CROP Infrastructure Corp (CSE:CROP) (OTCMKTS:CRXPF) announced Thursday that Elite Ventures Group, in which it owns a 49% stake, has struck a deal to provide $89.5 million worth of cannabidiol isolate to Bioscience Enterprises Inc.
The sale will generate about $43 million for CROP in proportion with its stake in the company. Delivery is scheduled to begin in November and last through March 2020. Biosciences can elect to extend the deal an additional two months for an extra $38 million.
Shares of CROP grew nearly 4% to C$0.27 in Toronto and 2% to US$0.20 on OTC markets.
Elite operates a 2,200-acre CBD farm in Nye County, Nevada. Its 2019 crop is expected to produce hemp with CBD between 10% and 20%. The CBD will be sold in conjunction with Elite Ventures’ licensee The Hempire Company LLC.
CBD isolate is extracted from cannabis to achieve pure cannabidiol. It lacks tetrahydrocannabinol, THC, the psychoactive cannabinoid that produces a high.
In addition to $17.1 million per shipment, California-based Biosciences will pay a series of three deposits at the outset of the agreement, after 30 days, and upon completion. If, for whatever reason, Elite and Hempire do not deliver their first shipment, Biosciences can have the proceeds of their third deposit converted into CROP stock.
CROP paid an introduction feel of 1.3 million shares at a price of C$0.30 per share to a finder that brought the companies together. The company, based in Vancouver, is focused on building a portfolio of cannabis and real estate assets.
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