Little Green Pharma Ltd. will provide Demecan with three high-THC strains (>22% THC) for distribution in Germany. To maintain strain exclusivity and following a ramp-up period of between 6 and 12 months, Demecan is required to purchase at least 450kgs per annum of each strain. This represents approximately AUD 9 million (6 million) in total revenue per annum for the three strains.

3-year exclusive supply of three high-THC strains to Demecan for distribution in Germany. Demecan has a right of first offer to purchase the agreed strains for exclusive supply in the remainder of the European Union (other than Poland). LGP has a 12-month window to develop the agreed strains within specification, with subsequent supply subject to the normal conditions such as obtaining approvals to supply into Germany and entry into a GMP Quality Agreement.

Demecan has right to inspect first flower development crops and may exclude strains based on saleability criteria, in which case LGP may at its option nominate alternative strains for development and offer the excluded strains to third parties. Demecan must pay 50% of the development costs of each strain successfully developed, subject to caps under the Agreement. Following relevant ramp-up periods, Demecan must purchase at least 38kgs per month to maintain strain exclusivity in Germany, with supply periods of at least 3 years for each product.

Product pricing is tiered based on the sales price achieved with customers and pharmacies, LGP entitled to terminate the Agreement on notice if at any time its cost of production exceeds the product purchase price.