Peak partners with Boston Beer Company to develop, produce, and distribute cannabis-infused beverages in Canada
Highlights:
- Peak Processing Solutions (Peak), subsidiary of Althea Group Holdings (ASX: AGH) (Althea) has entered into agreements with BBCCC, Inc., The Boston Beer Company (NYSE: SAM) ('BBC'), and WeedMD Rx Inc., a subsidiary of Entourage Health Corp. ('Entourage')
- Under the product development agreement, Peak will provide research and development services including laboratory support and the testing of various product formulations and recipes, for the new line of BBC products
- BBC will provide Peak with funding of up to USD$2m for capital improvements associated with the development project. In addition, Peak will receive a minimum of USD$285,000 for each year of the Term of the agreement (totalling USD$1.42m)
- Under the 5 year supply and manufacturing agreement, Peak is the exclusive manufacturer of all cannabis beverages produced or sold in Canada under BBC branding, for the term of the agreement
- Entourage will be responsible for distribution and sales of the cannabis-infused beverages in Canada
TECUMSEH, ON, Aug. 31, 2021 /PRNewswire/ - Peak Processing Solutions, a subsidiary of Althea Group Holdings Limited (ASX: AGH), ('Peak' or 'the Company') is a leading developer, manufacturer, and distributor of cannabis infused edible, topical, and concentrate products is pleased to announce that the Company has entered into agreements with WeedMD Rx Inc., a subsidiary of (TSXV: ENTG) (OTCQX: WDDMF) ('Entourage') and BBCCC, Inc., a subsidiary of the Boston Beer Company Inc. (NYSE: SAM) ('BBC').
The parties have entered into various agreements in connection with the development, production, marketing, distribution and sale of non-alcoholic cannabis-infused beverages in Canada. The terms of the agreements are five years. ('the Term')
Supply and manufacturing agreement
Under the supply and manufacturing agreement, Peak will be the exclusive manufacturer of all cannabis beverage products produced and sold in Canada under BBC branding for the term of the agreement, with a right of first refusal to a U.S. potential future partnership.
Entourage will purchase the finished products from Peak, and leverage its sales force and sales licences to market, distribute and sell the products in Canada on behalf of BBC.
Development Agreement
Under the development agreement, Peak will provide research and development services, including laboratory support, for the purposes of developing new products and testing various product formulations and recipes, all activities to be completed at Peak's facility in Tecumseh Ontario.
BBC will provide up to USD$2m to fund capital expenditure costs associated with matters including the construction and furnishing of laboratory facilities and additional production-related equipment at the Peak facility, with no less than USD$500,000 to be committed to enhancing Peak's beverage manufacturing capabilities.
In addition, BBC will pay Peak a commitment fee of USD$285,000 for each year of the term of the agreement, payable in equal monthly amounts and reduced according to total product sales in the preceding month. The total commitment fee over the term is USD$1.42m.
Peak's Founder & President Gregg Battersby said: "We are excited to partner with like-minded companies that see the need for true innovation in the space. This three-way partnership is the recipe for success through investment into innovation and pushing the status quo of cannabis infused products." He continued, "As we expand on and further solidify our working relationship with Entourage, we are humbled that an established innovator such as Boston Beer appreciates the unique capabilities and competitive advantage that Peak offers its partners, and has committed to invest in multiple facets into a long-term partnership"
BBCCC, Inc. Head of Cannabis Paul Weaver said: "Peak has built a world class facility in Canada, with the right staff and systems in place to ensure every drink is of the highest quality. Entourage is one of Canada's oldest and most respected regulated cannabis cultivators. Their unwavering commitment to quality is exactly what we look for in our partners. We are excited to begin making some amazing drinks together."
Entourage CEO and Executive Chair, George Scorsis said: "We're thrilled to be collaborating with Boston Beer and Peak to produce, market and sell the next generation of cannabis-infused beverages to discerning consumers looking for alternate consumption choices. Leveraging our collective industry expertise together with Entourage's cannabis research and advanced branding strategies will establish our product portfolio with another unique offering. In addition, this provides an opportunity to further explore our collective reach into international markets."
Cannabis Innovation. Brand Elevation
Peak Processing Solutions
Peak Processing Solutions, a wholly owned subsidiary of Althea Group Holdings Ltd (ASX:AGH), is a full 360-degree recreational and medical cannabis licenced producer, specializing in the formulation and production of innovative cannabis products. Operating from a purpose-built state-of-the-art 3,716 square metre facility in Ontario, Canada, Peak offers its partners access to a broad range of cannabis production capabilities that enable the development of products and brands that can capitalize on the rapidly growing Canadian recreational and medical cannabis markets.
SOURCE Peak Processing Solutions
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