Ms. Linda Sampson reports
Marapharm Ventures Inc. is providing an update of operations in California concerning its acquisition of an approved conditional use permit (CUP) for 29,193 square feet of cannabis located in California.
Marapharm announces it has entered into an agreement to purchase property located in Desert Hot Springs, Calif., for $1.3-million (U.S.). The agreement is without contingencies and closes May 31, 2017. The 1.22 acres is zoned industrial for cannabis cultivation and is an approved CUP of 29,193 square feet for cultivation including 2,036 square feet of processing.
Marapharm engaged Kurt Keating to do the evaluation of this project. Mr. Keating won two High Times cannabis cups in 2014 while cultivating medical cannabis and he has been consulting, evaluating and growing cannabis for several years. The market price for this type of marijuana at present is approximately $1,000 wholesale per pound in California. The evaluation for the main floor is 5,000 pounds per year. The upper floor is for 15,000 pounds per year. The additional value of the extractions enables the facility to have $17-million in annual sales. This evaluation will be part of the financial package for a loan facility for the purchase of the property and for the build-out of the property which is expected in short order.
"The permit processing for marijuana is a lengthy procedure. This acquisition is well under way in the process. Items which are completed include the required orientation meeting, development agreement, conditional use permit, preliminary review (street improvements, water retention and capacity, utilities, setbacks, grading, fire suppression, fences, walls etc.), agreement submissions, application preparations and submissions, architecture and landscape review, environmental submissions and review, city attorney review, planning commission approvals, city council, and several other steps. We have all of the trades, architect, engineers, contractors and consultants in place and we are moving ahead at a fast pace," said Linda Sampson, Marapharm chief executive officer.
Marapharm announces it has entered into an agreement for a transportation and delivery service located in Palm Desert, Calif., to now be known as Marapharm Delivery Cooperative, Inc. which is a corporation organized under the Cooperative Corporation Law of California. The specific and limited purpose of this corporation is to facilitate or co-ordinate cannabis transactions between patient members and primary caregivers. The transaction costs, fees and office are $300,000 (U.S.). City licences for operations are in hand and or in the application stage in San Diego, Los Angeles, Palm Springs, Palm Desert, Desert Hot Springs and other cities within Riverside County, Calif.
Marapharm announces that, further to its news releases dated Nov. 16, 2016, and Nov. 21, 2016, Marapharm had entered into agreements to purchase cannabis properties and that it is not proceeding with the transactions. Cathedral City, Calif., put a 45-day moratorium on the cannabis businesses and licences Nov. 25, 2016, which subsequently has been extended which caused uncertainty to the company.
Marapharm announces that, further to its news release dated Feb. 20, 2017, Marapharm entered into an agreement to purchase a medical delivery service from Moringa Cooperative, Inc. and that it is not proceeding with the transaction because of the findings during the due diligence phase.
Marapharm announces that, further to its news releases dated Sept. 28, 2016, Oct. 11, 2016, and Nov. 14, 2016, it has amended the terms of its previously announced bond offerings for its Nevada and Washington subsidiaries. Due to the delay in closing both offerings, Marapharm has cancelled the $10-million (U.S.) bond offering for its Washington subsidiary and will close on a portion of the $5.5-million (U.S.) bond offering for its Nevada subsidiary. The terms of the Nevada bond offering provide for the issuance of secured convertible bonds at an issue price of $10,000 (U.S.) per bond, bearing compound interest at the annual rate of 8.5 per cent until the maturity date of 24 months from the closing date. The proceeds from the bond offering will be used as a debt facility for Marapharm Las Vegas, LLC (MLV) and the bonds will be secured by the assets of MLV, which include real property, buildings, three special-use licences for 300,000 square feet of medical marijuana cultivation and equipment. The bonds will be open for prepayment without penalty, with monthly payments of principal and interest beginning four months and a day from the closing date. In addition, Marapharm has agreed to issue a 3-per-cent bonus for each bond issued, such bonus to be payable with Marapharm common shares at a deemed price of 75 U.S. cents per share on the closing date. The bonds, in part or in full, are convertible into common shares of Marapharm. A finder's fee of up to 10 per cent is payable to finders. The expected closing date of the bond offering is subject to trustee approval. Marapharm has agreed to accrue interest on the bonds for the first month commencing March 31, 2017, as a result of the delay in closing the offering.
About Marapharm Ventures Inc.
Marapharm has 300,000 square feet of medical marijuana licences for its land and facilities in Washington and Nevada. About 2-1/2 years ago, Marapharm applied in Canada to Health Canada for a marijuana for medical purposes regulations (production and sales) licence and has passed the necessary security clearances. The application is being considered.
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