EDMONTON, Alberta, Jan. 14, 2020 (GLOBE NEWSWIRE) -- Radient Technologies Inc. (“Radient” or the “Company”) (TSX Venture: RTI; OTCQX: RDDTF), a global commercial manufacturer of high quality cannabinoid-based ingredients, formulations and products, is pleased to announce it has entered into a binding Letter of Intent (the “LOI”) for a Sale-Leaseback transaction in which 2238501 Alberta Ltd. (the “Purchaser”) would purchase from Radient the land and buildings (collectively, the “Land”) comprising the Company’s Edmonton I, II, and III facilities (the “Transaction”).
The purchase price (the “Purchase Price”) shall be CAD $20 million. Upon the closing of this Transaction, the Purchaser will lease the Land back to 1631807 Alberta Ltd. (“163 Alberta”), Radient’s wholly owned subsidiary, for a term of 20 years. Prior to the closing of the Transaction, a portion of the total Purchase Price, to be determined at a later date by all involved parties, will be advanced to Radient by the Purchaser in order to complete initial scheduled construction requirements at its Edmonton III facility.
The Transaction has an implicit interest rate of 13% annually (CAD $2.6 million) against the Company’s entire Edmonton-based group of real estate assets, comprising approximately 112,500 sq. ft. of manufacturing space. The Company will use the net proceeds for general working capital purposes while completing the buildout of its 89,000 sq. ft. Edmonton III manufacturing facility, and to repay existing long-term debt.
Radient expects the Transaction to close by March 30, 2020. The Transaction is subject to customary closing conditions, including entering into a definitive agreement of purchase and sale, and TSX Venture Exchange approval.
This Transaction is part of an asset-backed financing incorporating both the aforementioned Transaction and an additional equipment financing (the “Equipment Financing”) that was initially announced in Radient’s press release dated November 29, 2019. The Equipment Financing will incorporate the equipment contained within the Edmonton I, II, and III facilities, for an additional sum of money. Radient will update shareholders when the terms of this Equipment Financing have been finalized.
Denis Taschuk, Radient’s President and CEO, commented: “We are pleased to enter into this LOI for a Sale-Leaseback transaction. This cash injection will be non-dilutive, and allows us to obtain additional working capital to finance the remainder of the buildout of our Edmonton III facility as we continue to scale up our operating capacity considerably.”
Reaffirmation of Revenue Guidance for Fiscal Q3 2020:
Radient is pleased to announce that it expects to meet or exceed its previously disclosed revenue target of at least CAD $10 million for its Q3 2020 fiscal quarter ended December 31, 2019. Radient’s Q3 2020 financials will be released at the end of February 2020.
Progress at Edmonton I and Edmonton II Facilities:
Edmonton I: Scale-up of cannabis extraction and processing at Radient’s operating Edmonton I facility continues to be successful in terms of both recovery and quality of cannabinoid extracts, positioning Radient to execute on multiple fronts as “Cannabis 2.0” gathers momentum. Recovery of cannabinoids is consistently above 90% and as much as 99%. As indicated in the Company’s corporate update on November 29, 2019, extracts have shown high levels of quality and demonstrated extended “shelf life,” with negligible cannabinoid degradation. Radient will continue to explore opportunities to establish additional partnerships with both Canadian Licensed Producers and other brands.
Edmonton II: The majority of the retrofit of Radient’s Edmonton II facility, dedicated to the extraction and downstream processing of CBD from hemp, is complete. The Company is now awaiting the approval of its application for additional licenses from Health Canada which will allow it to begin operations at this facility. Radient’s Edmonton II facility is expected to be capable of processing 420,000 kg of hemp/ year at full capacity.
Radient Technologies is a commercial manufacturer of high quality cannabinoid based formulations, ingredients and products. Utilizing a proprietary continuous-flow extraction and processing platform that recovers up to 99% of cannabinoids from the cannabis plant, Radient develops specialty products and ingredients that contain a broad range of cannabinoid and terpene profiles while meeting the highest standards of quality and safety. Please visit www.radientinc.com for more information.
SOURCE: Radient Technologies Inc.
Investors please contact: William (Bill) Wasson, Senior VP of Capital Markets and Investor Relations: email@example.com
Media/press please contact: Caitlin Cheadle, Director of Communications: firstname.lastname@example.org
Forward Looking Information:
This press release contains “forward-looking information” within the meaning of applicable Canadian securities legislation. Forward-looking information includes, without limitation, statements regarding the growth of the Company’s business operations; the construction of the Company’s facilities; the Company’s ability to close the Transaction and/or the Equipment Financing; the use of proceeds of the Transaction; the expected throughput at the Edmonton II facility; the recovery of, and quality of, cannabinoids and extracts; the Company’s expected financial results as described in “Reaffirmation of Revenue Guidance for Fiscal Q3 2020” of this press release; the Company’s ability to obtain additional licences from Health Canada; the Company’s ability to grow its business in the cannabis sector and the Company’s future plans. Generally, forward-looking information can be identified by the use of forward-looking terminology such as “plans”, “expects” or “does not expect”, “is expected”, “budget”, “scheduled”, “estimates”, “forecasts”, “intends”, “anticipates” or “does not anticipate”, or “believes”, or variations of such words and phrases or state that certain actions, events or results “may”, “could”, “would”, “might” or “will be taken”, “occur” or “be achieved”. Forward-looking information is subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of Radient, as the case may be, to be materially different from those expressed or implied by such forward-looking information. Although Radient has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking information, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking information. Radient does not undertake to update any forward-looking information, except in accordance with applicable securities laws.
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