CSX.V - Opportunity.


Clean Seed Capital (CSX.V) is known for their Clean Seed’s SMART Seeder™ technologies which are revolutionary seeding tools that utilize the unique synergy of sophisticated electronic metering and intuitive software control putting row-by-row variable rate technology in agricultural innovation.  


CSX.V own a software platform, has a number of patents in precision seeding. The value proposition is relatively simple, reduce waste, promote control, and improve yields while reducing cost.


Coverage was initiated February 2019 with notes in September 2019 and May 2020.


News Releases


July 3- Appoints Deloitte as Auditors: for the Company’s June 30, 2020 fiscal year. Also announces that it has granted 150,000 stock options to a consultant, exercisable at a price of $0.30 per share until December 31, 2023.


Sept 4 - Extends Warrants: Further to its news release of August 28, 2019 regarding a private placement of 6,720,000 units, the Company is proposing to extend the expiry date of 3,360,000 warrants exercisable at $0.50, from September 5, 2020 to January 31, 2021. The proposed extension is subject to the approval of the TSX Venture Exchange.


Oct. 7 - Kelsey Letham Joins the Clean Seed Team: As a corporate advisory consultant, Kelsey lends her expertise to primary stage capital, digital marketing and brand strategy development, in combination with investor relations support for emerging growth companies. In consideration of the services to be provided by Ms. Letham, Clean Seed will pay $7,500 per month and will grant 100,000 stock options exercisable at $0.30 per share for a term of five years. The options will vest as to 25,000 per quarter in accordance with the policies of the TSX Venture exchange.


Oct. 27 - Reports License Revenues of $5,202,501: The Company’s net income in the year ended June 30, 2020 was primarily the result of the license revenues of $5,202,500. The license revenues were the result of issuing a license to AMVAC Chemical Corp. (released April 2, 2020), the first such license issued by the Company since its inception.


Nov. 5 - Glenn Gatcliffe Joins Clean Seed Capital’s Board of Directors:


It is my distinct pleasure to welcome Glenn Gatcliffe to our board of directors, Glenn brings a wealth of knowledge and value to Clean Seed as an independent board member. As we ramp up production and continue to evaluate M&A activities, Glenn will be a valued participant” - CSX.V' s CEO.


Mr. Gatcliffe was granted incentive stock options to acquire 0.2M shares at a price of $0.30 until December 31, 2023.


Nov. 25 - Broadens Patent Protection Expanding IP Portfolio:


Variable Rate Metering Expansion

The Company’s Variable Rate Metering patent (issued Jan 2019) secures Clean Seed’s ability to micromanage precision seeding and planting operations of multiple product inputs on every square foot of a farmer’s field. Recently, CSX.V received notice of allowance from the Canadian Patent Office for two additional applications it submitted to broaden the claims within the Variable Rate Metering Patent. These allowed applications cover key aspects of the Company’s SMART Cart™ technology and its Digital Metering Systems (marketed as Cushion Drive™).


Product Delivery System Innovation Patent Filing

Product delivery refers to how product is received by the SMART Seeder™. During the past 18 months CSX.V has developed an advanced proprietary synergistic product delivery system which has been field tested throughout 2020. The system provides for considerable flexibility for farm inputs. The novel product delivery system is now standard on the SMART Seeder MAX™ and MAX – S™ and will be applied on future product variants. The Company has filed for patent protection for all aspects of this proprietary product delivery system.


Flow Control Patent Grant

The flow control is the core innovation of the on-demand air system on the SMART Seeder™ technology. CSX.V has received notification from the Ukraine Patent Office that its flow control patent application has been approved for grant. Concurrently, CSX.V has submitted additional patent application to broaden the coverage of its flow control patent in Ukraine and anticipates filing similar divisional applications in other major agricultural countries.


Additionally, CSX.V held an initial virtual launch of the SMART Seeder MAX-S™ technology at the Virtual Precision Agriculture Conference 2020 which can be viewed here.


Dec. 9 - Premieres "The Seed of an Idea - Grows the Next Generation": The short film lays out the core of who we are, where we are going with the SMART Seeder MAX-S™ technology and the people that use them.


Also wish to highlight the initial virtual launch of the SMART Seeder MAX-S™ technology at the Virtual Precision Agriculture Conference in November 2020 entitled “SMART Seeder MAX-S™ - The SMARTEST Seeder on Earth™”.


Jan. 29 - Extends Warrants. CSX.V has made application to the TSX Venture Exchange to extend the expiry date of an aggregate 7,895,000 share purchase warrants (the “Warrants”) exercisable at $0.50 per share, to July 30, 2021.


The Company also announced that it has granted an officer the option to acquire 154,000 shares of common stock at a price of $0.40 per share until December 31, 2023.


Summary


Appointment

Kelsey Letham joined as an advisory consultant while Glenn Gatcliffe joined the Board of Directors in November.


Earnings

In October, CSX.V reported a net income of $5.2M which was primarily from its license to AMVAC Chemical Corp.


Patent

CSX.V disclosed a number of advancement with some of its key technologies: Variable Rate Metering Expansion (Patent Allowance Notice), Product Delivery System Innovation (Patent Filing) and Flow Control (Patent Granted).


Product Launch

In November, The SMART Seeder MAX-S™ technology was launched at the Virtual Precision Agriculture Conference.


In Short

Clean Seed Capital is getting momentum on multiple fronts. The company made some key appointments, reported significant licence revenue, and added patents. More importantly, CSX.V finally launched the SMART Seeder MAX-S.


In Early August, CSX.V's CEO made a presentation on Proactive ONE2ONE Investor Forum. Below is a summary.


SMART Seeder MAX-S has the ability to blend multiple products (inoculant, fertilizer, seeds) within a foot sq grid. In essence, it is precision agriculture that enables farmers with the capacity to micro manage what goes into the ground. SMART Seeder MAX-S aims to disrupt traditional Air Seeders through Hardware and Software (SeedSync) to manage delivery of a given or prescribed product mix. The total addressable market in North America is $5 Billion.*


As a recap, the JV with Norwood enables CSX.V to manufacture while Rocky Mountain Equipment will provide distribution. SMART Seeder MAX-S initial cited target price was $0.7M per unit which is in par with Air Seeders.


CSX.V will soon start to take orders for the next season, and also aims to have "extra inventory". While North America is the initial market targeted, Brazil and Australia are considered for the next phase.


In addition to breaking new grounds with the SMART Seeder MAX-S, CSX.V's CEO also indicated the intention to apply its technology in the retrofit market. There are over 14,000 Air Carts in use in the US and Canada.


2021 Outlook

In the last MD&A, CVX.V disclosed a number of target activities for the 2021 fiscal year. The top three were: 1) Assessing the results of the fall testing of the SMART Seeder MAX-S prototype and determining the spring 2021 SMART Seeder MAX-S unit specifications and production program . 2) Pursuing limited early adopter sales during the 2021 calendar year. 3) Evaluating the performance of the 2021 SMART Seeder MAX-S, and planning the sales, marketing and production activities for the 2022 SMART Seeder MAX and MAX-S.


CVX.V appears to be well on its way to initial commercialization in 2021. Currently priced below AMVAC's investment ($0.40 cents) and upcoming warrant ($0.50 cents), CSX.V is considered to be a good opportunity.

DISCLAIMER: The work included in this article is based on current events, technical charts, and the author’s opinions. It may contain errors, and you shouldn’t make any investment decision based solely on what you read here. This publication contains forward-looking statements, including but not limited to comments regarding predictions and projections. Forward-looking statements address future events and conditions and therefore involve inherent risks and uncertainties. Actual results may differ materially from those currently anticipated in such statements. The content of rally is provided for informational and entertainment purposes only and is not a recommendation to buy or sell any security. Always thoroughly do your own due diligence and talk to a licensed investment adviser prior to making any investment decisions - rally cannot take responsibility for your investment decisions.

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