NEWS RELEASE

Canivate launches with plans to establish new standard for
clean, green and pure cannabis and hemp cultivation

State-of-the-art facility and automated growing system to produce safer, higher quality, environmentally friendly product.

Vancouver, B.C., Sept. 10, 2019 – Canivate Growing Systems Ltd. (www.thecanivateway.com), a start-up company that has developed a new and proprietary way to grow hemp and cannabis, launched today with plans to solve the environmental, product safety, and quality issues that plague this emerging commercial industry.

The North America-based company, which has raised $14.3M (Cdn) in funding, has developed an innovative proprietary, technologically advanced facility design and automated growing system called The Canivate Way. It dramatically reduces the energy and water requirements of traditional cultivation methods and eliminates the need for harmful agricultural toxins, while increasing crop yields and quality, to name just a few of its benefits. The patent-pending system creates, in effect, a perfect ecosystem and microclimate for USDA organic equivalent, naturally cultivated cannabis and hemp. As this higher grade of product begins to enter the market, the Company intends to establish a new industry standard for clean, green and pure products.

The first Canivate facility and campus will be based in Southern California, and the complex tensile membrane component of the structure, one of the company’s proprietary elements, will be built by PFEIFER FabriTec, an award-winning firm specializing in this type of construction. The company has built some of the most iconic structures around the world, including the “Bird’s Nest” National Stadium in Beijing, the Olympic Stadium in London, and the U.S. Bank Stadium in Minneapolis. The principals of PFIEFER FabriTec are strategic investors in Canivate.

For the Southern California campus, the first facility is set to be completed in late fall 2020.

Canivate has a unique business model. They do not act as the cultivator – in fact, they never touch the plant. Canivate identifies customers before locating and building a facility, and then leases the facility and growing system to an exclusive independent operator (EIO) for each state, pursuant to lease and licensing contracts. The EIO will be licensed in its local jurisdiction to engage in cultivation activities and will manage the facility and growing system using the Canivate IP. The EIO will work with commercial cultivators, while retaining control and management of the growing system process; allowing them to optimize yields and provide retailers with consistent, high-quality and environmentally friendly products. In addition, an offtake contract for each facility is put in place before it is built. This is done to provide high-profile brands – that have established distribution channels and retail outlets – with a consistent quantity and quality of product, which secures profitability for both the EIO and Canivate.

There are currently signed offtake agreements in place with renown cannabis companies such as EarthShaker, a cultivator for popular luxury brands like Beboe; and Commercial Grow Supply, the grower for popular brands including Big Mike and Cookies.

I have seen the future of cannabis cultivation and it is Canivate,” said Sevan Derohanian, CEO of Commercial Grow Supply. “Retailers desperately lack access to consistently high quality and ecofriendly product from their suppliers. Canivate has reimagined how growing systems should work, creating an optimal environment for amplified plant growth, higher crop yields, cultivated in a sustainable way.”

How it Works

Cannabis and hemp are traditionally cultivated outdoors, in greenhouses or in indoor facilities, all of which can carry significant environmental management, contamination and pest risks. The Canivate Way creates a new category of growing environment. It uses systems and procedures that deploy a combination of innovations in cannabis cultivation, optimizing results through automation and robotics, micro-environments, nanotechnologies and controls – all managed through the Internet of Things (IoT).

As a result, Canivate facilities use up to 90% less energy, 90% less water collection, 40% less fertilizer, and 50% less labor costs compared to traditional indoor grow operations. It also utilizes uniquely formulated nutrients and minerals to create a fertigation system that optimizes growth and produces USDA-equivalent organic plants.

A key element of the company’s IP is the building envelope. The California facility is expected to be the cannabis industry’s first fully sealed growing environment, developed to prevent the infiltration of pathogens, pests and other contaminants, while providing extreme odor control – along with the building’s energy efficiency gains.

The Canivate facility is designed to improve and optimize the ideal cannabis grow light spectrum by providing natural sunlight to stimulate robust plant growth. It is complemented with supplemental light as required to achieve the optimal combination of lighting for plant health and vigor. This is done in a fully controlled grow environment utilizing two technologies: the Canivate building envelope and supplemental grow lighting. The cultivation room walls and ceiling are a proprietary light-transmitting membrane, admitting the highest levels of beneficial full spectrum light, approximately 95%+ (between 500-1800 nanometers) – significantly greater than any other material, including clear glass. This membrane has very high tensile strength, is resistant to dirt and other elements, and is just 1% the weight of glass. When supplemental light is needed to achieve optimal lighting conditions, proprietary advanced LED lighting – specially designed for Canivate by a team that includes former NASA scientists responsible for growing plants on the International Space Station – delivers an optimal light spectrum and intensity for amplified growth to complement the sun’s spectrum. This provides a complementary light spectrum far exceeding any agricultural lighting fixture currently available in the market.

Temperature, humidity, air velocity and other environmental factors are managed for ideal conditions using IoT sensors and control systems. Micropropagation of plants using cell cultures eliminates pathogens and produces more hearty plants than those that come from clones. Virtually all steps in the production cycle – from vegetative to harvest to composting – are automated for efficiency, cleanliness and reduced human intervention. These innovations minimize crop loss, reduce operating expenses, and enable increased crop yields of consistently high quality, which results in a substantially lower price per gram.

“Canivate’s proprietary facility design, automated growing system, combined with our decreased carbon footprint, is a disruptive innovation in the sector,” said Ingo Mueller, Canivate’s CEO. “Our focus is to deliver world-class facilities built by a world-leading design/engineering firm to some of the best brands in the business – starting in the U.S., then in Canada and, ultimately, globally. Retailers will finally have reliable access to consistently high-quality products that establish a new standard for clean, green and pure products.”

About Canivate

Canivate Growing Systems Ltd. is a Vancouver-based intellectual property/technology company set to disrupt the cannabis and hemp industry. The company’s first facility, targeted for completion by late fall 2020, will be located in Southern California. The plans for the Southern California Campus are for multiple facilities, an R&D building, and a retail dispensary. Additional facilities are being planned for throughout the U.S. and Canada, with a more global strategy to follow.

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For more information, please contact AHA Creative Strategies Inc. at info@ahacreative.com.

Forward Looking Statements

Statements in this news release that are forward-looking statements are subject to various risks and uncertainties concerning the specific factors disclosed here and elsewhere in Canivate’s periodic filings with Canadian securities regulators. When used in this news release, words such as “will, seek, could, plan, estimate, expect, intend, may, potential, believe, should, our vision” and similar expressions, are forward-looking statements. These statements are not guarantees of future performance and involve assumptions and risks and uncertainties that are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed, implied or forecasted in such forward-looking statements.

Forward-looking statements may include, without limitation, statements including statements relating to the information contained in this news release.

Readers should not place undue reliance on forward-looking statements. The forward-looking statements in this news release are made as of the date of this release. Canivate disclaims any intention or obligation to update or revise such information, except as required by applicable law, and Canivate does not assume any liability for disclosure relating to any other company mentioned herein.

This news release does not constitute an offer to sell or a solicitation of an offer to sell any of the securities in the United States. The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the “U.S. Securities Act”) or any state securities laws and may not be offered or sold within the United States or to U.S. Persons unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.

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