The deal is worth US$376,000 though minimal net proceeds will be retained once a US$276,574 debt is repaid to ANB Bank and historic amounts due to operator True Oil are paid. The company expects final proceeds will be less than US$20,000.
Significantly, with the exit from oil and gas business, the Cannabis and CBD products company will eliminate the group’s most substantial liabilities and operating costs. Zoetic, for example, expects to save around US$1mln per year from the closing of its natural resources office.
"We are pleased to have agreed the sale of our East Denver Assets, which marks the culmination of over a year's effort in transitioning from the company's origins in the US oil and gas business towards our fast developing CBD business,” Trevor Taylor, Zoetic co-chief executive said in a statement.
“Making a strategic exit from the company's legacy operations has refocused our efforts, leaving us with the bandwidth and resources to maximize the potential of our CBD activities."
Zoetic also today told investors that, in its core CBD business, it is in final negotiations for an international distribution contract.
It is expected to be the second contract negotiated for international distribution by the executive team, and, the company highlighted that the continuing demand via quality distributors reinforces the board’s decision to push Chill branded products into the global market.
"We are very pleased with the direction our international go to market plan is headed,” added Antonio Russo, Zoetic's other co-chief executive.
“The strategic partnerships that are coming together give the Company a lot of momentum as the rest of the world starts to use CBD. They will now see what we have witnessed in Colorado for many years," he added.