Thank you, Rob. And thank all of you for joining us today to review Chalice Brands performance for the first quarter of 2021.

Our CEO, Jeff Yapp is expected to join me but he is running into some technical difficulties. So I will keep going and hand it off to him when he does join the line.

I would like to remind everyone that except for historical information, our discussion today will include forward-looking statements that are based on assumptions which are subject to risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements. Management can give no assurance that any forward-looking statements will prove to be correct.

Yes. Can you hear me?

There you go. Okay.

Perfect.

Please just keep going. I'm having problem.

Thanks.

All right.

So John will continue.

We've started off 2021, up with an 18% increase year-over-year compared to the same period in 2022 -- 2020 driven by continued high-growth in Oregon. Please keep in mind this is off of our existing footprint, which I think makes it more impressive at the retail level.

We reported another adjusted EBITDA positive quarter, our second in a row as of in Q1 2021. And we're very, very proud of these results and can't wait to show continued improvement in the balance, continued improvement during the balance of 2021.

Our results reflect the culture of innovation and the collaboration we've fostered with our team. Together we have overcome a myriad of natural and social challenges in 2020 while continuing to execute our plan.

Since Jeff and I took over in 2019, we faced many obstacles, including a state legislative vape ban, the ongoing COVID-19 pandemic, once in a generation wildfire activity in Oregon, widespread social unrest and in early 2021, a once-in-a-decade ice storm which heavily impacted the Portland area. We have executed through all of these challenges and are proud to stand here today to showcase the culmination of our 2020 turnaround and the forward growth expansion and transformation that we have started thus far in 2021.

Jeff loves to say this and I strongly endorsed. During 2020 when others pulled back due to COVID-19, we at Chalice leaned in and committed to serving our customers and our employees.

Our restructuring of wholesale and purchasing has resulted in reliable inventory and demand, allowing our operations and finance teams to plan with more precision and lead time. We have created a culture of resilience, salesmanship and customer service that continues to pay and be refined.

We have strengthened our relationship with our vendors and they have become a critical part of our overall success. Collaboration and co-marketing partnerships were at the heart of 420 this year, as branded content became essential to omni-channel marketing.

We are seeing the convergence of digital and physical retail showing strong engagement in revenue. Chalice is leading the charge in innovation across the cannabis landscape and we are investing in technology and content marketing to accelerate and scale at a rapid pace.

Moving on to today. After turning the corner in 2020, we completed the two raises which set us up for the transformational retail acquisition of Homegrown, which will dramatically increase our leverage and expand on our core competencies in retail management, culture, marketing and digital promotion and innovation.

Jeff, what can shareholders expect as a result of the name change? Are you there?

I think so. From our perspective, it's actually a better alignment to the retail brand and what we have really worked very hard to build under the Chalice Farms brand.

So we think this better aligns it. It also reflects where we're going in our focus on building brands underneath our portfolio.

So a very clearly defined brand architecture. And I think the name change from Golden to Chalice Brands Ltd.

really helps support where we're planning to take the business.

One of the other ones we've gotten, which I'll take Jeff is what was the rationale for the 23:1 share consolidation? There were multiple reasons.

By the time we've closed Homegrown, we were going to be close to 1.5 billion shares outstanding. One of the downsides of that to us is that very small volumes could significantly in a percentage-wise affect the value of the shares.

We also look forward to Federal G regulation and banking. And then from there which we think will be the institutional investors will become more interested in stories like GLH all of those have market cap and share price restrictions which a penny stock which would not make us eligible.

So we think -- and realistically from this point on, now that we've hit the point of being EBITDA positive, we will continue to be cash flow positive and grow future transactions if we are in the acquisition phase of things will require us to go raise capital. And so we expect when further accretive transactions come along, we may have to issue more shares and this will again allows us to have a quarterly capital structure.

Jeff, what does Homegrown and Fifth & Root do for Chalice?

We're really excited by what these two acquisitions represent overall. Obviously, Homegrown almost doubles the size of our store footprint and our revenue which gives us -- and it puts us in a really good place overall in the marketplace.

We clearly think from a just a pure market leverage perspective, it's terrific. It also gives us an opportunity to continue to leverage the growth that we have of Bald Peak by having these additional store footprint.

So most of our flower goes directly in our own stores, which will really have a significant impact on our margins. Fifth & Root, we're excited because I think it really starts to put us in a place to think about future legalization for cannabis and allows us to build a nationwide commerce platform.

It's also a product that while close to cannabis and CBD, it clearly puts us in place to begin to develop a dialogue which is a very important segment female head of the house that we think will be critical to new user growth in the future for cannabis. So it kind of does a couple of things.

It gets us into a market that we think we should be in with a target that really matters but more importantly provides a great foundation from which to build a commerce and a transactional relationship with a very important segment when legalization does add. So John...

A couple of things. I think one, we clearly understand where the market is and we wanted to be able to price at a discount.

But the other piece was, the leadership of Homegrown really believed in our company and the first price was a combination of cash and our stock, which I think helped them. And I think felt very confident in what we could do with it.

So I think that allow us to buy at an overall price that was very favorable. John?

Another question that we've got -- yes, go ahead.

No. I was going to ask you a question but go ahead.

Yes. No, go ahead.

Ask me.

Do you intend to continue acquisitions?

Yes. I think.

So, we've clearly stated our goals of what we think we're capable of becoming, and how we're going to accomplish that as a combination of the organic growth that now 12 stores plus our growth plus our production capability and our wholesale will provide us. And then, we will do like we did with Homegrown.

We will look for the right cultural and operational fits in -- Oregon is now our run state. So we think it makes a lot of sense to look for three to five store acquisition opportunities initially.

And then as our size and scale improve, we will look for larger opportunities. We are going to be disciplined and we're going to keep it in the metrics of 0.75 to 1.25 maximum, depending on the scale of the business.

So, we think if we can buy accretively like that, like Homegrown has shown, it will be -- whether it reflects in the share price today or not we believe that it will be accretive to shareholder value in the long run. Jeff, I now suggest we go into the presentation.

Let me know if you can see it?

I've got the presentation, and we're going to stay on this channel.

Yes. We're going to stay on the channel.

It's up on people screens. So, we've got the slide with the disclaimers.

Slide 3, Jeff you can pick up from there. Just -- well, this is just -- this is a boilerplate statement.

Yes, go ahead.

Yes. I would say self-explanatory.

We're a vertically integrated, now cash flow positive and EBITDA positive operator focused in Oregon, but clearly looking to grow west of the Mississippi. We've also added California into our portfolio also.

So…

So we've talked about our experience that I won't get into that. But when we started last -- after the AGM, Jeff would like to highlight a couple of our management team members each of these meetings.

So, Jeff, like whoever you want to talk about this time and tell us a little bit about them.

Sure. Yes.

I'm going to highlight Meghan Miller. Meghan is our Chief Cultivation Officer -- Chief Cultivation Community Officer.

Meghan comes with a very strong background in cannabis. She has worked in the genetics side of the business division with a company called Phylos, which worked on developing -- working with growers on their genetics and really starting to capture those genetics.

But more importantly she worked really broadly. As a result of that we’ll developed very deep relationships with some of the best growers in Oregon, Washington, in fact really around the world.

And she joined us about 1.5 years ago and first responsibility was to get a Bald Peak to realize the potential. She's done an incredible job built an amazing team with culture up there and the results are really starting to show now, which has been perfect.

The other thing Meghan did was bringing a great deal of credibility in the community having been there and earned the trust of the community. So, we've got probably the best partnerships we've ever had in terms of supporting our business, allowing us to have access to some of the best products, best growers in the state.

And importantly some really deep partnerships that support both our marketing programs, as well as our overall business. And we've been really, really helpful.

But she's had quite an impact on our business. And this is what is a good example of balancing the art and science of cannabis.

So it's the science of running a disciplined profitability business and the art that cannabis and agriculture represents. And balancing those two, I think is critical to our long-term success.

Great. You had a surprise for us to tell.

Talk about it Jeff.

I do. I do.

I do. It's -- I'm really excited that started yesterday is a new addition to our C-suite officers Ginger Mollo.

Ginger joins us from a long career in retail. She spent 17 years at Apple on a global basis, started originally with the group and obviously spent 17 years to build that chain.

Really fundamentally, she played a critical role in the definition of the culture that Apple has come renowned for retail. Importantly she worked with John Ford, who is our Chief Revenue Officer.

They worked together for many years while at Apple. And in fact Jane, John and now Ginger have all come out of the Apple group.

Obviously, John and Jane went on to work from Microsoft and now with us. Ginger went on and was Head of Operations for Neiman Marcus and most recently made the decision to join us.

She will come on as our General Manager of Fifth & Root, really starting to set the vision for what we think that business could be, but also as our Chief Integration Officer, as we continue to think and identify companies how we work to make those acquisitions profitable and successful. But more importantly, we merge the culture into what we believe pervades since we...

Jeff, we can't afford her. How do we get her?

She like everyone else on the team, made a decision to join the team not on what the short-term income was going to be, but she has taken an equity position like all of us have in for the long haul. So, she has come at a rate that's much lower than any market would be and really is reflective and consistent with the rest of our team.

So, she recognized what we'd all committed to and she came on board the same way.

And one of the things you will hear us continue to talk about is the importance of brand retail excellence and we believe a lot of companies say it. If you look at the firepower that Jeff has assembled on this team, it really reflects the opportunity to get there.

And I think that's the path that we've set forward for the company. Quickly, Q 2021 highlights as I covered off in the previous segment.

The key focus is keeping adjusted EBITDA positive and growing that. We did that by containing operating costs, which included share-based compensation and contribution from biological assets.

In doing so, we hit the record first quarter revenues of $5.5 million, which represented 18%, increase from 2020, while decreasing the operating cost 21%. Gross profit margin was 45% compared to 37%.

And 6.5% of our retail sales we're really proud of this 12% of the category were internally cultivated flower compared to zero in Q1 2020 and we see this number growing. And that frankly gives us one of the synergy opportunities in the Homegrown acquisition and future acquisitions as we will be able to bring our own into our own stores.

And then honestly -- go ahead Jeff.

You can really -- you can start to see the impact of our own flower in our margin improvement. So when we go from 37 to 45 that was directly impacted by the percentage of our business now reflected in our own product in our own flower.

Right. And once again the adjusted EBITDA of $370,000 represents 7% and we like the trend that this is on.

We won't really go into this. We covered it off before.

But again the highlights are we cleaned up the balance sheet. We've got the debt now really manageable.

So there should be no pressure on the balance sheet. Especially, if the share price keeps going up we would expect people would convert into equity and capitalize on the gain instead of a debt return.

The balance sheet strengthening gave us the credibility to go raise the capital which was needed to go on the acquisition of Homegrown. So all these things is a combination of all the work that Jeff and the team have done and it allowed us -- they go hand-in-hand and sets the stage to go into growth mode.

As Jeff talked about Bald Peak we have continued optimization of it. Now we're up to ongoing output of 250 pounds per month beginning in Q2.

We think our Homegrown -- sorry Bald Peak on its own can support 18 to 20 stores. So we're at 12.

We have capacity. And as we need to change -- as we need to add to that as our footprint improves increases we will do so.

Jeff, do you want to talk a little bit about Homegrown? And what that means to us?

Yes. Sure.

Yes. For us it was really exciting.

We had an opportunity that we've known. Jill and Alicia founded and started Homegrown.

We watched their business. But what we found was a tremendous fit in terms of their culture, their -- the way they edge -- trained the commitment made to their employees.

And what I really loved about the chain it was a perfect fit that complemented our retail footprint in so many ways. So for us it really felt like culturally a really strong fit, really strong performers.

They were well run profitable. And right out of the box would have been accretive.

For us we're really focused on one-on-one becoming three. We're obviously going to learn what they do really well.

They'll learn what we do really well. And I think as a result the combined forces will be even stronger.

It clearly gives Meghan and her team a much better position in the market in terms of what we acquired. We just significantly improved our overall leverage in the marketplace.

But I'd say in total this couldn't have been -- having done many acquisitions in the past this has been an amazing treat. We had the entire management team up yesterday and their store managers and I think everyone is really excited on both sides what this represents for both companies.

Well, one of the things I'd like to highlight Jeff is that when you look at the press release we put out in February about the transaction they actually exceeded their performance run rate before we closed on the deal right which is really -- when you think of what we hope to do with it, it really I believe set us up on the right foot on all fronts. Not all acquisitions will work like this but it's still a -- I think we're really happy about it.

Yes. This is one that had great momentum coming in.

So there's other transactions you'll see where you're buying something to fix it. These guys have really done a nice job and we hope to just accelerate what they've already been doing.

So it's a really good fit for us.

Yes. And I think the other thing to highlight is the sale happened for the lifestyle reasons not for any other.

And we're lucky that they're going to continue on as shareholders and good partners for you to draw up one. Jeff quickly just with the quarterly revenues?

Sure. Yeah.

Retail continues to be strong, 20% year-over-year, wholesale, 26% year-over-year. The growth is both traffic and average ticket.

So it's really strong growth. So we're pleased overall.

Great. Yeah.

So you just touched on the ticket sales. Again, we really want to talk about this.

The -- if you look at, Q4 2020 -- sorry 2019, where we were on an adjusted EBITDA loss perspective, to the -- while it may have started slowly and is still going up slowly, it has been a byproduct of cost reductions, operational efficiency, increase in sales. And really attest to Jeff's and the team's crawl-walk-run, commitment.

And by doing so, I think, we are building Chalice to have a sustainable and growing business. Then, we -- the capital structure with -- this is updated to as of May 24.

Post-consolidation we will have just under, 63 million shares outstanding. There's, a 5.3 million of options.

Our total debt outstanding is $11.1 million of which, half this -- half of that is -- more than half of that is in shares, and just the adjusted EBITDA reconciliation.

So with that, we'd like to thank you for your support. And for any of you, who saw the wild ride today hang in there.

There maybe more of this until situation is under hand. But our supporters of help and we encourage not to sell, if you believe.

Thank you. On behalf of Jeff and the team, we thank you.

Thank you very much.

Operator?

Thank you.