Bhang and Origin House Mutually Terminate License Agreement

•  Bhang has contracted Trava, Inc. and Herban, Inc., California’s most prolific cannabis co-packers to manufacture Bhang-branded products and Shelf-Life Distributing to distribute Bhang’s products across California

MIAMI, Jan. 07, 2020 (GLOBE NEWSWIRE) -- Bhang Inc. (the "Company") (CSE: BHNG) (OTCQX: BHNGF), a global cannabis CPG brand company with an extensive, award-winning portfolio of products, announced today that its wholly-owned operating subsidiary, Bhang Corporation (“Bhang,” or the “Company”), has entered into a termination agreement and mutual release dated January 2, 2019 (the “Agreement”) with CannaRoyalty Corp. d/b/a Origin House, (“Origin House”) (CSE: OH) (OTCQX: ORHOF) and its wholly-owned subsidiary, Kaya Management, Inc. (“Kaya”). The Agreement terminates the previously-announced exclusive California license agreement between Bhang and Kaya (the “License Agreement”). The parties also agreed to a mutual release of claims resulting from the License Agreement.

Under the Termination and Release Agreement, Bhang will receive royalty payments, input materials, manufacturing equipment, Bhang-branded finished goods, and Origin House shares, collectively valued at approximately US$1.1M.

Bhang has contracted with Trava, Inc. and Herban, Inc., California’s most prolific cannabis co-packers to manufacture Bhang-branded products in California. In addition, Bhang has also contracted Shelf-Life Distributing to distribute these Bhang-branded products across California. Moving from a licensing model to a direct-to-retail model will allow Bhang to control the use of its brand while substantially increasing its footprint throughout California and realizing operations-derived revenue rather than royalties. Bhang’s internal sales team is working closely with retailers to ensure a smooth transition.

Bhang’s multi-state cannabis platform includes licensees in Florida, Nevada, Michigan, New Mexico, Illinois and Ohio as well as a 50/50 joint-venture with Indiva Limited (TSXV: NDVA) in Canada. The Company’s hemp-derived CBD products are available throughout the US in brick & mortar stores and online through bhangcbd.com as well as in Puerto Rico, Germany, Austria, Switzerland, Poland, and the U.K.

As announced on December 4, 2019, the Company is in process of re-locating its headquarters to California, where Bhang was initially founded in 2010. Over the past decade, Bhang has become one of the most-recognized brands in cannabis with its capital-light operating platform driven by top-tier manufacturing and distribution partners.