Calgary, Alberta--(Newsfile Corp. - August 31, 2021) - Discover Wellness Solutions Inc. (CSE: WLNS) (formerly RMMI Corp.) ("Discover Wellness", "DWS" or the "Company") , a licensed producer and processor under the Cannabis Act (Canada), has filed its Q2 2021 financial statements on SEDAR.
The Company wishes to clarify the volume of hemp it has purchased from SynerGenetics Bioscience Inc. ("SG"). In December 2020, Discover Wellness took possession of 550,000 lbs of high-CBD hemp from SG. The SG hemp purchase agreement has been completed as it relates to the volume of hemp to be purchased from SG and no other hemp is planned or required to be purchased from SG. The condition in the SG hemp purchase agreement that SG sell and DWS purchase a minimum 1,100,000 lbs of high-CDB hemp biomass has been waived as no other SG hemp is available to sell and purchase.
The Company, having fulfilled its purchase obligations with SG, can now partner with farmers directly to cultivate high-CBD industrial hemp using SG seeds. This provides the Company more flexibility on selecting its own farming partners. The Company has not engaged in any hemp farming activities for the 2021 cultivation season. The Company will consider its industrial hemp cultivation needs before the 2022 cultivation season.
Update on Quad Play Memorandum of Understanding
DWS is pleased to provide an update on the Quad Play memorandum of understanding announced on March 2, 2021. At this time, Quad Play has received conditional approval from the Thailand authorities to import industrial hemp seeds. DWS, along with SG, is obtaining certain reports and permits required by the Thailand authorities and Canadian authorities to export industrial hemp seeds to Thailand. The timing of the reports and permits are uncertain as this is the first time that the Company has undertaken these activities and timing relies on availability and attention of third parties, including the Government of Canada, which is hard to predict.
Update on hemp biomass sale
Further to the Company's April 8, 2021 announcing a first sale of hemp biomass to a licenced third party, the sale to that third party has been deferred. The sale was deferred initially due to logistics issues with shipment and then further deferred due to lack of immediate need by the third party. The hemp that was earmarked for this third party has now been shipped to a licenced processor under a revenue sharing arrangement. The processor is expected to process the hemp into CBD products and both the Company and the processor will market the CBD products for sale. The Company and the processor will share the revenue from the sale of CBD products. The timing and amount of revenue to the Company is uncertain at this time as there are many factors that will affect this including when the processor will be able to fit the biomass into their processing schedule, the yield of CBD products, the quality of the CBD products and the market for CBD products at the time of sale.