Altria to Make Growth Investment in Cronos Group

Altria to Invest USD $1.8 Billion (CAD $2.4 Billion) for 45% Ownership Interest in Leading Global Cannabinoid Company with Warrant to Increase Ownership to 55% Over Next 4 Years

VIRGINIA: Altria Group, Inc. announced that it has entered into an agreement to acquire newly issued shares in Cronos Group Inc., a leading global cannabinoid company, headquartered in Toronto, Canada. The transaction represents a 45% equity stake in Cronos Group, at a price of CAD $16.25 per share, for an aggregate investment by Altria of approximately USD $1.8 billion.1

As part of the agreement, at closing, Altria will have the right to nominate four directors, including one independent director, to serve on Cronos Group’s Board of Directors, which will be expanded from five to seven directors. The agreement includes a warrant to acquire an additional ownership interest in Cronos Group at a price of CAD $19.00 per share exercisable over four years from the closing date. If exercised in full, the warrant would increase Altria’s ownership in Cronos Group by 10% to approximately 55%.

“Investing in Cronos Group as our exclusive partner in the emerging global cannabis category represents an exciting new growth opportunity for Altria,” said Howard Willard, Altria’s Chairman and Chief Executive Officer. “We believe that Cronos Group’s excellent management team has built capabilities necessary to compete globally, and we look forward to helping Cronos Group realize its significant growth potential.”

“Altria is the ideal partner for Cronos Group, providing the resources and expertise we need to meaningfully accelerate our strategic growth,” said Mike Gorenstein, Cronos Group’s Chairman, President and Chief Executive Officer. “The proceeds from Altria’s investment will enable us to more quickly expand our global infrastructure and distribution footprint, while also increasing investments in R&D and brands that resonate with our consumers. Importantly, Altria shares our vision of driving long-term value through innovation, and we look forward to continuing to differentiate Cronos Group in this area.”

This investment positions Altria to participate in the emerging global cannabis sector, which it believes is poised for rapid growth over the next decade. It also creates a new growth opportunity in an adjacent category that is complementary to Altria’s core tobacco businesses.

Altria expects its investment to help Cronos Group accelerate its growth strategies and its R&D and intellectual property development. Additionally, Altria will provide expertise to help Cronos Group thrive in the growing global cannabis market. These services may include regulatory affairs, regulatory science, compliance, government affairs and brand management.

About Cronos Group

Cronos Group is a globally diversified and vertically integrated cannabis company with a presence across five continents. Cronos Group operates two wholly-owned Canadian licensed producers: Peace Naturals Project Inc., which received the first non-incumbent medical cannabis license granted by Health Canada, and Original BC Ltd., which is based in the Okanagan Valley, British Columbia. Cronos Group operates a portfolio of brands which includes Peace Naturals, a global medicinal brand and two Canadian adult-use recreational brands, COVEand Spinach. Cronos Group has multiple international production and distribution platforms across five continents.

Cronos Group is establishing infrastructure to create an efficient global production footprint and a diversified global sales and distribution network. Cronos Group is focused on creating and monetizing disruptive intellectual property and growing a portfolio of iconic brands that resonate with consumers. Cronos Group is committed to building an industry-leading business that transforms the perception of cannabis and responsibly elevates the consumer experience.

Cronos Group has no U.S. operations, and cannabis remains illegal at the federal level. Through Cronos Group, Altria is better positioned should cannabis become federally permitted.

Transaction Structure

Under the terms of the agreement, at closing Altria will pay CAD $16.25 per share of Cronos Group stock issued in the transaction, or a 41.5% premium to the 10-day volume weighted average price of CAD $11.48 on the TSX as of November 30, the last unaffected trading day prior to when Cronos Group announced it was in preliminary discussions with Altria regarding a possible investment in Cronos Group. The transaction will result in an aggregate investment by Altria at closing equal to approximately USD $1.8 billion in cash (approximately CAD $2.4 billion).1Altria will receive shares representing a 45% interest in Cronos Group.

The agreement also includes a warrant to acquire additional ownership interest in Cronos Group at a price of CAD $19.00 per share exercisable over the next four years. If exercised in full, the warrant would increase Altria’s ownership in Cronos Group by 10% to 55%. The aggregate exercise price for the warrant is equal to approximately USD $1.0 billion (approximately CAD $1.4 billion),1 subject to customary adjustments.

The transaction is subject to customary closing conditions, including Cronos Group shareholder approval and receipt of regulatory approvals, which will be pursued promptly. The transaction is expected to close in the first half of 2019. At closing, Cronos Group will remain a Canadian publicly-traded company headquartered in Toronto, Canada and continue to be led by its existing management team.

A copy of the agreement containing the terms of the transaction will be filed with the Securities and Exchange Commission (SEC) and Canadian regulatory authorities.

Financing & Advisors

Altria has received committed financing totaling approximately CAD $2.4 billion from JPMorgan Chase Bank, N.A. Altria may consider seeking permanent financing in the future.

Perella Weinberg Partners LP is the financial advisor to Altria. Wachtell, Lipton, Rosen & Katz and Goodmans LLP are providing legal counsel to Altria for the deal. Hunton Andrews Kurth LLP is providing legal counsel to Altria regarding the financing.

Lazard Ltd. is the financial advisor to Cronos Group. Sullivan & Cromwell LLP and Blake, Cassels & Graydon, LLP are providing legal counsel to Cronos Group for the deal.

FTC Announces Crackdown On Deceptively Marketed CBD Products

Companies made unsupported claims that their oils, balms, gummies, coffee, and other goods could treat serious diseases such as cancer and diabetes

DISTRICT OF COLUMBIA: The Federal Trade Commission today announced the first law enforcement crackdown on deceptive claims in the growing market for cannabidiol (CBD) products. The FTC is taking action against six sellers of CBD-containing products for allegedly making a wide range of scientifically unsupported claims about their ability to treat serious health conditions, including cancer, heart disease, hypertension, Alzheimer’s disease, and others.

The FTC is requiring each of the companies, and individuals behind them, to stop making such unsupported health claims immediately, and several will pay monetary judgments to the agency. The orders settling the FTC’s complaints also bar the respondents from similar deceptive advertising in the future, and require that they have scientific evidence to support any health claims they make for CBD and other products.

“The six settlements announced today send a clear message to the burgeoning CBD industry: Don’t make spurious health claims that are unsupported by medical science,” said Andrew Smith, Director of the FTC’s Bureau of Consumer Protection. “Otherwise, don’t be surprised if you hear from the FTC.”

The crackdown, Operation CBDeceit, is part of the Commission’s ongoing effort to protect consumers from false, deceptive, and misleading health claims made in advertisements on websites and through social media companies such as Twitter.

Each case the FTC is announcing today is described below:

Bionatrol Health, LLC

According to the FTC’s complaint against Utah-based companies Bionatrol Health, LLC and Isle Revive, LLC, and two former managers and owners, since at least December 2019 the respondents sold a CBD oil to consumers on two websites. Among other things, the respondents allegedly claimed without substantiation that their CBD product is safe for all users, treats pain better than prescription medications like OxyContin, and prevents and treats age-related cognitive decline and chronic pain. The respondents also claimed, without scientific evidence, that CBD oil is “medically proven” to improve a variety of conditions, according to the FTC’s complaint. In addition, the FTC alleges the respondents deceived consumers who ordered one bottle of their CBD oil by changing the order to five bottles without consumers’ consent.

The proposed administrative order settling the FTC’s charges prohibits the respondents from making certain prevention, treatment, or safety claims about dietary supplements, foods, and drugs without human clinical testing to substantiate the claims. It also requires competent and reliable scientific evidence for other health-related product claims, and prohibits the respondents from misrepresenting the cost of any good or service and from charging consumers without their express, informed consent. Finally, it requires the corporate respondents and individual respondent Marcello Torre to pay $20,000 to the FTC and to notify consumers of the Commission’s order.

Epichouse LLC (First Class Herbalist CBD)

According to the FTC’s complaint against Utah corporation Epichouse, LLC, which operated under several names, including First Class Herbalist, and the company’s founder and owner, John Le, since at least September 2019 the respondents sold several CBD products on their website, including oils, a pain-relief cream, coffee, and gummies.

Among other alleged unsupported claims, Epichouse and Le promoted CBD as safe for all users, able to treat pain better than prescription medications such as OxyContin, and able to prevent a wide range of serious conditions, including cancer, diabetes, and heart disease. In their advertising, they also falsely claimed that CBD is scientifically proven to improve many serious health conditions—including chronic pain and hypertension—and provide neurological benefit—such as preventing age-related cognitive decline—according to the FTC’s complaint.

The proposed administrative order settling the FTC’s charges prohibits the respondents from making certain prevention, treatment, or safety claims about dietary supplements, foods, and drugs, unless they have the human clinical testing to substantiate the claims. It requires them to have competent and reliable scientific evidence when making any other health-related product claims. Finally, the order requires the respondents to pay $30,000 to the FTC and notify consumers of the Commission’s order.

CBD Meds, Inc.

According to the FTC’s complaint against CBD Meds, Inc.; G2 Hemp, Inc.; and Lawrence Moses, a/k/a Lawrence D. Moses, Jr., individually and as an officer of the corporate entities, the two companies advertised CBD oil on their website and on YouTube. In their ads, the FTC contends, the Winchester, California-based firms made a number of false or unsubstantiated claims, including that CBD effectively treats, prevents, or mitigates serious diseases and conditions like artery blockage, cancer, glaucoma, autism, and schizophrenia, among many others. The respondents also falsely represented that some of the efficacy claims were scientifically proven or that the U.S. government has confirmed the health benefits of CBD.

The proposed administrative order settling the FTC’s charges prohibits the respondents from making certain prevention, treatment, or safety claims about dietary supplements, foods, and drugs, unless they have the human clinical testing to substantiate the claims. More broadly, it requires them to have competent and reliable scientific evidence when making any other health-related product claims. Finally, the order requires the respondents to notify consumers of the Commission’s order.

HempmeCBD

According to the FTC’s complaint against EasyButter, LLC, also d/b/a HempmeCBD, and its owner and officer Michael Solomon, since at least January 2018, the respondents have sold CBD products on their website, including CBD-infused shea butter, gummies, lozenges, honey sticks, vape pens, and oils. The complaint alleges that HempmeCBD claimed its CBD products could treat or cure serious ailments like cancer-related symptoms, substance abuse, and AIDS. The complaint alleges HempmeCBD lacked the scientific substantiation for such health claims and falsely claimed to have studies showing CBD is effective at treating autism.

The proposed administrative order settling the FTC’s charges prohibits the respondents from making certain prevention, treatment, or safety claims about dietary supplements, foods, and drugs, unless they have the human clinical testing to substantiate the claims. It also requires them to have competent and reliable scientific evidence when making any other health-related product claims. Finally, it requires the respondents to pay the FTC $36,254 and to notify consumers of the Commission’s order.

Reef Industries, Inc.

According to the FTC’s complaint against California-based Reef Industries, Inc.; Cannatera, Inc.; AndHemp, Ltd., and the companies’ three principals, the respondents have sold a variety of CBD products directly to consumers on their website and Twitter accounts since at least January 2019 and misrepresented the health benefits of CBD. The FTC alleges that the respondents made unsubstantiated claims that CBD can prevent, cure, mitigate, or treat diseases and serious health conditions, including Alzheimer’s disease, arthritis, autoimmune disease, and irritable bowel syndrome. The complaint also alleges the respondents falsely claimed that studies or scientific research prove that CBD is effective at treating, curing, or mitigating these diseases and conditions.

The proposed administrative order settling the FTC’s charges prohibits the respondents from making certain prevention, treatment, or safety claims about dietary supplements, foods, and drugs, unless they have the human clinical testing to substantiate the claims. More broadly, it requires them to have competent and reliable scientific evidence when making any other health-related product claims. Finally, it requires them to pay the FTC $85,000 and notify consumers of the Commission’s order.

Steves Distributing, LLC

According to the FTC’s complaint against Steves Distributing, LLC, d/b/a Steve’s Goods; and the company’s CEO Steven Taylor Schultheis, since beginning operations in 2018, the respondents have sold a variety of products containing both CBD and cannabigerol (CBG), which, like CBD, is a non-psychoactive compound derived from hemp. The company advertises its CBD and CBG products, including tinctures, gummies, capsules, topical balms, suppositories, bath balms, and coffee, on its website and through social media companies like Twitter.

The FTC alleges that the respondents claimed, without adequate substantiation, that their CBD and CBG products are effective alternatives to prescription medications and treat a wide range of diseases and serious health conditions, including Alzheimer’s disease, cancer, and diabetes. The complaint also alleges the respondents falsely claimed that their CBD and CBG products have antibacterial properties, prevent or reduce the risk of heart attacks, strokes, and other diseases, and that certain of these claims were supported by scientific evidence.

The proposed administrative order settling the FTC’s charges prohibits the respondents from making certain prevention, treatment, or safety claims about dietary supplements, foods, and drugs, unless they have the human clinical testing to substantiate the claims. More broadly, it requires them to have competent and reliable scientific evidence when making any other health-related product claims. Finally, it requires the respondents to pay the FTC $75,000 and notify consumers of the Commission’s order.

The Commission votes approving each of the six administrative complaints and proposed consent orders were 5-0, with Commissioner Rohit Chopra and Commissioner Christine S. Wilson issuing separate, concurring statements. A complete list of respondents can be found in the complaint for each respective case.

The FTC will publish a description of the consent agreement package in the Federal Register soon. The agreement will be subject to public comment for 30 days after publication in the Federal Register after which the Commission will decide whether to make the proposed consent order final. Instructions for filing comments will appear in the published notice. Once processed, comments will be posted on Regulations.gov.

NOTE: The Commission issues an administrative complaint when it has “reason to believe” that the law has been or is being violated, and it appears to the Commission that a proceeding is in the public interest. When the Commission issues a consent order on a final basis, it carries the force of law with respect to future actions. Each violation of such an order may result in a civil penalty of up to $43,280.

Medical Marijuana, Inc Subsidiary HempMeds Brasil Sponsors Autism Event At Rice University In Houston

 CALIFORNIA: Medical Marijuana, Inc., the first-ever publicly traded cannabis company in the United States that launched the world’s first-ever cannabis-derived nutraceutical products, brands and supply chain, announced today that its subsidiary HempMeds Brasil, in partnership with the Consulate General of Brazil in Houston, sponsored “Autism Together We Are Stronger” at Rice University on February 22.

“We see events like this one as prime opportunities to educate people on what cannabidiol, or CBD, is and its potential benefits,” said HempMeds® Brasil Vice President Caroline Heinz. “CBD can be legally imported in Brazil and is even subsidized by the Brazilian government for many indications including autism. We want to do everything we can to help bring awareness to current research that is being conducted on how CBD can be used by people around the world.”

In addition to sponsoring the event, HempMeds® Brasil shared the event stage with two researchers who the Company has worked with frequently in the past, Dr. Alysson Muotri, Professor at the School of Medicine, University of California in San Diego, and Dr. Abram Topczewski, Neuropediatrician and Enuresis Clinic Director at the Albert Einstein Hospital.

“Education is the most important thing when it comes to helping the world become more accepting of cannabis and its compounds,” said Medical Marijuana, Inc. CEO Dr. Stuart Titus. “We’re proud to be able to sponsor events like these and work with such prestigious doctors such as Dr. Muotri and Dr. Topczewski to help further medical research around the world.”

iAnthus Expands Nevada Footprint With Agreement To Acquire Vertically Integrated Northern Nevada Operator

NEVADA:  iAnthus Capital Holdings, which owns, operates, and partners with best-in-class regulated cannabis operations across the United States, announced that its U.S. subsidiary has entered into an agreement to acquire WSCC, Inc. (“Sierra Well“), a leading Nevada-based vertically licensed cannabis company with two dispensary locations and over 20,000 square feet of cultivation/production facilities in Reno and Carson City.

The acquisition will enhance iAnthus’ presence and accelerate growth efforts in Nevada, which represents an approximately US$640 million adult-use and medical cannabis market growing at over 20% annually, based on data made publicly available by the Nevada Department of Taxation. In conjunction with its current operations, iAnthus’ footprint will be as follows:

  • 6 dispensary Nevada licenses across the state, which includes two currently operating dispensaries under the Sierra Well brand.
  • 50,000 square feet of Nevada cultivation and processing capabilities to further capitalize on strong production and distribution capabilities in the state (MPX-branded products, including award-winning concentrates and recently launched edibles, are currently sold in over 40% of dispensaries in Nevada).
  • Pro forma open dispensary count of 29 stores nationwide.

Sierra Well was founded in 2014, and opened its Reno location in 2015 and its Carson City location in 2016. On an unaudited standalone basis (prepared in accordance with US GAAP), Sierra Well’s last quarter annualized revenue was approximately US$16 million with an EBITDA (non-IFRS) margin above 20% and positive net income.

The transaction is expected to close in the first half of 2020, subject to customary regulatory approvals including approval of the license transfers by the Nevada Department of Taxation. Upon closing of the transaction, the Sierra Well dispensaries will be renamed under the Company’s Be. brand, which is being launched nationwide in October 2019.

“Strengthening our foothold in one of the most successful adult-use cannabis markets is consistent with our strategy to deliver iAnthus’ nationally recognized products in premier markets,” said Hadley Ford, CEO of iAnthus. “This strategic transaction will allow us to scale our Nevada operations, add talent, and solidify both our retail and brand presence in both the Northern and Southern portions of the state.”

“We’re excited to join the iAnthus team and look forward to expanding our business with the expertise of a tried and tested multi-state operator,” said Steven Nightingale, Chairman of the Board of Sierra Well. “We at Sierra Well see this partnership as a perfect fit, one that will allow our dynamic workforce to deepen their ability to provide top-notch service and products to the communities of Reno and Carson City.”

Cannabis Real Estate Firm Bangi Appoints Destiny’s Child Founder Chief Marketing Officer

CALIFORNIA: BANGI, INC, a diversified investment vehicle that acquires and leases specialized real estate assets in the cannabis, hemp and CBD industries, today announced the appointment of Dr. Mathew Knowles to the newly created position of Chief Marketing Officer (CMO), effective immediately.  Founder of Destiny’s Child, Dr. Mathew Knowles, is an author, professor, public speaker, entrepreneur, music executive, artist manager and founder of Music World Entertainment, a 25-year entertainment company with over $450 million in record sales.  Dr. Knowles was recently featured in an interview with Forbes Magazine which can be found here.

As the CMO for BANGI, Dr. Knowles will be responsible for developing and overseeing the launch of BANGI’s global marketing campaign, including advertising, branding, communications, content, creative services, digital strategies, press events, social media and the web.  

“As one of the world’s most successful music and entertainment pioneers, Mathew is a relentlessly innovative and creative marketing leader whose experience will ensure our success in the rapidly-growing and dynamic cannabis industry,” said Dr. Neil Parsan, Chairman and Chief Executive Officer of BANGI, Inc.  “Under his leadership, we are looking forward to launching and developing one of the strongest and most trusted brands in the cannabis industry based on our ability to deliver real value to our tenants, partners and shareholders,” concluded Dr. Parsan.

“I have been blessed throughout my career to work with various artists and companies at defining moments in their histories, which is why the opportunity to lead the marketing program at BANGI was so compelling,” said Dr. Knowles.  “BANGI has a strong culture and strategic foundation, and I look forward to leveraging my extensive network and experience to building upon the Company’s momentum through innovative and breakthrough marketing strategies that are designed to achieve sustainable growth and profitability,” concluded Dr. Knowles. 

Innovative Industrial Properties Acquires California Property Portfolio And Enters Into Long-Term Leases With Licensed Operator

Acquisition Represents IIP’s Second Investment in California, Expanding Footprint to 18 Properties in 11 States

CALIFORNIA: Innovative Industrial Properties, Inc., the first and only real estate company on the New York Stock Exchange (NYSE: IIPR) focused on the regulated U.S. cannabis industry, announced today that it closed on the acquisition of a five-property portfolio in southern California, which comprises approximately 102,000 square feet of industrial space. This acquisition marks IIP’s second investment in California, following on IIP’s acquisition in Sacramento earlier this year.

The purchase price for the southern California portfolio was approximately $27.1 million in the aggregate (excluding transaction costs). Concurrent with the closing of the purchase, IIP entered into a long-term, triple-net lease at each property with a licensed operator, which intends to continue to operate the properties as licensed cannabis cultivation, manufacturing, processing and distribution facilities in accordance with California regulations.

As the pioneering real estate investment trust (REIT) for the medical-use cannabis industry, IIP partners with experienced medical-use cannabis operators and serves as a source of capital by acquiring and leasing back their real estate assets, in addition to offering other creative real estate-based capital solutions.

“We are excited to forge this new tenant relationship with one of the preeminent licensed operators in southern California,” said Paul Smithers, President and Chief Executive Officer of IIP. “This operator is a true innovator in the industry, developing a strong brand that is recognized for its consistent high quality, and we are thrilled to team with them as their long-term real estate partner. The California regulated cannabis market is poised for explosive growth in the coming years, as the regulated program continues to roll out and a focus is made on transitioning illicit sales to the regulated marketplace.”

The operator is licensed for cannabis cultivation, nursery, manufacturing, processing, delivery and distribution. With its advanced growing techniques, state-of-the-art facilities and research and development for the creation of new proprietary genetics, the tenant has developed a distinguishing brand in the southern California market, including botanicals, concentrates and accessories.

As of April 16, 2019, IIP owned 18 properties located in Arizona, California, Colorado, Illinois, Maryland, Massachusetts, Michigan, Minnesota, New York, Ohio and Pennsylvania, totaling approximately 1,230,000 rentable square feet (including approximately 159,000 rentable square feet under development/redevelopment), which were 100% leased with a weighted-average remaining lease term of approximately 14.9 years. As of April 16, 2019, IIP had invested approximately $191.3 million in the aggregate (excluding transaction costs) and had committed an additional approximately $34.7 million to reimburse certain tenants and sellers for completion of construction and tenant improvements at IIP’s properties. IIP’s average current yield on invested capital is approximately 14.9% for these 18 properties, calculated as (a) the sum of the current base rents, supplemental rent (with respect to the lease with PharmaCann LLC at one of IIP’s New York properties) and property management fees, divided by (b) IIP’s aggregate investment in these properties (excluding transaction costs and including aggregate potential development/redevelopment funding and tenant reimbursements of approximately $34.7 million).

 

Mentor Capital Adds Three Cannabis Investments in Two Months

CALIFORNIA: Mentor Capital announced that its investment in G FarmaLabs Limited has increased to $2,700,000 following yesterday’s seventh investment tranche delivered to G Farma of $250,000 from Mentor for additional leased equipment and working capital. In addition to receiving consulting fees, repayment, interest, and lease payments, Mentor has captured a $1 option for a 3.75% equity interest in the G Farma Family of Businesses. Nicole Gonzalez, Founder of G FarmaBrands, comments, “With financial backing from Mentor Capital, G FarmaLabs has hit its benchmarks on the way to building cannabis efficient facilities and production lines.” Ata Gonzalez, Co-Founder of G FarmaLabs concludes, “Chet provides both money and a wealth of knowledge. We feel blessed to have this strategic relationship.”

“Mentor Capital focuses new investment from shareholders and other investors on larger cannabis companies, like G Farma, that have the potential to go public and who may be incubated by Mentor along that path,” explained Mentor Capital, Inc. CEO, Chet Billingsley. “We look to act as a holding company of operating entities, not an investment company, and have no plans to buy cannabis shares from the public market at normal market prices. However, on 24-hour notice and hence at a significant discount, Mentor will buy public shares from marijuana-related consultants, institutions, or accredited investors that Mentor has known for years.”

The Company reports that in the last two months, Mentor has increased its holding in SolisTek to 300,000 shares by the purchase of an additional 90,000 common shares. Mentor recently has purchased 400,000 shares of GB Sciences, Inc. plus an extra 400,000 of their warrants. Mentor also holds from earlier buying activity approximately a combined $240,000 in shares of GW Pharmaceuticals, Plc. and Kush Bottles, Inc.

MassRoots Files Suit Against Former CEO

COLORADO: MassRoots, Inc., a leading technology platform for the legal cannabis industry, announced that on November 14, 2017 it filed a lawsuit in District Court in Denver, Colorado against its former CEO, Isaac Dietrich. The complaint alleges, among other things, that Dietrich intentionally misappropriated Company funds and engaged in self-dealing by causing MassRoots to make unauthorized payments to him and third parties on his behalf, for his personal benefit, in various amounts totaling in excess of $250,000, which also constituted a wrongful conversion and civil theft of Company funds, and that Mr. Dietrich has been unjustly enriched as a consequence of the foregoing.  The complaint also alleges that Dietrich has intentionally violated the Separation Agreement he signed with the Company.

Scott Kveton, MassRoots CEO, stated “The days of Isaac Dietrich treating this Company like his personal piggybank are over.  It is not surprising to us that only a few days after we filed our lawsuit against him, he filed a preliminary proxy statement with the SEC with the intent to remove the Board and retract the lawsuit against him.  I have faith that the shareholders of this Company will see through this ruse and recognize the folly of putting Dietrich back in charge.”

Kveton continued, “Our last fiscal quarter was the worst quarter MassRoots ever recorded, and it was all Isaac Dietrich’s doing.  Moreover, misappropriation of Company funds and illegal drug use at the workplace are unacceptable on any level.  We intend to enforce the standstill provisions of the Separation Agreement as we believe engaging in a protracted proxy contest now would be a huge waste of our Company resources and a diversion by Isaac Dietrich to avoid the potential consequences of his wrongdoings. We have also been in touch with the appropriate local and Federal authorities on these matters.”

Marapharm Is Building A Third Facility In Las Vegas

CANADA: Marapharm Ventures Inc. has announced construction plans for a third building which will be 65,635 square feet on the 7 acre property located in Las Vegas, adjacent to 2 existing cultivation buildings. The ground prep pad is ready to build on, most infrastructure is designed and in place and building plans go for bid in October 2017. Construction will begin soon thereafter. This building is slated to be the first 3 story cannabis building in the state of Nevada.

“Current pricing and comparable facilities in Nevada indicate that revenue from the new 3 story building will potentially be $50 million gross and $30 million net, after operating costs, for the first year (source Kurt Keating). We will be at about 20% build out with regard to the square footage of the licenses we have.  Marapharm is the largest marijuana license holder in Nevada.” Linda Sampson, CEO, Marapharm.

Marapharm engaged Kurt Keating to do the evaluation of this project. Kurt won 2 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 $2300 wholesale per pound in Nevada. The evaluation for the three floors is 22,600 pounds per year.

Cannabis Companies Can Earn Positive Media Coverage And Attract New Business

By Bill Bongiorno

Earning positive media coverage by being a source to the media builds credibility and visibility for cannabis companies. Being quoted in a newspaper, magazine or being a guest on TV as an expert source carries a lot of weight with the public.

The media acts as a third-party endorsement. It’s also the best and fastest way to reach a mass audience.

Here are some ways for cannabis companies to earn positive media coverage:

  • News releases – even simple news sent to local media can result in coverage.  For example, a cannabis company announcing a new deal that involves a local company. These two pieces of information can be shared with local regional newspapers and business journals.  These also will find their way on the Internet. Earning positive media coverage will aid search engine optimization to get found by potential consumers and investors.
  • Interviews with reporters covering cannabis are another tool for cannabis companies to be quoted in news stories. Reading current cannabis news and paying attention to who the writers are is essential.  There is cannabis news on a daily basis and cannabis company executives can offer to be expert sources supplying information, guidance and opinion.  Often the writers contact information is available at media websites.
  • Byline articles are another great way for cannabis companies to help the investing public and showcase their financial knowledge.  If you have a regular newsletter or cannabis commentary you send to clients, rework it to get published to a wider audience as a byline piece or guest blog.  Writing articles and letters to the editor that get published in media read by a cannabis company target audience, positions the company as a thought leader.  It displays the value proposition to customers and investors.
  • Follow cannabis writers on Twitter and LinkedIn and interact with them.  Sometimes they post what stories they are working on and the types of sources they need.  This is another way in today’s social media world, to stay connected. It helps to build a relationship to say you’ve read their stories and comment on them. A retweet or sharing a link on LinkedIn and FB is always welcome, particularly with cannabis reporters.
  • Develop news hooks based on the time of year to earn positive media coverage.  With Halloween coming, a story hook on infusing the day with cannabis would be a good topic. When the Christmas season is upon us, a story about a gift that keeps giving, cannabis, would be cool, not to mention as a stocking stuffer.  TV loves these kinds of stories because it offers great visuals. This is another avenue for cannabis companies to gain some positive media coverage. Often having been quoted in the media and having had articles published will help cannabis execs get on TV.  Typically, TV follows print in the stories it covers. Look at the news of the day in print and offer to be a guest talking about a top cannabis news story.

By employing some of these media tactics, cannabis companies can be positioned as experts along with their value propositions. While increasing name recognition, credibility and visibility to attract customers and investors.  Think about earning positive media coverage for your cannabis company today.


 

Bill Bongiorno is President of Blue Chip Public Relations, Inc., a firm specializing in working with financial and alternative investment companies including the cannabis industry.