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WOW – Canopy Growth, Organa Brands and Green House Seeds Joint Venture announced!

http://www.newswire.ca/news-releases/new-collaboration-joins-three-of-the-worlds-most-influential-cannabis-businesses-658196733.html

SMITHS FALLS, ON, DENVER and AMSTERDAM, Nov. 17, 2017 /CNW/ – Green House Holdings North America Inc. (“Green House”), its affiliate in the Netherlands, GHSC Trading B.V., National Concessions Group Inc. (“Organa Brands”) and Canopy Growth Corporation (“Canopy Growth” or “the Company”) (TSX: WEED), together three of the most storied and successful global cannabis businesses are pleased to announce the planned creation of a collaborative joint venture (the “JV”).

To establish the JV, Canopy Growth will allocate a portion of ownership in ACMPR-licensed Agripharm Corp. (“Agripharm”), a 20,000 sq. ft. indoor growing facility located in Creemore, Ontario, to its new partners. Canopy Growth will retain 40% ownership of Agripharm, while Green House and Organa Brands will own 40% and 20%, respectively, of Agripharm. In exchange for the issuance of shares, Green House and Organa Brands have granted an exclusive, royalty-free licence in Canada to certain proprietary technology, trademarks, genetics, know-how and other intellectual property to Agripharm, subject to compliance with applicable law.

The JV will create a new Canadian home-base for Green House and Organa Brands where they will work together with Canopy Growth to produce cannabis products for the Canadian market. Pursuant to the JV, the Company has the right to purchase all of the cannabis products produced by Agripharm to be exclusively distributed via Canopy Growth’s national channels, subject to limited exceptions. In addition, the Company will sublicense the proprietary technology, trademarks, genetics, know-how and other intellectual property from Agripharm in order to ensure that Canopy Growth is able to satisfy consumer demand across Canada for the suite of Green House and Organa Brands products.

Although Agripharm is focused on the Canadian market, Canopy Growth, Green House, Organa Brands and their respective affiliates will also explore other federally-legal international opportunities as they arise, including with respect to medical research and development opportunities, product distribution platforms, and brick-and-mortar retail locations. Agripharm will not conduct any business in the United States.

“Our business has separated itself from the competition by focusing on brands and products that resonate with people but also because we’ve found creative ways to collaborate with like-minded businesses to increase the breadth of our product offering,” said Mark Zekulin, President, Canopy Growth. “From world-class breeders like our partners DNA Genetics and now Green House Seeds, to sector innovators like Organa Brands, to cultural icons like Snoop Dogg, we work with the best in order to bring the best possible cannabis forward to our customers.”

The JV is expected to close on or about December 1, 2017. Operationally, Canopy Growth will transfer oversight to its new collaborators who will operate a pristine licensed facility with modular growing rooms designed to produce only the very best cannabis flowers. Green House will oversee day-to-day operations and bring their own expertise into cultivation, while Organa will implement world-class extraction functions as new and novel value-add products become part of the regulatory environment. Canopy Rivers Corporation, a partly-owned subsidiary of Canopy Growth, has also entered into an agreement to provide the JV with up to $20 million in funding for the expansion of the facility in exchange for ongoing royalty payments and a warrant to acquire up to 4% of the issued and outstanding common shares.

“For 30 years Green House Brands has been at the forefront of cannabis legalization by advocating for its normalization and expansion into new territories,” said Arjan Roskam, the founder of Green House Brands. “We’re now operating in four continents (Europe, Africa, South America and North America) and thanks to this new partnership with these two prominent market leaders in the industry, Canopy and Organa Brands, we will create even more opportunities globally to help the world access cannabis in a legal way. This epic move will allow us to maintain our position as a world leader in genetics and cannabis retail, while alerting the cannabis consumer that we will continue striving to make cannabis available worldwide for all medicinal and recreational consumers one day.”

Canopy Growth, Green House, and Organa Brands each bring a unique set of skills that are strategically complementary to one another. Canopy Growth has built an online distribution platform that touches every province and territory in Canada as well as 7 international markets; Green House is a genetic leader that has bred some of the world’s most sought-after strains; and Organa Brands is an extract product innovator. Together, the JV is positioned to take sought after genetics, insert those genetics into consumer-friendly ingestion formats, and put them on stores shelves across the country, and abroad.

“We are incredibly excited about this new partnership – since the inception of Organa Brands, one of the key tenets of our business has been forming smart partnerships with mutually beneficial results. Working with Canopy and Green House has been a surreal moment as we continue to fully recognize the impact of what this deal means for the industry as a whole” said Organa Brands Co-Founder, Jeremy Heidl. “We couldn’t have asked for better partners in Canada and beyond- this new global partnership will prove to be a defining moment for all parties involved.”

Cassels Brock & Blackwell LLP acted as legal counsel to Canopy Growth with respect to the JV, Dentons Canada LLP acted as legal counsel to Green House, and Stikeman Elliott LLP acted as legal counsel to Organa Brands.

For more information on this new partnership click here.

Here’s to Future Growth.

About Canopy Growth Corporation
Canopy Growth is a world-leading diversified cannabis company, offering distinct brands and curated cannabis varieties in dried, oil and capsule forms. Through its wholly‑owned subsidiaries, Canopy Growth operates numerous state-of-the-art production facilities with over half a million square feet of GMP-certified indoor and greenhouse production capacity, all to an unparalleled level of quality assurance procedures and testing. Canopy Growth has established partnerships with leading sector names in Canada and abroad, with interests and operations spanning four continents. The Company is proudly dedicated to educating healthcare practitioners, providing consistent access to high quality cannabis products, conducting robust clinical research, and furthering the public’s understanding of cannabis. For more information visit http://www.canopygrowth.com

About Green House Holdings North America Inc.
Green House Brands is bringing the most awarded and recognized cannabis brand in the world to the North American market. Established in 1985 in Amsterdam, the Green House Brands portfolio includes five leading marijuana businesses – Strain Hunters, Green House Seed Co., Green House Feeding, Green House Coffee shops & King of Cannabis — as seen on VICE & National Geographic. Green House assets have won the company numerous accolades, including over 40 High Times Cannabis Cups and 200+ awards for top genetics, establishing the company’s leadership in the global cannabis industry. Green House was a pioneer in the development of the European cannabis coffee shop market, where its Green House Coffee shops in the Netherlands and Strain Hunters Clubs in Spain remain market leaders. As Strain Hunters, the company has been featured in documentary series on HBO and VICE, highlighting its globetrotting journeys to find the rarest landrace strains of cannabis. Green House and Strain Hunters media has over 150M views and has one of the most powerful marketing platforms in the industry. Green House enters the rapidly developing legal North American cannabis markets with all of its enterprises. For more information please visit http://www.greenhousebrands.com

About Organa Brands
Organa Brands revolutionized the cannabis industry with the introduction of supercritical CO₂extracted cannabis oil in 2010 and the introduction of the groundbreaking O.penVAPE device in 2012. Today, the company is home to the world’s largest consumer cannabis brands. After developing O.penVAPE, Bakked, and Organa Labs into world-class brands with nationwide distribution, the company acquired The Magic Buzz, and entered into a joint venture to form District Edibles. Organa Brands sells one of its products every 4 seconds around the world, and has delivered over one billion puffs through its flagship O.penVAPE line. A brand incubator and pioneer in the cannabis space, Organa Brands utilizes its 12 production facilities in 11 states and Jamaica to manufacture its extensive catalog of products. Organa Brands sells its cannabis products in over 1,200 retail locations with ancillary hardware sold in thousands of retailers globally– making it the largest cannabis-oil-based consumer products company in the United States. Agripharm– a joint venture between Organa Brands, Canopy Growth Corporation (TSX: WEED), and the world-renowned Greenhouse Seed Company– ushers in a new era of international distribution for the three brand powerhouses. Organa Brands is committed to dominating the global cannabis market through the marriage of science and technology, all for the benefit of the consumer. For more information, please visit http://www.OrganaBrands.com

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Chris Driessen from ORGANA BRANDS — Celebrate commoditization and the birth of “Big Cannabis”

Celebrate commoditization and the birth of “Big Cannabis”

by Chris Driessen

I now buy legal cannabis by the ton. I negotiate the price of dried, ground marijuana as if it were just another commodity…because it is. Cannabis is simply an amazing agricultural commodity and precious raw material input– dropped into a not-so-complicated equation, designed to produce profit.

Just two years ago I was paying some $2,000 a pound for world class marijuana. Now that price has fallen by two thirds and I pay roughly $600 a pound. This is great news for our purchasing department, but not so much for our wholesale prices. Alas, this was inevitable, it’s simple economics. It makes market expansion all the more critical. If you are not growing, you’re dying, or soon will be. More money in the market invites more competition, which motivates us to innovate, scale and ultimately find efficiencies in our processes.. or be chewed up by the competition.

At Organa Brands, I oversee an entire house of brands that makes everything from cannabis vaporizers to THC tablets, edibles and dabs, and even energy drinks. I expect that before long, our CBD products — many of which have no THC — will be stocked on shelves at convenience stores, gas stations, Costco and Walmart.

Fortunately, that’s where my experience lies. Before entering the world of cannabis, I had spent years as a printer salesman, selling millions of dollars of commercial printers to clients throughout the Rocky Mountain region. The commercial printing business is cutthroat, as any office manager with a decent sized copy machine will attest. The hardware is sold for the narrowest of margins, or even below cost, while the emphasis is put on the consumable commodity, which is the ink.

Seem familiar? If not, what kind of cellphone do you have? You likely got the phone on the cheap or even free, as long as you signed up for the lengthy service contract. Guess where the money is made?

There are purists who shun the idea that if (when) marijuana goes mainstream, it is a disaster. They believe it’s a cave-in to big capital, big corporations, to profiteers and all things sacred of this undoubtedly magical plant. I couldn’t disagree more. If we are to unlock and share the medicinal and wellness properties of cannabis, why not champion the professional distribution of our favorite plant? Why not embrace enterprise resource planning software platforms, hi-tech manufacturing techniques, tighter inventory controls, agricultural efficiencies and crisp profit-and-loss statements?

The best homage we can make to this amazing plant is to produce the finest cannabis oil possible, to place it in attractive, finely-tuned packaging, that is both alluring to adult consumers and childproof, and offer it to consumers nationwide. The greatest contribution I can give to this industry and this amazing plant is to make sure it finds its way into as many lives as possible. We can scale our businesses larger, scrutinize costs and expenses, pour over financial reports and become the solid start-up that transforms into a legacy company that withstands the ups and down of the business world.

I believe we should celebrate national cannabis brands because we are able to incorporate up-and-coming products and place their innovative oils, edibles and medicines into our nationwide distribution network that reaches some 1,200 dispensaries in 10 states (and counting). We should support and encourage each other to become a tribe of companies, a community of cannabis enthusiasts that collectively have the market power of “Big Cannabis”. While that name scares many, it simply means that our industry has “made it.” It means we are here to stay, that we withstood the test of time and government prohibition. We have found a permanent home in the world economy.

When people criticize what they fear is the “homogenization” of marijuana, I can only laugh. Is there any better way to celebrate diversity of brands and up-and-coming entrepreneurial know-how than to offer a launch pad to those superior cannabis products? A launch pad that guarantees their product can be sold from Boston to Berlin, from San Francisco to Sydney?

It has been this same process of consolidation, which is a natural evolution in any maturing industry, that led the O.penVAPE team to look beyond vape pens and incorporate a whole new range of products, and a whole new range of possibilities. That’s why earlier this year we rebranded as Organa Brands — literally a house of brands.

For years, the company where I work was known for its O.penVAPE pens. We sold some 6 million of our cartridges and earned a strong customer following and loyalty with budtenders nationwide. Was that the result of some fortuitous “lucky break” or the natural result of dozens, then hundreds of employees working weekends, staying late and attempting to find a route to success in the highly competitive cannabis industry? I’ll let you answer that one, because I already know.

Our downtown Denver corporate office looks more like a tech startup in Silicon Valley than a mega cannabis conglomerate. We have trendy coffees that self-brew on demand, organic snacks and the requisite office pets and ping pong table. But don’t let the laid back atmosphere or tunes playing on the Sonos fool you. Our office is stocked with brilliant minds ready to go toe-to-toe with Big Tobacco, Big Alcohol and Big Pharma. We relish the opportunity to measure up against other, more mature industries. To do that we must first pass through the inevitable commoditization of our products, work with the compression of profit margins and weather the oncoming storm of consolidation.

I don’t make any medical or health claims about cannabis, but I know that a deep feeling of wellness and peace accompanies the cannabis products we produce. Every day, I receive letters of thanks. If this deep wellspring of consumer support leads to the nation’s first national chain of dispensaries, or million-acre cultivation facility, or a multinational consumer products cannabis company, I say we should all celebrate.