Article by Financial Post
Halo Labs Inc. (“Halo” or the “Company“) (NEO:HALO; OTCQX:AGEEF, Germany:A9KN) is pleased to announce that the Company has entered into a Letter of Intent (the “LOI”) dated August 3, 2020 to establish a joint venture and strategic alliance with Terphogz, LLC, doing business as Zkittlez™ (“Zkittlez”). The joint venture will establish and operate a state- and locally licensed commercial cannabis cultivation facility at Ukiah Ventures Inc. (UVI). Halo and Zkittlez plan to jointly operate this large indoor grow.
The proposed joint venture (the “Zkittlez JV”) will combine Zkittlez™ world-famous genetic strains and growing acumen with Halo’s processing, manufacturing and distribution strengths to bring a range of top-shelf products to the California market.
The proposed Zkittlez™ JV is an 18,000 square foot project in which Halo plans to start the buildout in last quarter of 2020 and to complete the build-out by mid-2021, utilizing Halo’s working capital line.
The joint venture will produce and manufacture cannabis products, using Zkittlez™ existing proprietary cannabis genetics, under Halo’s various licenses in California. The collaboration will then distribute these genetics in various cannabis products in California, under Zkittlez’s existing brand and strain names, as well as jointly developing and commercializing new and unique cannabis genetics in the heart of Mendocino, California.
Jon Orantes, Managing Director of Zkittlez™, describes how the joint venture makes sense for his company: “Obviously we’re really excited about the project. Terphogz are considered a top breeding group; and we’ve found it challenging to compete in the California space without a large-scale indoor production of our own. The combination of our brand popularity in California, and Halo’s resume of being serious operators who can bring the needed infrastructure, is a winning formula. We are glad to have this opportunity to reach more of the market with our products and bring the Zkittlez movement to the next level!”
Halo’s CEO, Kiran Sidhu, opines: “We have the space at UVI; and the Zkittlez™ team understands how to run a large indoor grow facility. This is truly a perfect combination that should lead us on a very successful path. By choosing Terphogz as our partner, we will ensure that we start with the best raw materials, leveraging our extraction, manufacturing and product development operations with a leading brand-name and strains, such as Zkittlez™ and others in the Zkittlez™ family. We look forward to expanding the reach and accessibility of Terphogz genetics through all our lines, including our new edible products. Running this facility should bolster Halo’s revenue and operating profit. This collaboration will strengthen our vertical supply chain in California.”
Zkittlez™ is a renowned cannabis breeding group responsible for the famous Zkittlez™ variety of cannabis. Terphogz, LLC owns a genetic library including the famous Zkittlez™ cannabis variety, as well as many others, such as Zmoothie, Brain Candy, Z3, and Hindu Zkittlez™. Zkittlez™ has a unique and distinct terpene profile, unlike other genetics in the market, making it distinguishable from all other strains.
Zkittlez™ products typically command a 20% or greater pricing premium, compared to similar products in the market. Zkittlez™ brand value and recognition for creating top-tier cannabis products places the brand on shelves alongside industry leaders, such as Cookies and Connected.
Founders of the Terphogz/ Zkittlez™ brand, Green R. Fieldz and Tony Mendocino, are known worldwide and have over 200,000 followers on social media. Zkittlez™ and its genetic crosses are some of the most sought-after and desirable strains in the cannabis industry. They have won many awards in multiple categories, including numerous 1st places at competitions such as Chalice and The Emerald Cup, as recently as 2019.
Halo is a leading cannabis cultivation, manufacturing, and distribution company that grows, extracts and processes quality cannabis flower, oils, and concentrates, and has sold over five million grams of oils and concentrates since inception. Halo continues to evolve its business by delivering value with its products. Current growth includes verticalization in key markets in the United States and Africa, with planned expansion into European and Canadian markets. With a consumer-centric focus, Halo markets innovative, branded, and private-label products across multiple product categories.