ITG CTD #1 - Tennessee

Min. Invest
$10,000
Target Hold
24 mo
Annualized Returns
11.70%
Progress - 0% Pledged
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Who we are and What we do

Innovative Technologies Group Inc. ("ITG" or "the Company") is a growth-oriented, technology company that believes by bringing new technologies and innovations to commercialization, we will provide the marketplace with enhanced and lower-cost solutions to meet the needs of individuals and companies.  ITG's strategy is to develop, scale and generate revenue from our proprietary technologies. Our initial focus has been to create nature-based solutions to replace chemical and fossil fuel-based processes and end products.

The Company was founded in 2019, is headquartered in Jacksonville, FL., and is led by a seasoned team of business and engineering professionals and shareholder-value focused Executive Management Team and Board of Directors.

As a keystone of our mission, ITG has acquired a license to a proprietary processing technology that gives the Company a unique, one-of-a kind competitive advantage over other processors and which the Company believes will be a major disruptive force in the CBD and other cannabinoid processing industry. Initially we will utilize our proprietary crude to THC-free distillate (CTD) technology and modular biomass processing unit (MBPU) technology to develop solvent free, efficiently produced clean, high-value cannabinoid and carbon-based products. The carbon biochar which is an additional output created by the MBPU will be further processed into activated carbon and in the future, graphene-based products. Graphene is a rare earth material which because of its chemical makeup is used to a small scale in electronics and component manufacturing. It has unlimited bandwidth and has 100 times the tensile strength of steel at a fraction of the weight.  It is only beginning to be used industrially because it has not been able to be produced in large scale for commercial or industrial purposes.  Our plan is to create much larger quantities at substantially lower cost than is presently available.  If we are able to accomplish this, we can be a disruptor in numerous industries. There are a number of federal, state, and local sustainability grants and programs available which we are pursuing. Our intent is for the facility to be located within a qualified opportunity zone which creates special funding opportunities through tax incentive investments funds. The graphene development process is in progress.

As soon as our hemp processing development is completed, the Company also has plans to responsibly process wood biomass and other materials and manufacture all natural, plant-based products such as bio plastics and biofuels. This will be discussed in greater detail later in this overview.

Additionally, in an effort to utilize the product from our hemp biomass processing units and our desire to commercialize new technologies, we are in negotiations to acquire the rights to a developmental stage nutraceutical line of consumer products which has unique rehydrating capabilities and just as importantly, whose sales can be successfully expanded both online and through traditional distribution channels. We are also entertaining the possibility of acquiring a company which is already in this business space and augmenting their sales with a line extension of our products.  We believe, this type of business expansion financing would be readily available. We are also in negotiations involving a licensing or joint venture agreement for a revolutionary particle reduction and moisture removal system, which will be employed across many industries. Additional funding would be required for these efforts.

Our initial project will encompass the creation of a CTD processing facility in Tennessee which should be operational in the fourth quarter of 2020. It will generate revenue from a tolling/service contract for products produced by the initial CTD unit which is in final development and on track to be online next month. Our contract provides healthy gross and operating margin profiles. The contract revenue will produce a steady stream of revenue which will require no cost for the raw material. The only cost will be the operational expenses of the facility. There will be an agreed-upon price to process the oil on a per liter basis. That amount will be paid to us when the client receives the processed THC­ free distillate. There will be no sales effort required on our part. The agreement will be a straight servicing fee contract.

Once we have the tolling revenue stream established, we will look to augment this revenue stream with a concerted sales effort. At that time, we plan to purchase our own crude, process the crude, and then market and generate revenue from sales of the crude. We have developed excellent opportunities in this area which we will pursue with a second processing unit which should be online in the first quarter of 2021 and a third unit which should come online by the end of 2021. The cost of the second and third machines has been included in our initial round of capital funding. At this point, without any other funding, ITG should be profitable and will be able to service the investor debt as outlined in the term sheet regarding investment in our first private placement offering.

With proposed subsequent rounds of financing we plan to continue our hemp and wood biomass processing effort utilizing the MPBU units. This process is a patent pending, university created catalytic pyrolysis method. We have acquired rights through a license to commercialize this technology. This effort will include the establishment of an additional processing facility in Tennessee which will encompass our wood biomass processing units. We will create contracts with local farmers in Tennessee and surrounding areas who will provide us with the hemp for our hemp processing facility. We will also create or house within the same structure (150,000 sq ft), our wood biomass facility. Our wood biomass will be provided by contracts from area wood mills. Our plan is to create a 1000 ton per day processing facility which will produce biofuel and bioplastics. We will provide a smaller pilot plant initially to establish profitability parameters before creating the 1,000-ton facility.

Also, as part of our long-term plan funded by subsequent rounds, we will launch a proposed hemp fiber division which will create hemp derived construction materials and high-value hemp derived consumer related products. We have started initial joint venture negotiations with a company which has extensive experience and developmental capabilities in this area.

In addition to these efforts, we are in negotiations with the manufacturer of a proprietary technology for use in drying crops far more effectively and with greater cost savings than processes now available. This technology can also be used in other industries and as an effective and cost -saving method for the conversion of all forms of liquid and solid waste. This market is extremely large both domestically and internationally and the use of this technology will be a disrupter in this area. This technology can also be used in mining to substantially reduce the cost of ore separation without environmentally dangerous chemical(cyanide) processes. Additional rounds of funding will be necessary to complete the purchase of these units once they are manufactured which we believe will be completed within 18 months.

It is important to point out that although most of our future development initiatives are dependent upon subsequent rounds of financing, we expect to achieve profitability with this initial round of financing.

Currently, the biomass processing division is focused on the following activities:

  • Finalizing and completing production for the first processing plant in Tennessee.
  • Announcing and completing an initial private placement offering of up to $1,100,000 Unsecured Convertible Promissory Notes.
  • Completing financial and engineering models of the Company's processing plant in Tennessee and future processing plants.
  • Finalize agreements for joint ventures.
  • Evaluating potential new processing projects, joint venture opportunities and potential acquisition opportunities.
  • Ongoing development of innovative patent designs to develop lower-cost processing systems and applications.
  • Adding qualified members to the Company's Board of Directors and Board of advisors.

Our statement on environmental, social and governance (ESG) standards.

ITG is a sustainable-based company and that is a core value of our corporate culture. Our founding in 2019 began with identifying manufacturing and processing technologies that are environmentally friendly. The Company's processing technologies are revolutionary, utilizing zero fossil fuels during the process.

Beyond the balance sheet, we have steadily built human capital. We recognize our staff members as our most valuable assets. Our board and management are committed to building and maintaining trust while fostering innovation, and we expect our employees, suppliers, and advisors to support our corporate values.

We continue our commitment to environmental responsibility by continually examining our activities and priorities to determine what actions we can and should take to preserve the local environment and foster lower carbon emissions and initiate other environmental safeguards, while enabling our facilities to be fully productive. In order to serve these priorities, we have innovative proprietary technologies in the green energy and nutrition areas.

We are committed to socially responsible employment practices and to be a supportive corporate citizen of the communities where we operate. Our practices include nurturing an environment of inclusiveness, empowering women, and minorities, and consistently operating ethically on a daily basis. We believe strong corporate governance is the foundation to delivering on our commitments to our shareholders.

Finally, we plan to publish and publicly announce a complete Corporate Sustainability Report on an annual basis.

"ESG corporate practices represent a cornerstone of our business. Our sustainable practices help us deliver reliable and affordable green products and solutions to our customers, as well as strong, consistent value for our shareholders."

Robert Bryant | Chief Executive Officer

Investment Type Convertible Note
Term 24 Months
Raise Amount $1,100,000

Investment Highlights

Offering Highlights:

  • 506(c) Private Placement Offering of up to $1,100,000 of unsecured convertible notes at $2.19 per share.*
  • The Company is offering Convertible Notes that bear simple interest at the rate of 11.67% per annum on the outstanding principal balance with a two-year maturity date.  (Based on current LIBOR plus increased percentage for risk factors)

Why Invest?

Why Invest in ITG:

  • We are  in the final stage of production and on track to recognize revenue by the end of the third quarter of 2020.
  • We expect to achieve profitability with this initial round of financing. 
  • The Company will initially generate revenue from tolling contracts (tolling/service contracts are where we receive a servicing fee and will not be required to purchase or sell products).
  • Debt service coverage ratio at conversion end (December 2022):  5.62. 
  • Revenue is planned to be derived from operations within a Qualified Opportunity Zone.

(CTD) Crude to THC Free Distillate

 

  • Proprietary, solvent-free processing of Hemp Crude to CBD Distillate.
  • Our initial project is the creation of a state-of-the-art CTD processing facility in Tennessee which should be operational by the end of the third quarter of 2020 and which will process hemp oil crude into THC-free distillate. 
  • To maximize cash flow, we are proceeding with toll manufacturing on a fixed revenue per liter structure.
  • This method requires no selling expense or raw material expenditures.
  • Once we have this revenue stream established, we will augment this revenue stream with direct sales and JV opportunities.  

(MPBU) Modular Biomass Processing Unit

  • The MPBU processing unit is unique in its capability of  processing Hemp Biomass direct to THC-free CBD Distillate, wood biomass to biofuels and bioplastics, along with carbon-based products, utilizing a proprietary solvent-free and CO2-free processing technology.
  • ITG plans to continue our hemp and wood biomass processing effort utilizing the MPBU units. This process is a patent pending, university-created catalytic pyrolysis method. We have acquired rights through a license to commercialize this technology. This effort will be included in the processing facility in Tennessee which will incorporate our hemp and wood biomass processing units.
  • The process utilizing the MBPU (modular processing biomass unit)  also creates a carbon stream which will be further processed into activated carbon and graphene-based products.(development process for graphene-based products is in progress)

ITG Product Development

  • ITG utilizes "State of the Art" proprietary equipment that uses no solvents or CO2 to either extract our in-house Raw Hemp or to convert Hemp Crude to Distillate.
  • We do not process any products with Greenhouse gases. All materials are packaged in our FDA, Food Grade Processing Facility.
  • The Company acquired rights through a license to commercialize a patent pending, catalytical reaction process created by a recognized University.
  • The Company plans to establish a graphene development program. Graphene is a highly sought-after rare-earth material which because of its characteristics is used in a variety of electronics and component manufacturing. 
  • ITG has entered into discussions with  Companies that have developed multiple groundbreaking technologies.

Product Pipeline

  • Nutraceutical products
  • Husbandry enhancement supplements
  • High-Value Hemp/Fiber products
  • Activated carbon-based products
  • Bio-plastic products
  • Bio-fuel products
  • Graphene-based products

Qualified Opportunity Zone Potential

 

  • Our intention is to locate our CTD and MPBU projects in a qualified opportunity zone1 where we are planning to establish an economic development center. 
  • Qualified Opportunity Zones (QOZ) were created by the 2017 Tax Cuts and Jobs Act. These zones are designed to spur economic development and job creation in distressed communities throughout the country and U.S. possessions by providing tax benefits to investors who invest eligible capital into these communities. 
  • Taxpayers may defer tax on eligible capital gains by making an appropriate investment in a Qualified Opportunity Fund and meeting other requirements. 

Financial Projections

  2020 2021 2022
Revenue  
  Sales *(1,2,3) $  $7,843,750 $10,500,000
  Cost of Goods Sold Raw Oil $  $2,550,000 $3,600,000
  Labor $27,733  $83,198

 $83,198 

  Utilities  $20,000  $60,000  $60,000
  Maintenance  $20,000  $60,000  $60,000
  Rent  $41,667  $125,000  $125,000
  Total COGS  $159,399  $3,338,198 $3,928,198
  Gross Profit  ($159,399) $4,505,552

$6,571,802

 Operational Expenses        
   Indirect Labor  $154,000  $372,000  $372,000
   SG&A  $324,913 $1,095,927

 $1,583,524 

   Ops Expense  $478,913  $1,467,927  $1,955,524
 Net Income    $(638,312)  $3,037,624  $4,616,278
  EBITDA  $(585,060)  $3,124,628  $4,669,530

 

 

Market Summary

TBD

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Investor Tutorial

CERTAIN INFORMATION REGARDING THIS OFFERING

THESE UNITS ARE BEING OFFERED WITHOUT REGISTRATION UNDER ANY FEDERAL OR STATE SECURITIES LAWS, BUT ARE BEING OFFERED UNDER AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND UNDER COMPARABLE EXEMPTIONS UNDER VARIOUS STATE SECURITIES LAWS. HOWEVER, THE SECURITIES AND EXCHANGE COMMISSION (“COMMISSION”) HAS NOT DETERMINED THAT THESE UNITS ARE EXEMPT FROM REGISTRATION. THESE UNITS HAVE NOT BEEN REVIEWED, APPROVED OR DISAPPROVED BY THE COMMISSION OR ANY STATE SECURITIES COMMISSION, NOR HAS THE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY, ADEQUACY, COMPLETENESS OR MERITS OF THIS MEMORANDUM, AND ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. THIS MEMORANDUM DOES NOT CONSTITUTE AN OFFER TO SELL TO, OR A SOLICITATION OF AN OFFER TO BUY FROM, NOR SHALL ANY OF THE UNITS BE OFFERED OR SOLD TO, ANY PERSON IN ANY JURISDICTION IN WHICH SUCH AN OFFER, SOLICITATION, PURCHASE, OR SALE IS UNLAWFUL OR UNAUTHORIZED UNDER THE SECURITIES LAWS OF SUCH JURISDICTION.

THE STATEMENTS MADE HEREIN ARE MADE AS OF THE DATE ON THE COVER OF THIS OFFERING MEMORANDUM. THIS OFFERING MEMORANDUM CONSTITUTES AN INVITATION TO THE PROSPECTIVE INVESTOR TO SUBMIT AN OFFER TO SUBSCRIBE. NO PERSON MAY PURCHASE THE UNITS OFFERED HEREBY EXCEPT PURSUANT TO AN EXECUTED SUBSCRIPTION AGREEMENT IN THE FORM PRESCRIBED BY THE FUND, AND THEN ONLY FROM A PERSON TO WHOM THE FUND OR ITS DESIGNATED AGENT HAS DELIVERED A COPY OF THIS OFFERING MEMORANDUM.

THESE UNITS ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY NOT BE TRANSFERRED OR RESOLD EXCEPT AS PERMITTED BY THE FUND. INVESTORS SHOULD BE AWARE THAT THEY MAY BE REQUIRED TO BEAR THE FINANCIAL RISKS OF THIS INVESTMENT FOR AN INDEFINITE PERIOD OF TIME. THERE IS CURRENTLY NO PUBLIC MARKET FOR THESE UNITS.

IN MAKING A DECISION TO PURCHASE UNITS HEREUNDER, PROSPECTIVE INVESTORS MUST CONDUCT THEIR OWN INDEPENDENT INVESTIGATION OF THE FUND AND THE TERMS OF THIS OFFERING, INCLUDING THE MERITS AND RISKS INVOLVED, AND ARE ENCOURAGED TO CONSULT WITH THEIR ADVISORS AS THEY WILL BE REQUIRED TO REPRESENT THAT THEY ARE ABLE TO BEAR THE ECONOMIC RISK OF THEIR INVESTMENT AND THAT THEY ARE FAMILLIAR WITH AND UNDERSTAND THE FUNDAMENTAL RISKS AND TERMS OF THIS OFFERING.

NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR MAKE ANY REPRESENTATION WITH RESPECT TO THE OFFERING OF THE UNITS WHICH IS NOT CONTAINED OR REFERENCED HEREIN, AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE FUND. POTENTIAL INVESTORS MAY, IF THEY SO DESIRE, MAKE INQUIRIES OF THE FUND WITH RESPECT TO THE FUND’S BUSINESS OR ANY OTHER MATTERS SET FORTH HEREIN, AND MAY OBTAIN ANY ADDITIONAL INFORMATION WHICH SUCH PERSON DEEMS TO BE NECESSARY IN ORDER TO VERIFY THE ACCURACY OF THE INFORMATION CONTAINED IN THIS MEMORANDUM (TO THE EXTENT THAT THE FUND POSSESSES SUCH INFORMATION OR CAN ACQUIRE IT WITHOUT UNREASONABLE EFFORT OR EXPENSE).

October 24 2020

Confidential Offering Memorandum: Innovative Technologies Group Florida Inc.

PROSPECTIVE INVESTORS ARE CAUTIONED NOT TO CONSTRUE ANY CONTENTS OF THIS OFFERING MEMORANDUM OR ANY PRIOR OR SUBSEQUENT COMMUNICATIONS, AS CONSTITUTING INVESTMENT, LEGAL OR TAX ADVICE; RATHER THEY SHOULD CONSULT THEIR OWN ADVISORS OR COUNSEL WITH THE CAPACITY TO ADVISE AND PROTECT THEIR INTEREST IN CONNECTION WITH ALL MATTERS CONCERNING THIS OFFERING MEMORANDUM.

THIS OFFERING MEMORANDUM DOES NOT KNOWINGLY CONTAIN ANY UNTRUE STATEMENT OF A MATERIAL FACT OR OMIT A MATERIAL FACT, AND ANY SUCH MISSTATEMENT OR OMISSION IS DONE WITHOUT THE KNOWLEDGE OF THE PREPARERS OF THIS DOCUMENT OR THE FUND. AS SUCH THE FUND BELIEVES THAT THIS OFFERING MEMORANDUM CONTAINS A FAIR SUMMARY OF THE MATERIAL TERMS OF ALL MATTERS, DOCUMENTS AND CIRCUMSTANCES MATERIAL TO THIS OFFERING. WHILE THE DATA AND STATEMENTS CONTAINED HEREIN ARE BASED UPON INFORMATION BELIEVED TO BE RELIABLE, NO WARRANTY CAN BE MADE AS TO THE ACCURACY OF SUCH INFORMATION OR THAT CIRCUMSTANCES HAVE NOT CHANGED SINCE THE DATE SUCH INFORMATION WAS SUPPLIED. THIS MEMORANDUM CONTAINS SUMMARIES OF CERTAIN PROVISIONS OF DOCUMENTS RELATING TO THE BUSINESS OF THE FUND AND THE UNITS OFFERED HEREBY, AS WELL AS SUMMARIES OF VARIOUS PROVISIONS OF RELEVANT STATUTES AND REGULATIONS. SUCH SUMMARIES DO NOT PURPORT TO BE COMPLETE AND ARE QUALIFIED IN THEIR ENTIRETY BY REFERENCE TO THE TEXTS OF THE ORIGINAL DOCUMENTS, STATUTES AND REGULATIONS.