WOODLAND HILLS, Calif., Jan. 29, 2014 /PRNewswire/ -- GrowLife, Inc. (OTCBB: PHOT), a diversified company operating in the legal cannabis industry which develops, markets and deploys products and services of legal cannabis, is pleased to announce that Organic Growth International, LLC ("OGI"), its previously announced joint venture with CANX USA, LLC, has entered into a series of agreements with CEN Biotech, Inc., subject to the approval of the GrowLife Board of Directors. GrowLife currently has a 45% ownership interest in OGI, with conditions under which it can gain majority interest.
CEN Biotech, working under the inspection and authority of Health Canada, has completed the extraordinary governmental processes in Canada to receive approval to begin constructing their state of the art medical marijuana facility in the City of Lakeshore, Ontario, Canada. The facility has undergone extensive vetting by authorities to ensure strict compliance and facility security requirements of Canadian Government and provincial requirements in Canada. Importantly, the facility has been graciously embraced by the town of Lakeshore and the Windsor Essex Economic Development Authorities as a most desirable source of jobs and economic activity for this highly agricultural region. This production facility is expected to have the capacity to produce up to 1.3 million pounds of dried medical marijuana annually, and the total may include capacity that is set aside for import and export. While facility construction has commenced, as of the date of this release CEN Biotech has to next secure the final and formal permissions to grow, harvest, package, and sell medical marijuana in Canada or for export.
Through a series of agreements, OGI facilitated a 25% equity position in CEN Biotech which is in addition to the ownership interest in certain licensing fees from CEN Biotech held through OGI, along with a shared right to revenue sharing of 7.7% of all gross payments received by CEN Biotech. In addition, GrowLife and its affiliates will serve as CEN Biotech's exclusive supplier of legal cannabis growing equipment for the entire term of the shared ownership, subject to certain limitations. Furthermore, if and when CEN Biotech achieves cumulative manufacturing and sales volume of one million pounds of cannabis, OGI will be entitled to a $100 million payment. In exchange for the rights listed above, and others, GrowLife will issue to designated CEN Biotech shareholders a total of 235,294,118 shares of restricted GrowLife common stock, the equivalent of $40 million at $0.17 per share, after CEN Biotech is formally approved to produce and harvest cannabis by the appropriate Canadian authorities. The shares will be issued only if CEN Biotech receives final approval to grow and sell marijuana as currently planned, which means any issuance will likely be months in the future and closer to when there are revenue opportunities for CEN Biotech and therefore GrowLife. If these shares are ultimately issued, GrowLife will be obligated to register them under applicable federal and state securities laws. This contingent issuance is also subject to the GrowLife shareholders increasing the authorized common stock at the upcoming special meeting of shareholders.
"The agreement represents an outstanding beginning for GrowLife's newly expanded business model and entry into lucrative global market sectors in legal cannabis," stated Sterling Scott, CEO, GrowLife Inc. "The scale of the planned operations is truly unprecedented for legal cannabis worldwide as the facility has been proposed and is under construction for a production capacity of up to 1.3 million pounds of dried medical marijuana annually. We are extremely pleased to participate in this tremendous revenue opportunity for GrowLife and its shareholders which we believe clearly installs GrowLife as one of the foremost cannabis related companies on an international level.""When we were provided with the opportunity to potentially provide these services in Canada our team realized that we needed the additional support and expertise of an elite cannabis company with the assets, technology, and intellectual capital to see our dream through to reality," stated Bill Chaaban, President and CEO, CEN Biotech. "In GrowLife we have found that ideal partner." A full 8k detailing the Agreement will be released within the allowed time period. A GrowLife Investor Presentation can be viewed online at http://growlifeinc.com/growlife-presentations-october-2013/ From time to time, GrowLife will provide market updates and news via its websites GrowLifeInc.com, Cannabis.org or the Company's Facebook page at https://www.facebook.com/tellthetruthfederalgovernment About GrowLife, Inc. GrowLife, Inc. ( PHOT) ( www.growlifeinc.com) develops, markets and deploys products and services addressing the needs of legal cannabis growing and retail operations, including hydroponic growing equipment and retail support software. The Company provides these solutions in our nationwide retail network, as well as online sites Greners.com, Phototron.com and 58Hydro.com. The Company also operates the political and social forum, Cannabis.org About CEN Biotech CEN Biotech, Inc. was established in 2013 as a partially owned subsidiary of Creative Edge Nutrition (OTC Pink: FITX) for the sole purpose of supplying the Canadian public with pharmaceutical-grade medical cannabis under the newly established Marihuana for Medical Purposes Regulations (MMPR) CEN Biotech Inc. has submitted a comprehensive application to become a licensed producer (LP) of dried marihuana for medicinal purposes and has received a ready-to-build approval from Health Canada.