FinCanna Capital Corp announced that its portfolio company, QVI Inc., a cannabis-infused product manufacturer located in Sonoma County, California and doing business as “The Galley”, has completed the build out of its co-manufacturing facility and has been issued its California Cannabis Manufacturing License Type N, by the Manufactured Cannabis Safety Branch, CA Department of Public Health. The Type N licenses permits “The Galley” to manufacture, package and label all cannabis infused products.
The Galley is an 8,300 square foot state-of-the-art co-manufacturing facility designed to meet the highest Food and Drug Administration and California Dept. of Public Health standards. The facility is built to FDA and CDPH standards and is focused on high demand areas of production; Edibles, Topicals, Tinctures, Chocolates, Hard Candies, Gummies, Beverages, Vapes, Pre-Rolls and Flower Packaging.
Having received its state manufacturing license, The Galley team expects to be shipping finished products to the market within the next four to six weeks.
Annie Holman, Co-Founder of QVI said, “Receiving our manufacturing license is a major victory for the Galley, and we are excited to now be open for business. We designed and built the Galley to be the premier co-manufacturing facility in California, offering true one-stop shopping for both in and out-of-state brands. Our client list is substantial, and we will be onboarding them as quickly as we can, which positions us for strong growth. In addition, and unlike other sectors of the cannabis market, there is significantly less competition from the ‘black market’ for the edibles that we produce.”
“This is a major milestone for the QVI team and for FinCanna shareholders,” said Andriyko Herchak, CEO of FinCanna Capital. “QVI is very well positioned to capitalize on a growing market opportunity for high-quality cannabis infused products as evidenced by the strong demand for their services. The Galley delivers exceptional benefits to brands seeking to expand their product offerings and growth prospects across California. We applaud QVI’s efforts and look forward to a prosperous future for The Galley as well as a significant source of recurring and increasing royalties for FinCanna.”
Under the Royalty Agreement, FinCanna will receive a tiered corporate royalty, adjusted based on revenues, ranging from 15% to 6% of QVI’s total revenues, with the top royalty rate of 15% on the first US$20 million of annual sales until cumulative royalties to FinCanna of US$10 million are achieved. In addition, FinCanna is entitled to earn a Supplemental Payment, when coupled with the royalty, will now ensure FinCanna receives a minimum of 35% of the annual after-tax net income from QVI. The supplemental payment will accrue annually and be paid out upon certain triggering events, including a change of control, an initial public offering or certain other specified events of QVI.