Exactus buys Colorado hemp product producer Panacea Life Sciences in stock deal

Exactus Inc (OTCQB:EXDI) has announced the acquisition of Panacea Life Sciences Inc, a producer of legal, trace THC, hemp-derived cannabinoid products for consumers and pets. 

Panacea, founded in 2017 by Leslie Buttorff, operates a 51,000-square-foot cGMP (current good manufacturing practice)-certified facility in Golden, Colorado and PANA Botanical Farms in western Colorado, complete with fully integrated extraction, manufacturing, testing and fulfillment. 

The company produces soft gels, gummies, tinctures, sublingual tablets, cosmetics and other topicals for purchase online, in stores and at smart kiosk vending machines being rolled out nationally.  

READ: Exactus hits profitability, posts tenfold revenue growth in 3Q results

In consideration for the transaction, Exactus issued 1 million shares of Series C convertible preferred stock, 1,000 shares of Series C-1 convertible stock, 1,000 shares of Series D convertible preferred stock and more than 473 million shares of common stock.

Panacea also founded the Cannabinoid Research Center at Colorado State University and supports medical studies designed to evaluate the effects of cannabinoids in human health and wellness, the company said. The company attracted significant early investment, including $14 million from 22nd Century Group, which recently went on to sell its Panacea stock for an 11.6% stake in Exactus. 

“Our focus on quality and traceability are the hallmarks of Panacea’s seed-to-sale strategy,” Buttorff said. “From our state-of-the-art CO2 extraction, chromatography equipment and product manufacturing lines, we can produce as much product as we need to meet our sales goals for the foreseeable future.” 

“We first entered the CBD arena with a world-class SAP (systems applications and products)-based ERP (enterprise resource planning) system developed for the cannabis industry by Quintel Management, which tracks the full chain of custody for every product, as well as provides all back-office and production planning capabilities. We believe this sets us apart from the majority of hemp farms and CBD companies.”

Buttorff is also CEO of an SAP consulting firm, the company said.

“Seeing the utter chaos that permeates the emerging cannabis and hemp industry, accurate supply-chain accounting and reporting is crucial to our success,” she continued. “Unlike other companies, we set out to set the industry standard for compliance and reporting, which has been rewarded with our successful partnership and investment in joint technology with 22nd Century.”

Additionally, Larry Wert has resigned as Exactus chairman, but he will remain on the company’s board of directors.

“Since the beginning of 2021, we have focused on restructuring and properly positioning the company to execute a strategic acquisition. We are thrilled to have met Leslie Buttorff and the Panacea team as they have developed a real gem of a CBD company.” Wert said.

“Throughout this process, we have evaluated many companies, and Panacea has proven to be superior in all aspects. We are pleased to provide our loyal shareholders this opportunity to continue in the CBD arena. I would also like to thank Exactus’ founder and investor Harvey Kesner and Andrew Johnson, who provided invaluable insight and support throughout our difficult transition year and in connection with the Panacea transaction.”

In connection with the closing, Johnson resigned as an officer of Exactus but will continue on with Panacea to assist with investor relationships, the company said.

Contact Andrew Kessel at [email protected]

Follow him on Twitter @andrew_kessel

Story by ProactiveInvestors