Agrify’s Enters Into First Hydrocarbon Extraction Lab & Vertical Farming Unit Facility in California
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The announced sales agreement between Agrify Corporation and Ocean Deep/Golden Lake Business Park represents a strategic move in the cannabis industry, particularly within the California market. This partnership is indicative of the growing trend for vertical integration in the sector, which allows companies to control the entire process from cultivation to extraction and sale, potentially leading to increased margins and market share.
From a market perspective, the adoption of Agrify's PX30 Hydrocarbon Extraction Lab Package and VFUs could enhance Ocean Deep's competitive edge by increasing their production efficiency and product quality. The PX30's capability to process large batch cycles rapidly is a significant technological advancement, likely to cater to the increasing consumer demand for cannabis products. The high throughput of up to 240+ lbs. per 8-hour shift is notable, as it suggests a substantial increase in potential revenue and market supply.
Furthermore, the emphasis on safety with UL-compliant EXP Rooms aligns with the heightened regulatory scrutiny within the industry, potentially reducing operational risks and assuring compliance. This aspect may also appeal to investors who are increasingly considering ESG (Environmental, Social and Governance) factors when evaluating companies.
The financial implications of this multi-million dollar sales agreement for Agrify are significant. The upfront revenue from the sale of the VFUs and the PX30 system will bolster Agrify's financial position in the short term. However, the long-term impact on the company's revenue stream will depend on the successful implementation and operation of these units by Ocean Deep.
Investors should note that the scalability of Agrify's technology could lead to recurring revenue through future sales and service agreements. The deal could also serve as a reference case for Agrify, potentially attracting more clients in the burgeoning cannabis market. The company's stock market performance may reflect the market's perception of this deal's potential to increase Agrify's market penetration and future growth prospects.
It is important to monitor the execution of this agreement closely, as delays or technical challenges could impact expected financial outcomes. Moreover, investors should consider the competitive landscape in California, which could influence Ocean Deep's market success and, by extension, the realized benefits for Agrify.
The legal landscape of the cannabis industry is complex and varies by state. The mention of UL-compliant Explosion Proof (EXP) Rooms in the context of C1D1 and C1D2 extraction labs is critical, as it reflects adherence to stringent safety standards for handling volatile substances. Compliance with these standards is essential for operating within legal frameworks and avoiding potential legal liabilities resulting from safety violations.
The partnership's focus on safety and regulatory compliance is a strategic move for both Agrify and Ocean Deep, as it may streamline the approval process for operation and reduce the risk of costly legal challenges. This commitment to safety and compliance is likely to be well-received by stakeholders, including regulators and insurers and could set a precedent in the industry for best practices in cannabis extraction operations.
TROY, Mich., Jan. 18, 2024 (GLOBE NEWSWIRE) -- Agrify Corporation (Nasdaq: AGFY) (“Agrify” or the “Company”), a leading provider of innovative cultivation and extraction solutions for the cannabis industry, today announced it has entered into a multi-million dollar sales agreement (“the Agreement”) with Ocean Deep/Golden Lake Business Park, a California-based vertically integrated cannabis operator. Ocean Deep will be extracting products with Agrify’s turnkey PX30 Hydrocarbon Extraction Lab Package to bolster its product offerings. Ocean Deep is also expected to begin operation with an estimated 120 Vertical Farming Units (“VFUs”) sold by the Company to produce high-quality cannabis flower in 2024.
The PX30 Hydrocarbon Extraction System is the largest system of Agrify’s PX-series. The PX30’s four 7.5 lbs. material columns can be run in parallel, allowing a complete 30-pound batch cycle in under 60 minutes, and making it one of the largest and fastest extractors on the market with up to 240+ lbs. per 8-hour shift. This robust system is poised to offer enhanced capabilities for hydrocarbon extraction, catering to the demands of commercial operators focusing on large-scale batch processing and extracting for the creation of direct-to-consumer products.
Raymond Chang, Chairman and CEO of Agrify, shared that “We are very excited to announce this agreement for the sale of our first combined VFU and PX30 Hydrocarbon Extraction Lab facility in the state of California. We applaud our partner Ocean Deep/Golden Lake Business Park’s foresight for selecting Agrify’s technologies in the fiercely competitive California market. We believe our superior cultivation and extraction technologies will allow Ocean Deep to offer the highest quality and most consistent products to its customers.”
The addition of Agrify’s UL-compliant Explosion Proof (EXP) Rooms was, the Company believes, an ideal choice for Ocean Deep’s C1D1 extraction lab. Agrify’s safe and easy to install C1D1/C1D2 extraction rooms are designed to be easily set up in less than one day and are equipped with a PSI technical report certification for professional engineers to field verify in all 50 states.
“As CEO of Ocean Deep/Golden Lake Business Park, it is with great enthusiasm that I disclose our new alliance with Agrify, renowned for their trailblazing cannabis cultivation and extraction innovations. Our southern California operations will proudly serve as a showcase for their end-to-end cannabis solutions,” said Mr. Sun, CEO of Ocean Deep/Golden Lake Business Park. “We chose Agrify because their approach to the industry is grounded in science and focuses on efficiency which resonate with our mission to redefine industry benchmarks through the adoption of forefront technologies that amplify our production capabilities and assure superior product quality. We look forward to the advancements and triumphs that our combined efforts will yield.”
These industry developments illustrate the continuous innovation and commitment to safety within the cannabis sector as Agrify adapts to expanding market demands.
About Agrify
Agrify is a leading provider of innovative cultivation and extraction solutions for the cannabis industry, bringing data, science, and technology to the forefront of the market. Our proprietary micro-environment-controlled Vertical Farming Units (VFUs), enable cultivators to produce the highest quality products with unmatched consistency, yield, and ROI (return on investment) at scale. Our comprehensive extraction product line, which includes hydrocarbon, ethanol, solventless extraction, post-processing, and lab equipment, empowers producers to maximize the quantity and quality of extract required for premium concentrates. For more information, please visit our website at http://www.agrify.com.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 concerning Agrify and other matters. All statements contained in this press release that do not relate to matters of historical fact should be considered forward-looking statements including, without limitation, statements regarding the number and type of products to be sold to Ocean Deep/Golden Lake Business Park, the ability of those products to offer enhanced capabilities for extraction, and the ability of Agrify’s technologies to offer improved consistency and quality. In some cases, you can identify forward-looking statements by terms such as “may,” “will,” “should,” “expects,” “plans,” “anticipates,” “could,” “intends,” “targets,” “projects,” “contemplates,” “believes,” “estimates,” “predicts,” “potential,” or “continue” or the negative of these terms or other similar expressions. The forward-looking statements in this press release are only predictions. We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our business, financial condition, and results of operations. Forward-looking statements involve known and unknown risks, uncertainties and other important factors that may cause our actual results, performance, or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. You should carefully consider the risks and uncertainties that affect our business, including those described in our filings with the Securities and Exchange Commission (“SEC”), including under the caption “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2022 that was filed with the SEC on November 28, 2023, which can be obtained on the SEC website at www.sec.gov. These forward-looking statements speak only as of the date of this communication. Except as required by applicable law, we do not plan to publicly update or revise any forward-looking statements, whether as a result of any new information, future events, or otherwise. You are advised, however, to consult any further disclosures we make on related subjects in our public announcements and filings with the SEC.
Agrify Investor Relations
IR@agrify.com
(857) 256-8110
FAQ
What is the sales agreement announced by Agrify Corporation?
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