Medcolcanna Announces that Dona Blanca has Elected to Enter Stage 2 of the Joint Venture with Medcolcanna

BOGOTÁ, Colombia, May 05, 2020 (GLOBE NEWSWIRE) -- Medcolcanna Organics Inc. (TSX-V: MCCN) (“Medcolcanna”, “MCCN” or the “Company”), a Canadian medical cannabis company with operations in Colombia, is pleased to announce that, further to its press release dated April 7, 2020, Dona Blanca Limited (“Dona Blanca”), has elected to enter stage 2 of the previously announced joint venture arrangement with Medcolcanna (the “JV”) and will invest an additional $483,000 USD which will complete Dona Blanca’s total investment of $1,000,000 USD on two hectares of greenhouse space on Medcolcanna’s fully licensed cultivation property, which will earn Dona Blanca a 70% working interest (“WI”) in those two hectares.

Pursuant to the definitive agreement with respect to the JV, Dona Blanca had agreed to invest up to $1,000,000 USD ($1,408,000 CAD), to build up to an additional two (2) hectares of greenhouses on Medcolcanna’s fully licensed cultivation property, which would earn Dona Blanca a 70% working interest (“WI”) in the economic rights to the output from such greenhouses. Dona Blanca previously earned into stage one of the project, which has now been fully funded.  Dona Blanca has now elected to enter into stage two of the project whereby Dona Blanca will invest an additional $290,000 USD ($408,000 CAD) by May, 15, 2020 to earn an additional 20% WI or an aggregated 55% WI, or 1.1 net hectares in the aggregate; and stage 3 whereby Dona Blanca will invest an additional $193,000 USD ($272,000 CAD) to earn an additional 15% WI or net 1.4 hectares in the aggregate.

Management Commentary

“We are pleased to announce that Dona Blanca has elected to enter into stage two of the project and reconfirm their investment of $483,000 USD ($380,000 CAD), of which $290,000 USD ($408,000 CAD) will be funded within the next 10 business days,” commented Felipe de la Vega, CEO of Medcolcanna. “Dona Blanca’s entrance into stage two of this project further demonstrates MCCN’s commitment to professionalism of our people and operations, as well as our commitment to monitoring and tightly controlling our capital and operational expenditures, as well as G&A, in order to produce a high quality product at a low cost.  The climate and highly skilled, low cost labor available to MCCN in Colombia provides many cultivation advantages. We have effectively leveraged these advantages and continue our efforts to further reduce costs.”