Red White & Bloom Completes Platinum Vape Management Transition, Reduces $12.5M of Liabilities

Red White & Bloom Brands Inc. RWB RWBYF announced Monday it has completed an agreement for the transition of the management at its Platinum Vape, LLC acquisition and group of companies, had settled all additional PV acquisition purchase price

consideration and redeemed $5 million of convertible debentures that were previously convertible at $0.57 per share.

What happened

The former owners of the Platinum Vape Group and RWB executed an agreement under which the parties agreed to a transition plan, including their resignations as directors and officers from all RWB entities, as well as a waiving of any further consideration as it pertains to the potential earn-out that formed part of the original purchase consideration, which was previously recorded as a US$7.5 million liability on the company’s financial statements.

Under the deal, the company facilitated the private purchase of $10 million of convertible debentures, representing the balance of the debentures, with an arm’s length institutional investor.

“Platinum Vape experienced unprecedented growth over the last couple of years, and our acquisition of PV last year was a watershed event for RWB,” stated Brad Rogers, Red White & Bloom CEO and chairman. “In addition to the current changes, we expect the further transition for management of the PV segment into a state-specific focus will allow for the expansion of the brand to each state in which RWB operates, while facilitating compliance for the regulatory and marketing nuances that are unique to each jurisdiction.”

Rogers added, “We continue to strengthen our balance sheet with the elimination of any additional consideration payable related to the acquisition of PV, including elimination of the US$7.5 million earn-out payment -- currently booked as a liability on the balance sheet, which could have been up to US$25 million if certain sales milestones were met -- and redemption of the US$5 million of convertible debentures.”

RWB’s new management appointments include:

  • Shea Alderete and Joaquin Rodriguez have been brought on board as co-general managers of RWB California's day-to-day operations.
  • Craig Rosevear has been appointed RWB West US Regional Controller.

More recent news from RWB:

Red White & Bloom Brands Launches Grow Operations, Obtains Grow License At Apopka Greenhouse

Red White & Bloom Brands Refinances Roughly $19M Of Short-Term Debt

Red White & Bloom Florida Facility Ready To Produce Edibles

Red White & Bloom Receives Final Approval To Launch Adult-Use Cannabis Sales In Michigan

Price Action

Red White & Bloom’s shares closed Friday market session 4.45% lower at 65 cents per share.

Photo: Courtesy of Elsa Olofsson on Unsplash

 

 

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