LAS VEGAS, Sept. 17, 2019 /PRNewswire/ -- PRESS RELEASE -- GB Sciences, Inc. on Friday, Sep. 13, 2019, filed an 8k announcing the sale of its 50-percent ownership stake in GB Sciences Louisiana, LLC. The stake will be purchased by Wellcana Plus LLC, affiliated through its managers with the group which holds the other 50 percent of the Louisiana operations. Expected to close by the end of October 2019, the sale is for $16 million to GB Sciences, $7 million in cash at closing, $1 million in cash within 60 days of closing, and the remaining $8 million as an earn out. The actual proceeds realized through the earn out and the timing of those proceeds will depend upon the profitability of the Louisiana operations.
The sale will greatly reduce the current and future burn rate of the company and allow it to focus on achieving profitability, seeking a DEA license, and implementing GMP, a set of regulations promulgated by the U.S. Food and Drug Administration to ensure quality control in the manufacture of pharmaceuticals, dietary supplements and natural health products among other substances, at its Las Vegas, Nev. location. GB Sciences also will continue to develop its clinical cannabis formulations for which the company has filed numerous patents, progressing the research towards clinical trials and first-in-human pilot studies.
GB Sciences and GB Sciences Louisiana will endeavor to collaborate on research and clinical trial opportunities, and the company will grant GB Sciences Louisiana the opportunity to license the company's proprietary formulations for use in research and final formulations upon mutually agreeable terms.