MONTREAL, June 17, 2021 /CNW/ – The Good Shroom Co Inc. (the “Company” or “TGSC“) (TSXV: MUSH), is pleased to announce that its wholly owned subsidiary, Teonan Biomedical Inc. (“Teonan“), has received authorization from Health Canada to commence the sale and the distribution of its beverages which are Canada’s first cannabis infused beverage line made with functional mushroom extracts.
Teonan holds a micro-processing license delivered by Health Canada under the Cannabis Act, which allows it to manufacture and develop topicals, extracts and edible cannabis products which includes beverages. Before sales of the Velada beverages could commence, Teonan was required to demonstrate its finished products and quality control procedures complied with Health Canada’s strict guidelines. Teonan’s micro-processing license was amended by Health Canada allowing it to distribute the Velada products nationwide, through various provincial retailers, including the Société Quebecoise du Cannabis (SQDC) which is Canada’s largest provincial cannabis retailer. A micro-processing license has an annual cannabis extract processing limit of 150,000,000 mg per year. With Health Canada’s limit of 10 mg of THC per unit, this equals up to 15,000,000 units containing THC which can be sold yearly. The Company has strategically chosen a micro-processing license instead of a standard processing license due to the high cannabis processing limit with the reduced cost associated to maintaining this type of license.
Velada is the first mushroom-based instant wellness beverage in Canada which contains cannabinoids. The beverage mixes which come in powdered form are vegan, dairy free, GMO free, gluten free and all contain 100 mg of functional mushroom extracts and a 30 mg dose of CBD per serving. The Company will also be offering a low THC version of the beverages with a 2:1 CBD:THC ratio for optimal effectiveness, with 4.5mg of THC and 9 mg of CBD per serving in order to have an expanded and versatile offering to appeal to a wider variety of customers. Flavours available for distribution include hot chocolate, coffee and golden milk latte. The Company anticipates expanding the Velada product line with additional flavours and products following market response and emerging industry trends. This authorization to begin sales also allows the company to initiate its agreement with its sales broker Velvet Management Inc., Canada’s leading cannabis sales agency, which represents the company across Canada.
“We have been eagerly awaiting this authorization and we are ready to move forward” stated Eric Ronsse, the Chief Executive Officer of TGSC. “With relatively few established beverage suppliers and high barriers to entry, we expect the quality of our product, the variety of the offering and attractive price point, will allow us to capture a share of the market and build a strong and loyal consumer base.” In Canada the cannabis-infused beverage market is estimated at $529 millioni per year.
In connection with the receipt of the authorization, the Company will issue 1,000,000 common shares to Mr. Scott Jardin, it’s Chief Financial Officer, as per the terms of a performance share agreement (the “Agreement”) entered into in September 2020. Under the Agreement, Mr. Scott is entitled to receive 1,000,000 common shares upon receipt of all regulatory permits and authorizations required for the commercialization of the Velada products. Mr. Jardin can earn additional tranches of common shares (maximum of 2,000,000) when the Company reaches targeted sales for the Velada products in the next 12 months. All shares issued pursuant to the Agreement are subject to a hold period until April 15, 2022, in addition to the escrow requirements of policy 5.4 of the TSX Venture Exchange which provides for a release over 36 months starting April 26, 2021 (please see Filing Statement available at www.sedar.com for details on the agreement and escrow release schedule).
About the Company
TGSC’s mission is to build clean label brands that are synonymous with functionality, flavour and quality, rooted in a company recognized for having a socially responsible approach. Through its wholly owned subsidiary, Teonan, it manufactures and sells functional beverages under its two brands: Teonan and Velada. Inspired by the relationships ancient cultures held with mushrooms and in line with growing consumer trends towards functional foods, Teonan created the instant beverage lines using a custom blend of organic mushroom extracts chosen for their known health benefits, all the while keeping the focus on developing delicious flavors.” All of Teonan’s instant beverage mixes are certified organic (Ecocert – USDA), vegan, dairy free, GMO free and gluten free. Teonan began direct to consumer sales of the Teonan beverages in North America, in December 2019, via its online stores and sales of the Velada beverages to authorized retailers is expected to commence in the coming weeks.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the Exchange) accepts responsibility for the adequacy or accuracy of this release.
SOURCE The Good Shroom Co Inc.
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