Sunniva Inc. signed an agreement to acquire the Oakland Vision Project, which operates a licensed cannabis cultivation facility in Irvine, California.

Under the agreement, the Canadian cannabis company will issue common shares worth US$1 million on closing the deal and an additional US$2 million worth of shares once certain operational milestones have been achieved by the end of 2019. The shares will be priced at US$5.24 each. Sunniva will not assume Vision's long-term debts.

"This acquisition will deliver full vertical integration in California that strategically enhances the value of the Sunniva brand," President Leith Pedersen said in a news release.

"Production from this facility will allow Sunniva to launch its first premium-quality craft flower brand with the assurance of large-scale production," he added.

The transaction remains subject to conditions such as the negotiation and execution of a definitive agreement, due diligence and regulatory approvals.