Alternate Health Corp. (CSE: AHG) (OTCQB: AHGIF) has agreed to launch operations at a state-licensed 60,000-sq.-ft. cannabis extraction facility in Adelanto, Calif. The company signed two agreements to get access to into cannabis manufacturing.
Alternate Health agreed to acquire 100% stake in DTS Lab Services, including the company’s assets, equipment and intellectual property.
DTS is a cannabis extracts company with over eight years of experience operating in California’s medical cannabis industry.
As consideration for the purchase, an initial 250,000 Alternate Health common shares will be issued to DTS along with a $48,240.84 reimbursement for equipment costs and other expenses. The deal includes additional 600,000 common shares for DTS as performance-based incentives.
Alternate Health intends to bring DTS under the umbrella of a new subsidiary called Alternate Extracts. DTS’s founder Keyan Shokraie will continue to work with Alternate Health as the manager of the Adelanto facility.
Under the agreement with Genesis Integral and Professorganix, Alternate Health becomes a 55% owner of each company, responsible for managing extraction of hemp and cannabis at two locations in Adelanto.
Alternate Health signed an agreement with two California cannabis companies to expand, build-out and manage the Adelanto facility. The company will take a 55% stake in both companies in return for providing equipment and managing operations, including producing wholesale extracts and manufacturing Dank Tank-branded products.
Alternate Health plans to begin CO2 extraction immediately following the relocation of DTS’s assets and equipment to the Adelanto facility. The company plans to expand production to maximize capacity throughout the 60,000 sq. ft. of already state-licensed space.
Leasehold improvements and equipment ordering are underway to expand production to include distillation, ethanol-based extraction and on-site remediation and decontamination.
Both agreements are set to close on the equipment delivery date at the Adelanto facility that is expected in the third week of April 2019.