Medcolcanna Organics Inc. Announces Operational Update and Bridge Debenture Financing

BOGOTÁ, Colombia, June 26, 2020 (GLOBE NEWSWIRE) -- Medcolcanna Organics Inc. (“Medcolcanna”, “MCCN” or “the “Company”) (TSXV: MCCN), a leading Colombian and global integrated Cannabis Company, is pleased to provide an operational update and announce that it intends to proceed with a bridge debenture financing with the principal amount of $1,000,000 (the “Offering”).  The Company intends to use the net proceeds from the financing for inventory production, inventory purchase, product rollout, expansion of sales personnel, a small allocation to complete capital expenditure investments for an extraction facility (Extralia Labs) built in compliance with European Union good manufacturing processes (“GMP EU”), as well as for general corporate purposes and funding its working capital needs. 

Management Commentary

Felipe de la Vega, President and CEO of Medcolcanna, commented: "This financing comes at a time of transition for the Company, as we transition from building out our infrastructure to executing on our commercial vision. The Company was able to develop the majority of this key infrastructure over the last 12 months; that includes 7 hectares of cultivation (5 hectares under green house, 2 hectares outdoor) (approx. 5.8 hectares net), post harvesting facility, both cultivation and post harvesting under good agricultural and collection practices (“GACP”) compliance, our fully owned third party extraction facility of approximately 5,000 square feet under GMP EU compliance called Extralia Labs with a capacity of 300 tons of dry flower per year, the update of the pharma lab to produce medical products in Colombia pending authorization from Invima, and research and development of formulations intended for medical and consumer products.”

De la Vega continued:  "As we now shift our focus on leveraging our low cost cultivation and production infrastructure in Colombia, the convertible debenture will enable us to execute optimally and efficiently on five different revenue streams, which are to roll out and will be increasing over the next four months, including seeds and cuttings sales in Colombia to other producers, cultivation and operation services (working interest, agronomical evaluation and operational management for third parties), third party extraction services, bulk products (oils, distillates and isolates), white label products and our own branded products. The achievement of all the milestones, including more production capacity than initially forecasted in both cultivation and extraction and maintaining control over our budget and expenditures, provide confidence to MCCN shareholders and investors, that MCCN and its management are committed to creating value in a tangible business that will be reflected in increasing value and generating strong returns for our shareholders.”