scale buyers.
The Global Wellness team maintains strategic partnerships with domestic and international industry leaders to provide the most competitive and affordable supply solutions available to help ensure success for companies in the industrial hemp and CBD marketplace. Global Wellness’ management team brings decades of industry experience to the forefront of the ever-growing global hemp economy and are differentiated in the marketplace by their process-driven operating principals and high degree of professionalism.
About LiveWell Canada
LiveWell Canada Inc. (TSXV:LVWL, OTC: LXLLF) is an innovative cannabis and hemp company focused on advanced research on CBD and other cannabinoids, as well as developing and distributing prescription and consumer health and wellness products. The company has greenhouses under construction located in Ontarioand Québec and is supported by business partners such as Canopy Growth (TSX: WEED, NYSE: CGC) and Canopy Rivers (TSXV: RIV). For more information, visit livewellcorp.com.
Vitality CBD Natural Health Products Inc. (“Vitality”) is a privately-owned Canadian company. Through its wholly-owned subsidiary, it is a fully integrated, hemp processing and CBD isolation and wholesaling company. Vitality has just harvested over 21,000 acres of industrial hemp, purposely planted for CBD production. It has operations in Eureka, Montana under the State Farm Act with licenses to cultivate, process and market CBD in the United States. Vitality is currently producing CBD isolate in its Eureka facility in its commercial demonstration plant and is building full-scale manufacturing facilities that will increase production to over 3,000 kilograms per day of CBD isolate.