SpeakEasy Cannabis Club Ltd. (CSE: EASY) (Frankfurt: 39H) (the “Company” or “SpeakEasy“) a holder of a federal licence to cultivate, process and sell cannabis under the Cannabis Act, is delighted to announce it has signed a Processing Agreement (“Agreement“) with a Canadian Licensed Producer (the “LP“) whereby the Company has agreed to supply to and process cannabis for the LP with value added products, including extracts, pre-rolls and packaged flower from our indoor and outdoor facilities, for potential revenues and related costs of up to $10,000,000 and $2,600,000 respectively. Under the terms of the Agreement, the parties have identified a list of specified products which are considered to be exclusive products under the Agreement. The initial term of the Agreement is six (6) months with an option to extend for an additional six (6) month term upon mutual agreement of the parties.
Founder, Marc Geen states, “This contract represents a significant shift in SpeakEasy‘s business operations. Years of building and growing the Company has finally culminated in our ability to process and sell significant volumes of flower and value-added products that will be sold in the Canadian recreational market. We will continue to prepare for our amended sales licence, expected within the next 30-45 days, that will allow us to sell value-added products directly into the recreational market, this exclusivity arrangement does not affect our ability to do that. This Processing Agreement adds additional revenue visibility and financial de-risking for a significant portion of the expected production from the on-going growth of our cannabis complex.“
Sales of sun grown flower and value added products
Creation of extracted products from our outdoor flower have created interest in the market and have now translated into SpeakEasy’s first large Processing Agreement. Concentrates, pre-rolls and flower as a finished product constitute the majority of the products being supplied. The Agreement is expected to increase in volume month over month for the 6 month term.
Marc Geen, Founder, additionally states, “We have begun the process of registering with several provinces for licences to sell into the recreational market and expect to be signed on soon. Once registered, SpeakEasy will be able to sell under its own brand into those provinces. White labeled, finished products and the supply of bulk processed material is expected to remain an important part of our business plan but supplying finished products under our own brands directly to consumers is an exciting prospect that is just around the corner.”