Red White & Bloom Brands Provides Corporate Update
NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES
OR DISSEMINATION IN THE UNITED STATES
TORONTO, June 08, 2020 (GLOBE NEWSWIRE) -- Red White & Bloom Brands Inc. (CSE: RWB and OTC: TDRYD) (“RWB” or the “Company”) is pleased to advise on April 28, 2020, it completed its go public transaction by way of a reverse takeover of Tidal Royalty Corp. (“Tidal”), and on June 5, 2020 it commenced trading on the Canadian Securities Exchange (the “CSE”) under the symbol RWB and on the OTC under the symbol TDRYD (the “Transaction”).
In connection with the Transaction, certain shareholders, including management and founders of the Company, entered into voluntary escrow and/or escrow and leak out agreements totaling 36,844,823 Common shares and 3,200,000 Options to purchase Common shares. Additionally, 108,726,349 Series II Preferred shares and Options to acquire 7,401,429 Series II Preferred shares are restricted for 7 months. Lastly, RWB’s Michigan investee shareholders have agreed to participate in a voluntary share escrow agreement for the shares to be issued in connection with the closing of the acquisition. Collectively these agreements mean that over 70% of the fully diluted shares of the Company are in some form of escrow, lockup or subject to a trading restriction. Additional details of the Transaction can be found in the press release issued on April 28, 2020 and in the Listing Statement posted on the Company’s disclosure hall with the CSE.
RWB’s U.S. footprint currently spans Illinois and Massachusetts through its investee, Michigan (see below). With a combined cultivation footprint of over 4,000,000 sf, 600 employees and 22 individual facilities, RWB’s mandate is to operate at scale in select states that provide the greatest return for our partners and shareholders.
RWB has advanced in excess of US$75 million to its investee in Michigan. The Company does not report the financial performance of the investee in its financials, as it has not yet exercised its irrevocable option to acquire 100% ownership of the investee. The Company intends to exercise this option, subject to the successful completion of RWB’s licensing to operate within the state of Michigan; which application is in process now.
The Michigan investee currently holds numerous licenses within Michigan covering the entire cannabis value chain; they are strategically located throughout the state to service the majority of its 10 million residents. The investee currently owns the assets of 18 dispensaries (referred to as provisioning centers in Michigan), 10 of these operating dispensaries have achieved approximately US$70 million in trailing revenues1 over the last 12 months. The remaining 8 dispensaries are at various stages of development, are expected to open in calendar 2020 and be accretive to the current revenue run-rate. With the COVID-19 pandemic and state shelter in place orders taking effect, the investee was able to quickly pivot the business to include delivery and curb-side pick-up and within days saw an actual increase in revenue from the stores while providing a safe environment with appropriate social distancing and health and safety procedures in place for its employees and customers.