8-K: CryoMass Technologies Announces CryoSift Separator Sale and Licensing Agreement in Oklahoma

CryoMass Technologies Inc. has sold a CryoSift Separator and licensed its cryogenic refinement technology to Tribe Collective and Choctaw Processing in Oklahoma, projecting potential recurring revenues exceeding $1,000,000 per annum.

Summary

• CryoMass Technologies Inc. announced the sale of a CryoSift Separator to Tribe Collective, with shared usage by Choctaw Processing, both established cannabis operators in Oklahoma.
• The sale includes non-exclusive patent license agreements for CryoMass's patented process with Tribe and Choctaw.
• The agreements include one-time revenue from the sale of the unit and recurring revenues from processing fees based on biomass volume over the duration of the at least five year patent licenses.
• Recurring revenues to CryoMass in connection with this transaction could exceed $1,000,000 per annum, depending on certain factors.
• The sale was facilitated through third-party financing provided by NEC Financial Services, LLC.
• CryoMass's technology enables significant cost reductions and improved extraction efficiency for Tribe and Choctaw.
• The shared-usage model could serve as a template for future deployments in other markets.
• CryoMass's technology reduces biomass volume up to 80%, lowering storage, handling, and transportation costs.
• The resulting CryoSift concentrate is a superior product compared to unprocessed biomass, preventing potency and terpene degradation.

Sentiment

Score: 8

Explanation: The announcement is positive due to the sale of equipment, licensing agreements, potential for significant recurring revenue, and expansion of the financing partner network. The company is also expanding into a new market.

Positives

• The sale of the CryoSift Separator and licensing agreements generate both one-time and recurring revenue for CryoMass.
• The potential for recurring revenues exceeding $1,000,000 per annum is a significant financial benefit.
• The shared-usage model could be replicated in other markets, expanding CryoMass's reach and revenue streams.
• The technology reduces biomass volume up to 80%, lowering storage, handling, and transportation costs for customers.
• The involvement of NEC Financial Services, LLC expands CryoMass's financing partner network.

Risks

• The forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially.
• The cannabis industry is subject to significant legal restrictions and regulations, particularly in the United States.
• Marijuana remains illegal under federal law in the U.S., which could impact CryoMass's operations and financial transactions.
• Changes in the regulatory environment affecting the sale and use of cannabis or hemp products could impact the company.
• Demand for the company's products, internal funding and the financial condition of the company could impact the company.

Future Outlook

CryoMass aims to revolutionize biomass refinement, deliver long-term value to customers, and establish a recurring revenue model that supports continued innovation and growth. The shared-usage model could serve as a template for future deployments in other markets.

Management Comments

• Christian Nol, CEO of CryoMass, stated that the transaction demonstrates how their technology can create immediate value for multiple operators within a competitive market.
• Christian Nol, CEO of CryoMass, stated that by enabling significant cost reductions and improved extraction efficiency, their solution provides Tribe and Choctaw with compelling competitive advantages.

Industry Context

This announcement highlights the increasing adoption of advanced technologies in the cannabis industry to improve efficiency and reduce costs. The partnership between CryoMass, Tribe, and Choctaw demonstrates a collaborative approach to leveraging innovative solutions in a competitive market.

Comparison to Industry Standards

• CryoMass's technology, which reduces biomass volume by up to 80%, positions it as a leader in post-harvest processing efficiency.
• Companies like Aurora Cannabis and Canopy Growth have also invested in advanced extraction technologies, but CryoMass's cryogenic refinement approach offers a unique value proposition.
• The recurring revenue model based on processing fees aligns with industry trends towards subscription-based services and long-term partnerships.

Stakeholder Impact

• Shareholders may benefit from the potential increase in revenue and profitability.
• Employees may benefit from the company's growth and expansion.
• Customers (Tribe and Choctaw) will benefit from improved efficiency and cost reductions.
• Suppliers may benefit from increased demand for CryoMass's products and services.
• Creditors may benefit from the company's improved financial performance.

Key Dates