TROY, Mich. - Agrify Corporation (NASDAQ:AGFY), a provider of advanced cultivation and extraction solutions for the cannabis industry, has announced a significant multi-year deal with HarvestWorks Farm, a New Jersey-based licensed cannabis operator. The agreement, valued at $3.4 million, includes the purchase of 156 Vertical Farming Units (VFUs) and a complete Turnkey Pure Pressure Solventless extraction Lab Package.
The partnership further entails a 2-year Service Support Agreement with Production Success Fees (PSF) set at $350 per pound, and a 5-year SaaS Fee Agreement approximated at $1 million. HarvestWorks Farm, under the leadership of CEO Rita Ruggieri, is one of the first licensed operators for cannabis cultivation and manufacturing in New Jersey and focuses on producing high-quality cannabis products for wholesale distribution.
Raymond Chang, Chairman and CEO of Agrify, expressed enthusiasm about the collaboration, highlighting Ruggieri's entrepreneurial success and expertise in the cannabis sector. The deal is poised to introduce a range of innovative cannabis products to the New Jersey market by early summer 2024.
HarvestWorks Farm has already initiated the deployment of 70 double stacked VFUs in their 20,000 square foot facility and plans to incorporate an additional 80+ VFUs in a subsequent phase. As part of the service agreement, Agrify will provide on-site operational support to ensure optimal production quality and efficiency. Agrify estimates that each VFU can produce an average of 40 pounds of premium flowers annually.
Rita Ruggieri praised Agrify's team for their assistance in equipment installation and for the advanced solventless training program, which has equipped the HarvestWorks staff with the skills to produce a variety of high-quality concentrates. The company is looking forward to leveraging Agrify's technology and data to deliver consistent, high-quality cannabis products to the burgeoning adult-use market in New Jersey.
This announcement is based on a press release statement from Agrify Corporation.
InvestingPro Insights
As Agrify Corporation (NASDAQ:AGFY) secures a promising deal with HarvestWorks Farm, it's crucial for investors to consider the company's financial health and market performance. According to InvestingPro data, Agrify's market capitalization stands at a modest $3.42 million. This figure, while giving a sense of the company's size, also reflects the challenges faced in a competitive industry.
InvestingPro Tips highlight that Agrify operates with a significant debt burden and may have trouble making interest payments, which could raise concerns about the company's financial sustainability. With analysts not anticipating the company to be profitable this year and a stock price that has fallen significantly over various timeframes, including a 93.8% drop over the last year, the financial outlook appears to be under pressure. These factors, coupled with the stock's high price volatility, underscore the importance of due diligence for potential investors.
Despite these challenges, analysts anticipate sales growth in the current year, which could be a silver lining for Agrify as it expands its operations with new deals like the one with HarvestWorks Farm. Interested investors may find additional InvestingPro Tips and data that could help navigate these complex dynamics. There are 20 more tips available for Agrify on InvestingPro, offering deeper insights into the company's prospects. To access these insights and enhance your investment strategy, use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription.
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