Australis Capital Inc., operating as Audacious Brands (CSE: AUSA) (OTC: AUSAF) (“AUSA”, “Audacious”, or the “Company”) today announced the Company has entered into a supply agreement and, through its majority owned subsidiary ALPS, a facility engineering and design services contract with Belle Fleur Holdings LLC (“Belle Fleur”). The agreement furthermore includes ongoing APIS Compliance and Maintenance services. Under the supply arrangement, (subject to local licensing requirements), Belle Fleur will dedicate a certain percentage of its canopy space for the cultivation of AUSA’s proprietary cultivars under a cost +5% agreement. The Companies have agreed to jointly explore opportunities for brand collaboration and further expansion in the U.S.

Belle Fleur

Belle Fleur, founded by the powerhouse cannabis and music industry entrepreneurs behind Californian brand Rapper Weed, Rolandy Romelus, Irvin Whitlow and Domenico Cardarelli, are the holders of a license allowing the development of a Tier 11 high-tech indoor grow facility in Blandford. The Tier 11 license, the largest cultivation license tier available in Massachusetts, allows for up to 100,000 sq ft of canopy space.

Belle Fleur, through its roots in the California legacy market, has access to ultra-premium genetics not currently available in Massachusetts, and intends serving the market with luxury, premium high-end cannabis products.

Like Audacious Brands, Rapper Weed is an MSO. Following their success in California, Belle Fleur now transitions to an ownership model in Massachusetts where, with the assistance of ALPS, it will control the cultivation infrastructure to ensure it always has the high-quality product it is known for. The company is ambitious and intends to grow well beyond its footprint, with an eye on the Eastern U.S. markets. The companies have agreed jointly to explore further opportunities for collaboration in regard to brands and expansion into other jurisdictions.

The supply agreement will enable Audacious Brands to continue to expand its MSO footprint, which now includes Nevada, Arizona, Oklahoma, Missouri, Washington and Massachusetts. The Company continues to execute on its strategy and anticipates entering additional U.S. markets within the next few weeks.

Rapper Weed – Strong Connection to the Community and Culture – It’s a Lifestyle Thing

Rapper Weed was founded in Los Angeles, California – the mecca of weed culture and the beating heart of cannabis innovation. The brand’s core values consist of growing and manufacturing luxury high-end premium products 100% of the time. The founders of Rapper Weed are true connoisseurs of cannabis and are highly respected by the community and culture. They hold true to these values, never compromising creativity, consistency, quality and potency. Rapper Weed is more than a brand – it’s a lifestyle.

The founders of Belle Fleur are from Boston, they then found success in the music and cannabis industry in California. Now the team is returning to their roots, bringing back the cannabis culture to Boston and throughout the Bay State. Rapper Weed has publicly been endorsed by a large number of lifestyle influencers, including Machine Gun Kelly (https://www.rapperweed.com/), who came to the Company through Irvin Whitlow, a highly successful music industry entrepreneur.

Machine Gun Kelly, when asked for a comment on Rapper Weed, stated, “I just bought $1,000 worth of Rapper Weed at Cookies in Maywood. These guys have the best flower in the game.”

Irvin Whitlow, Co-Founder

Irvin Whitlow, co-founder, commented, “Rapper Weed consumers reflect the lifestyle of which cannabis is an important part. Rather than signing big endorsement deals with single artists, Rapper Weed has a much broader reach, resonates with the culture, and consequently has been adopted as the herb of choice by many of the people we work and interact with. In turn, this creates a broad roster of influencers for Rapper Weed, magnifying our appeal with a larger experienced audience.”

Irvin Whitlow is a highly successful, Grammy award-winning music industry executive, having sold over 30 million records throughout his career. In 2010, Irvin discovered Cleveland native Machine Gun Kelly, who soon after inked a major deal with Bad Boy and Interscope records under the team’s independent imprint, EST 19XX.

In addition to Machine Gun Kelly, Irvin has cultivated relationships with some of the hottest artists and producers in the music industry, such as Travis Barker, Nicki Minaj, Cardi B, Wiz Khalifa, Black Bear, Migos, O.T. Genasis, Young Dro, and many others. His work with producers such as Cheeze Beatz and Ayo & Keys, as well as others, has resulted in widespread recognition within the industry and with fans. In 2019 he received a BMI award for his work (songwriter) on 2018 release: “Bartier Cardi” ft 21 Savage off her Grammy award winning/multi-platinum album, Invasion of Privacy.

Mr. Whitlow continued, “We believe in curating authentic moments in which everyone can feel comfortable consuming cannabis. Gone are the days when weed was looked down upon. Cannabis is a social and a medical herb, and we at Belle Fleur and Rapper Weed pride ourselves in creating experiences that show how cannabis is part of a lifestyle, including music, art, fashion and food. We are bringing urban culture to a high-end lifestyle, and now we are taking our brands and knowledge back to Massachusetts and from there to the Eastern U.S.”

Genetics

Through its roots in California, Belle Fleur has access to ultra-premium genetics, such as Gelato 33, Gelato 42, Runtz, Sunset Sherbert, Mochi, Biscotti, Truffle and others. The Company is also working on expanding its library of proprietary genetics, which includes the XX strain, associated with Machine Gun Kelly.

Facility Agreement

Belle Fleur and ALPS have signed a significant facility agreement under which ALPS will provide facility design, construction management and (post) commissioning services. The design phase is progressing well, and the companies anticipate construction to commence in the next 30 days.

The facility will benefit from ALPS’ intellectual property, including its proprietary APIS service suite, covering compliance and maintenance. The high-tech nature of the facility will result in the cultivation of GMP and GACP compliant world class cannabis, while operating costs will remain in check. ALPS, with over three decades and over 100 million project square feet under its belt, has a highly bankable track record. Its involvement in projects has enabled its customers to obtain financing, which companies had found difficult prior to engaging with ALPS, in large part due to the significant project de-risking that ALPS brings to design, construction and cultivation operations.

Supply Agreement

Under the supply agreement, Belle Fleur will dedicate a percentage of its canopy space to Audacious cultivars. When fully licensed, AUSA will acquire the produced cannabis under a cost plus 5% arrangement. The arrangement provides Belle Fleur with a solid anchor customer, while providing AUSA with long-term access to low-cost, high-quality cannabis.

Audacious intends to launch its award-winning brands – Provisions, Tsunami and Mr. Natural in Massachusetts. The arrangement between the companies includes a provision for marketing and delivery of the AUSA products by Belle Fleur, thereby further leveraging the partnership.

Terry Booth, Audacious CEO, stated, “This arrangement completely validates our strategy and is a great example of how synergies between AUSA/ALPS and our partners Rapper Weed create a win-win-win situation for everyone involved, while creating shareholder value. Our ownership of ALPS, the premier facility design firm in the business, is enabling us to execute on a strategy that is unique and very difficult to imitate. This strategy also de-risks our expansion as we do not have to deploy significant capital to develop cultivation infrastructure, while securing long-term access to low-cost, high quality cannabis to fuel the expansion of our brands across the U.S.”

Mr. Booth continued, “Entering Massachusetts, a cannabis friendly market still in the first inning, is one of many amazing opportunities in the eastern U.S. We are really excited about the agreement with Belle Fleur, as we will be working with an exceptionally accomplished team of entrepreneurs who get what this industry is about: brands that are inclusive and resonate with a broad target audience, including the community and culture. What they have achieved to date is nothing short of remarkable, but not surprising once you meet the team and the influencers associated with the brand. We love what they stand for and we can’t wait to work together and explore further projects and brand collaborations with Rolandy, Domenico, Irvin and the rest of the Belle Fleur team. These guys are solid, are true to the plant, true to the culture and will have a positive impact with their awesome genetics and entrepreneurial spirit”

Domenico Cardarelli, Belle Fleur CFO, added, “In AUSA we have found a partner that is the perfect complement to Belle Fleur in many ways. Through ALPS we will be able to develop a facility that will be the benchmark in cannabis production in Massachusetts, enabling us to grow products to our very exacting standards, while at the same time ensuring our production costs are among the lowest in the industry. That provides us with a massive competitive advantage. Furthermore, the agreement with Audacious will provide us with an anchor customer, an important signal to the market and investors. We look forward to completing our construction project and providing the people of Massachusetts with a new experience that was not accessible to them previously.”

Massachusetts Cannabis Market

With a population of 6.9 million, Massachusetts is the 15^th most populous U.S. state and has legalized both medical and adult use of cannabis. Currently, the state has only approved approximately 1 million square feet of cultivation. With an estimated demand of approximately $1.1 billion by 2024¹ this means that despite the anticipated expansion, cultivation will continue to operate at a premium in the state, positioning Belle Fleur and Audacious to capitalize on this opportunity. Average wholesale prices for indoor grown cannabis remain very strong in the state at approximately $4,200 per pound for flower, with a derivative price point equivalent to north of $6,800 per pound.

Rolandy Romelus, CEO and Co-Founder

While running his record label, Rolandy, CEO of Belle Fleur, noticed the strong link between rappers and cannabis and decided to launch his own brand. He set to create an inclusive brand experience that encompassed the entire culture and lifestyle, which resulted in the founding of Rapper Weed.

“Three things set us apart from other cannabis companies in Massachusetts: our genetics, a relentless focus on quality, and an inclusive approach to lifestyle and the culture. While we were very successful in California with our brand, we believe in giving back to the community that we come from and decided to take our brand back to Boston and introduce Massachusetts to the lifestyle and our products. The partnership with AUSA/ALPS enables us to do this and we are very excited be working with Terry Booth and the Audacious team and execute on our vision in Massachusetts and potentially other U.S. states as well.”

He continued, “Like the industry as a whole owes a huge debt to the advocates who have fought to have cannabis become socially acceptable and legally permitted at the state level, I owe a huge personal debt to my close friend Shezi Rosewood, who no longer is with us. He introduced me to the people that made things happen in the industry, he was a great help in me understanding what this industry is about, and he helped me to become the success I am today. He used to say something that I think describes how we approach business more clearly than anything else I have heard – “Nobody has to lose, for us to win”. That’s the truth, that’s Rapper Weed, that’s Belle Fleur and that’s the philosophy underlying this new partnership with Audacious Brands.”

Domenico Cardarelli, CFO

A Philadelphia and East Coast native, with over 10 years in his primary profession in the real estate industry, Mr. Domenico Cardarelli has laid the groundwork essential to becoming a leader in the cannabis industry. Having successfully closed over 400 sales, from wholesale and multi-unit rentals to ground-up developments, his experience has been well received since he has transitioned into the cannabis Industry. Domenico’s role with Belle Fleur Holdings LLC is Chief Financial Officer. He attended college at The Pennsylvania State University and Temple University Fox School of Business & Management.

Mr. Cardarelli concluded, “Belle Fleur is set up to become a success in Massachusetts and beyond. The partnership with Audacious enables us to execute on our vision and introduce our philosophy to new audiences.”