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CLS Holdings USA, Inc. (CLSH) (CLSH)

CLS Holdings USA, Inc. is a development stage diversified cannabis company. CLS stands for "Cannabis Life Sciences," in recognition of its patent pending proprietary method of extracting various cannabinoids from the marijuana plant and converting them into a higher quality and quantity of products. CLS Holdings USA specializes in the extraction and conversion of cannabinoids. The company is based in Boulder, Colorado.

CLS Holdings USA's mission is to be the industry leader in the extraction, conversion and marketing of cannabinoid oils, wax, edibles, and shatter through taking advantage of its proprietary extraction methods and conversion processes. The company's business model includes licensing operations, processing revenue, processing facilities, sale of products, brand creation, and consulting services.

One of the founders of CLS Labs has been developing a proprietary method of extracting cannabinoids from cannabis plants and converting the resulting cannabinoid extracts into concentrates (oils, waxes, edibles and shatter). The company's plan is to monetize the extraction method and generate revenues via the licensing of its proprietary methods and processes to others, as in the Colorado Arrangement, the processing of cannabis for others, and the purchase of cannabis and the processing and sale of cannabis-related products.

CLS Holdings USA's intention is to lease buildings at which to construct processing facilities. It estimates the cost to develop each facility (including equipping the facility with appropriate equipment) to be between $1,000,000 and $3,000,000. CLS anticipates that it can complete each build out in about four to six months after any applicable licensing and permitting requirements have been met.

Concerning Processing Revenue, the company's intention is to enter into arrangements with cannabis growers - CLS will process their cannabis for a fee. Under such arrangements, growers will deliver cannabis plants to one of CLS's facilities for processing. CLS Holdings will then apply its proprietary extraction and conversion technology to produce cannabinoid concentrates, which may be delivered to the grower in bulk form or, for an additional fee, in individually-labeled retail-ready packages of oils, edibles, wax or shatter.

Further to Licensing Operations, in states such as Colorado, where CLS Holdings USA is unable to obtain a license to operate a cannabis processing facility because of residency or other requirements that it cannot meet, the company will continue to enter into arrangements alike to the Colorado Arrangement.

On April 17, 2015, CLS Labs took its initial step toward commercializing its proprietary methods and processes through entering into an arrangement in Colorado. It entered into an arrangement via CLS Labs Colorado to, among other things, license its proprietary technology, methods and processes to PRH in exchange for a fee; and construct a processing facility and lease such facility, including equipment, to PRH.

Essentially, CLS will agree to build out a processing facility and subsequently lease the facility and equipment to the client for what will usually be a 10-year term. The client will be required to enter into an agreement of equal length to license the company's proprietary technology, methods, as well as processes exclusively for use in the processing facility.




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