CANCELLED DUE TO SNOWSTORM. Creating and Protecting CannaMarks, NWMJLaw/MJBAPortland Bootcamp Jan 11th

TONIGHT’S MJBAPORTLAND BOOTCAMP CANCELLED DUE TO SNOWSTORM.

BE SAFE.

WE’LL RESCHEDULE!

OREGON: It’s not enough to grow great weed, or create a better edible, in today’s hyper-competitive cannabis market, it’s all about creating — and protecting — your brand, or “CannaMark.”   Leading industry attorneys NWMJ Law have partnered with the Marijuana Business Association (MJBA) to present their first Bootcamp of the year.

The 2 hour bootcamp will take place on Wednesday, January 11th 2017 6:30 – 8:30pm. at the NWMJLaw offices, 220 NW 8th Avenue, Portland, Oregon.   Open to industry pioneers as well as the public with a $10 suggested donation for this networking event. 

Panelists include NWMJ Law’s Margaret Widlund on Protecting your Brand, NWMJ Law’s Aaron Pelley on Intellectual Property Litigation and KindTyme on Advertising and Marketing.Paneled by visionaries and pioneers in the cannabis industry, these experts will focus on Advertising, Marketing, Trademark, and IP Issues.  This 2-hour event is dedicated to 2017 being the year of brand differentiation.

The MJBA, called the Chamber of Commerce of marijuana by NBC News, focuses on ending prohibition, educating consumers, legitimizing the industry, and expanding the market.  Their partner, NWMJ Law is one of the fastest growing cannabis law firms in the Pacific Northwest and together they work tirelessly to change the face of this growing industry.

“Smart Money” Bootcamp For Cannabis Biz Is August 16th In Seattle

WASHINGTON: Responsible financial management is of critical importance to cash-constrained cannabis entrepreneurs.  Leading cannabis attorneys Aaron Pelley and Anne van Leynseele of NWMJ Law will host “Smart Money” the latest MJBA Seattle Business Bootcamp on Tuesday, August 16th at their new offices at the historic Maynard Building in Pioneer Square, 119 1st Avenue S, Suite 420, Seattle, WA 98104.  Anne and Aaron will lead the audience of legal cannabis business owners and industry participants through an open discussion with stories from the frontline about partnerships, investors, the essentials of business planning, and proactive ways to avoid conflicts.

Eric Camm of Turning Point will present on cannabis business valuations. He will share a critical component to define what partner, investor, and buy-sell deals are worth.

This event, the fourth in a series of bi-monthly MBA Business Bootcamps that NWMJ Law has produced, will cover a wide range of situations that arise in these areas including:

·  Why you must have an Operating Agreement or Shareholder Agreement

·  How can you benefit from an investor and stay safe

·  Ensuring the best partnership relationship

·  Make your business plan work for you

·  What is it all worth, valuations in a new market

·  Avoiding risks and conflict

Do not miss these seasoned cannabis attorneys as they share real world situations and offer their sound advice on how to avoid troubles and tips on solving problems before they cause damage to your company.

nwmjlawnewlogoThe event takes place Tuesday, August 16, 2016, 6:00 to 8:30 PM at the NWMJ Law, PLLC offices in the historic Maynard Building in Pioneer Square: 119 1st Avenue S, Suite 420, Seattle, WA 98104.

 

MJBA and NWMJ Law Rollout “MBA Bootcamps” For Portland Cannabis Professionals

OREGON: Beginning on Wednesday, August 17th, 2016 and continuing through January, 2017, leading cannabis industry attorneys NWMJ Law and the Marijuana Business Association (MJBA) will present a series of “MBA Bootcamps” designed to improve the core business competencies of Oregon’s new crop of legal cannabis entrepreneurs.

With offices in Portland’s historic Custom House, NWMJ Law has been on the front lines of the legal cannabis industry from the beginning. The Seattle-based company was instrumental in helping to shape Washington’s regulated cannabis marketplace, and is taking hard-learned lessons to the Oregon market.  “We made it through the initial volatile launching of this industry, nurturing companies in the highly regulated environment.” NWMJ Law’s Anne Van Leynseele told MJ News Network, “Through this unique experience, NWMJ Law discovered that business owners have need to understand more clearly how to operate efficiently and effectively. We put together a team of qualified professionals who will teach you the basics on the wide range of topics you need to be well-versed on how to run a successful and profitable business.”

The company is “paying it forward” by making this essential knowledge available to the industry at large in an effort to establish best practices. Each session will be two hours, and include short presentations with supporting materials, real world examples, and audience questions.  A handout with key learnings will be distributed to all attendees.

nwmjlawnewlogo

You have the will, now get the skill.  Increase your business literacy.

NWMJLaw & MJBA “MBA Bootcamps For Cannabis Professionals”
NWMJ Law, PLLC – Portland Customs House, 220 NW 8th Ave, Portland, OR 97209

BOOTCAMP SCHEDULE 2016

Managing Your Legal Cannabis Business
Wednesday, August 17 | 4:00-6:00 PM | Event Space 1st Floor

Avoid the Audit and Accounting 101: Understand What You Need to Know
Wednesday, September 14 | 6:00-8:00 PM | Event Space 1st Floor
 
Employee Management and Conflict Resolution
Wednesday, October 12 | 6:00-8:00 PM | Event Space 1st Floor
 
Smart Investing: Choosing a Partner, Profit Sharing, Finding Funding, Developing a Working Business Plan, and Implementing It
Wednesday, November 9 | 6:00-8:00 PM | Event Space 1st Floor

Advertising, Marketing, Trademark, and IP Issues
Wednesday, January 11 | 6:00-8:00 PM | Event Space 1st Floor

MJBA Portland Meetups are FREE to paid MJBA Members, $10 to qualified industry professionals. Join the MJBA here:

 

 

Washington Medical Marijuana After July 1

By Aaron Pelley and Anne van Leynseele

Many clients and potential clients have been asking NWMJLaw about the changes coming to Washington State’s medical marijuana system when the new laws take effect on July 1, 2016. Specifically, we have been asked how the collective garden statute being repealed will affect patients and Farmers’ Markets.

Farmers’ Markets

Across Washington State there are Farmers’ Markets where medical cannabis patients can obtain their medicine without donating to a shop with high overhead, the savings is passed to the patients. These markets have become popular over the last five years because they allow the patients, in most cases, to connect with the grower and gain valuable information about the particular strain they are receiving. The biggest benefit to patients is the price comparison; where a requested donation for 3.5 grams can be as high as $60 dollars at some dispensaries, it is usually $25 dollars directly from the vendor.

Also, patients can choose the grower they like and access a wealth of information. Currently, the defensibility of these markets is under the collective garden model (RCW 69.51a.085). The statute allows up to 10 qualifying patients to participate in one garden. This not only applied to markets, but to access points and “large scale” medical grows. However, the section fell silent on the amount of time the patient must be a member of the garden to be considered a “true member.” So for most markets interested in operating with the least amount of risk, the best method was to rotate members in and out of the garden/vendor. For example, a patient would be sign in at 10:42am conduct their donation, accept their cannabis, and sign out of the garden at 10:45am, leaving space for the next patient to then come “into the garden” as a member.

Under the new system, RCW 65.51a.085 will be repealed and replaced with a medical cooperative model. This marks the end of Farmers’ Markets, Access Points, and “large scale” medical grows. The new medical cooperative garden model changes the system. The biggest change to farmers’ markets specifically by limiting both membership and timelines.

Beginning July 1, 2016, up to four patients who are registered in the DOH database can join together to form a cooperative garden. Patients or designated providers who participate in a cooperative may grow the total number of plants authorized for the participants (6-15) with no more than 60 plants total per tax parcel. The cooperative must be registered with the state and include the names of all participants. If a patient no longer participates in the cooperative, they must notify the LCB within 15 days of the withdrawal from the cooperative. Furthermore, additional patients may not join the cooperative for 60 days starting from the date of notification of the exiting member. This means the basis for the farmers’ markets has been removed. In the eyes of law enforcement anyone participating is just selling pot and can be convicted with little or no defense available.

If you were looking to find a way to serve patients in a market setting as the designated provider, by providing for multiple patients, that was also done away with in 2011. A designated provider may not serve more than one patient within a 15-day period. Simply put, as a market, your options have run out.

Collective Gardens and Scaled Grows.

Over the years, patients, defense attorneys, and even prosecutors got morecreative to address the astonishing number  of patients needing access to an adequate supply of cannabis. Not all patients are able to grow their own cannabis due to medical issues or simply because they lack the skill needed. Standard collective gardens allowed up to 10 patients to come together to grow a maximum of 45 plants. This model allowed large scale grows to operate and ensure every patient could have an adequate supply of RCW 69.51a.085 fell silent on the boundaries of a collective garden. Since a collective garden could only have 45 plants, it became practice that multiple collective gardens could exist on the same property as long as each garden was distinguished from the others.

As of July 1, 2016 this section of the law will be repealed, leaving large scale grows illegal. The collective garden statute is replaced with a new medical cooperative garden model where up to four patients who are entered in the database can join together to form a cooperative garden. Patients and designated providers who participate in a cooperative may grow the total number of plants authorized for the patient (6-15 plants each) and no more than 60 plants total. The cooperative must be registered with the state, include the names of all patients, and located at the home of one of the participating patients. The garden is subject to inspection at any “reasonable” time to ensure compliance with the new limits.

Dispensaries (Access Points)

Since the early 2000s patient access points, commonly know as dispensaries, operated despite repeated bans, raids, polite robberies, and city or county enforced shut downs. The repeal of RCW 69.51a.085 from the Collective Garden Statute will effect the medical marijuana supply chain as it applies to dispensaries. Similar to the Farmers’ Markets model, dispensaries relied on rotating members in-and-out of their collective gardens or some operate as a designated provider. Patients would walk in to the access point/dispensary, have their recommendations verified through an online verification with no need to disclose their qualifying condition, and then signed into the garden to obtain their medical cannabis for their qualifying condition. With the repeal of collective garden statute, the entire medical system is being folded into the recreational market. If they could meet the standard, dispensary owners opted to obtain an LCB license with a medical endorsement or now must close their retail store.

After July 1, 2016, access points will be placed back into the category of outlaws. The legal defense that was artfully crafted over the years is now set to expire and the arguments and tactics that have kept countless people out of jail will expire with them.

Actions that Can Cause Legal and Business Problems

In sum, there is a concise list of activities that should end by midnight June 30, 2016.

• Selling cannabis at farmers’ markets on a “rotating-member model”

• Collective or large scale medical grows

• Any 502 licensee or 502 applicant or license holder should understand the risk to their license should they continue to grow illegally

This memo is made available by NWMJ Law for educational purposes only as well as to provide a general information and a general understanding of the law, not to provide specific legal advice. By providing this letter there is no attorney client relationship between you and NWMJ Law. This letter should not be used as a substitute for legal advice from a licensed attorney in your state.

HONU Wins “Best Cannabis Brand Design” 2016 in MJBA/OMD Poll.

WASHINGTON:  Cowlitz county Tier 3 producer HONU was named “Best Cannabis Brand Design 2016” in an online poll published by Marijuana Business Association (MJBA) and Online Marijuana Design (OMD Agency).  More than 1500 votes were cast in the MJBA/OMD Facebook Survey, which asked cannabis industry participants to vote for the best cannabis brand designs of 2016.

HONU’s Hawaiian-flavored design featuring a stylized sea turtle garnered the brand a total of 245 votes.  “Turtles have always been important to the local Hawaiian people as they provided spiritual influence, tools, food and clothing. But the Hawaiians never “took” from the turtles lightly, they always revered the turtles,” the company’s website proclaims. “We have chosen this as the name for our business as it embodies what we hold sacred as a team.”

honuteam

Results of the vote were announced at the recent “HOT BOX: The Best Marijuana Design and Packaging 2016” seminar in Tacoma. Team Honu was on hand to accept the award from MJBA founder/executive director David Rheins.  The Hot Box seminar took place June 2, 2016 in the historic Union Bank of California building in Tacoma, WA.

The event was produced by the Marijuana Business Association. Online Marijuana Design was the event’s presenting sponsor.  VIP Sponsors included Great Pacific Packaging, DCG One, PrintWest, Pearson Packaging, 420WholesalePack.com, Tryst Print Solutions, Foundry Law Group, Farmer Tom, NWMJLaw, Higher Ground TV, Curved Papers, Guts and Glory, Ganjapreneur, 420Media and Freedom Leaf.

Second place with 186 votes went to Renton, WA retailer Buddy’s. The jazz-themed pot shop was named after proprietor Myles Kahn’s grandfather, Buddy Kahn, a famous Salsa musician and band leader. The hip design of the company’s branding, with a strong retro music feel, was crafted by Guts and Glory creative director Michael Guttsen.

Buddys Poster

With its dramatic Italian glass jar, and a ‘fresh-picked locally’ design approach branding, Tier 1 producer Green Bluff Greenhouse took third place with 157 votes. Specializing in rare, old school Sativa’s, the small grower is quickly gaining a big reputation for quality. Green Bluff owner Rick Lynn Roening was on hand to accept the award.

Dramatic Italian glass jar Green Bluff Greenhouse

Dramatic Italian glass jar Green Bluff Greenhouse

Fourth place went to Tier 2 indoor producer SKöRD Marijuana, whose bold black and cream design and iconic umlauts proudly resonate with Scandinavian heritage.   The company produces flower, concentrates and infused edibles.

skord marijuana logo

Rounding out the Top 5 Best Cannabis Brand Design of 2016 is Curved Papers.  With an “Easy To Roll” theme and a eco-friendly minimalist package that emphasizes the brand value – a new shape for rolling papers that is a true innovation.

curvedpapers3

Company founder Michael O’Malley and his daughter Grace were on hand at the Hot Box seminar to accept their award.

Curved Papers' Michael and Grace O'Malley

Curved Papers’ Michael and Grace O’Malley

 

[youtube http://www.youtube.com/watch?v=I4uF4k6ZPMQ&w=560&h=315]

 

I-502 Accounting Basics: Avoid the Audit

By Anne Van Leynseele, NWMJ Law

WHO’S STANDING NOW; WHO’S STANDING TOMORROW

We keep getting the same questions over and over from different clients so to save everyone’s time; we decided to share the answers with all of you MJBA members.

GOALS OF THIS SERIES:

  1. To increase your business literacy.
  2. To help ensure that you fulfill all of the responsibilities of a small business owner.
  3. To clarify why outside professionals are essential to your survival and how to find and use the best fit for your business.

As a small business owner you are responsible for every part of the business. Understanding the stages of development can help clarify what is important at each stage of growth.

In small business offices around the country sits shoeboxes or file folders full of business receipts, invoices, and accounting data. As the months roll by and the data accumulates, your business is sitting on a growing problem. Learn before it is too late why your accounting system can cost your business and more.

For many start-ups and sole-proprietors, the shoebox or file box was a temporary fix prior to setting up an accounting system. But with procrastination the box can become the nemesis of your small business.

What is an Accounting System?

An accounting system for your business is not as simple as a shoebox or file folder. These items will collect and organize your important business information but you need to look at what the numbers are telling your business. An accounting system will take your business beyond record keeping and provide important financial indictors. An accounting system will have the following parts:

  • Data Collection: Includes business transactions and operations data.
  • Data Organization: A method of sorting data by date and transaction type.
  • Accounting Database: Data entry into a spreadsheet or accounting software program will form the basis of accounting information.
  • Financial Statements and Reports: Balance sheets, income statements, budgets, and timetables comparisons will aid in running your business.
  • Analysis: Regular review of main controls to avoid problems and capitalize on opportunities.

If your small business accounting system is focused only on collection and organization until year end than discover why you need to change over to a complete system.

8 Reasons for Accounting System Upgrade

  1. Expense Creep: It starts off innocently as you begin to add more regular expenses to your operations. Without monthly tracking of expenses and costs, you cash flow can quickly dry up.
  2. Overdue Accounts: Ignoring the need for an accounting system can make tracking accounts receivables a guessing game. Don’t be in the business of bank lending. Misplacing a 90-day overdue account is costing you money.
  3. Cash Flow Crunch: Every business will experience the highs and lows of cash cycles. To overcome periods of cash shortages or to get needed funding, an accounting system will help you identify who owes you money and places for expense cuts. Create a full financial summary every quarter.
  4. Lack of Data Security: How safe is your shoebox? Is it reinforced steel, fireproof and waterproof against major disasters? Important financial information needs to be stored on a removable disk and on a secured offsite location. Never take a chance assuming it can’t happen to you.
  5. Added Costs: Having an accountant or bookkeeper organize and compile your accounting data at year end can be costly. Organize your invoicing, accounts payable, accounts receivable and most important know your cash flow.
  6. Audit Risks: Surviving an IRS audit can be easier if all financial matters of your small business are in order. Providing an auditor with financial statements, organized files, and well tracked transactions will make everything easier for all parties involved.
  7. Bankruptcy is NOT an option in legal cannabis: With the majority of businesses failing in the first 5 years, poor financial management remains one of the top reasons for failure. It is your responsibility as a small business owner to maintain and regularly assess your financials. Not putting an accounting system in place early during your startup can mean the end of business. Proper accounting can help you see money losing strategies before it is too late.
  8. Financing Difficulty: Do not bring a shoebox of invoices and receipts to your banker or investor meeting. The professional appearance of your company’s books is part of a winning strategy to financing.

The price of business ownership comes with the responsibility of establishing an accounting system. On the plus side you feel more control over your business, less stress, and better profitability.

 

WHERE DO YOU STAND?

The accounting cycle for a small business begins with establishing the chart of accounts for that business and ends with closing the books for that business at the end of the accounting time period. The accounting cycle is a series of steps that the firm takes every accounting time period in order to take account of its financial transactions.

Here are the steps in the accounting cycle for a small business:

  1. Develop the Chart of Accounts for your Small Business
  2. Understand The Source Document in an Accounting Transaction
  3. Accounting Journal Entries
  4. Construct the General Ledger for your Small Business
  5. How to Prepare a Trial Balance
  6. How to Make Adjusting Entries in your Accounting Journals
  7. Prepare the Financial Statements
  8. Closing Entries as Part of the Accounting Cycle

Washington State Business Entities

You may operate your business under any one of several business structures in Washington State. Each type of structure has advantages and disadvantages that should be considered. The descriptions of the structures below are provided to assist applicants and are not intended to be legal definitions with the force of law. You should contact an attorney, accountant, financial advisor, banker, or other business or legal advisors to determine which form is most suitable for your business or organization.

  • A Sole Proprietorship is one individual or married couple in business alone. Sole proprietorship’s are the most common form of business structure. This type of business is simple to form and operate, and may enjoy greater flexibility of management and fewer legal controls. However, the business owner is personally liable for all debts incurred by the business.
  • A General Partnership is composed of two or more persons (usually not a married couple) who agree to contribute money, labor, and/or skill to a business. Each partner shares the profits, losses, and management of the business and each partner is personally and equally liable for debts of the partnership. Formal terms of the partnership are usually contained in a written partnership agreement.
  • A Limited Partnership* is composed of one or more general partners and one or more limited partners. The general partners manage the business and share fully in its profits and losses. Limited partners share in the profits of the business, but their losses are limited to the extent of their investment. Limited partners are usually not involved in the day-to-day operations of the business. Note: A limited partnership may opt to become a Limited Liability Limited Partnership* by including a statement to that effect in its certificate of limited partnership. Status as a limited liability limited partnership provides general partners with a shield from liability for obligations of the limited liability limited partnership.
  • A Limited Liability Partnership* is similar to a General Partnership except that normally a partner does not have personal liability for the negligence of another partner. This business structure is used most commonly by professionals such as accountants and lawyers.
  • The Limited Liability Company (LLC)* An LLC is formed by one or more individuals or entities through a special written agreement. The agreement details the organization of the LLC, including: provisions for management, assignability of interests, and distribution of profits or losses. Limited liability companies are permitted to engage in any lawful, for profit business or activity other than banking or insurance. Doing business as an LLC may yield tax or financial benefits.
  • A Corporation* is a legal entity, a corporation has certain rights, privileges, and liabilities beyond those of an individual. Doing business as a corporation may yield tax or financial benefits, but these can be offset by other considerations, such as decreased personal control. Corporations may be formed for profit or nonprofit purpose.
  • A Nonprofit Corporation* A nonprofit corporation is a legal entity and is typically run to further some sort of ideal or goal, rather than in the interests of profit. Many nonprofits serve the public interest, but some do engage in private sector activities. If your nonprofit organization is or plans to fundraise from the public, it may also be required to register with the Charities Program of the Washington Secretary of State.

Items marked with * must register with the Secretary of State, Division of Corporations and Charities.

See table below

LESSONS:

Set-up your company in a way that minimizes your tax liability

Make sure you understand your tax obligations

Keep a schedule of filing and payment deadlines

Do not fall behind

It is not too late to clean up the past

Money flows through a company and someone must keep track of it. A budget is a basic tool to understand the flow. A budget will inform your decisions by helping you decide how to allocate resources, control spending, and provide a way to plan for the next year.

Within an operating budget there are two major categories: fixed costs and variable costs. Each industry is going to have different forms or types of fixed costs.  In some industries, salaries are paid even if no work is accomplished. In 502 world, the insurance company has to be paid as a legal requirement for you to be in business. The sooner you offset the fixed costs within the accounting period, the sooner you will generate a profit, but to know what that number is you must have a budget. The rest I will leave to the experts on April 19th.

DRAFT OPERATING BUDGET

FIXED COSTS – Fixed costs are those cash expenses that must be paid whether the business produces or sells a single product. Some of these costs have a variable element, but you know the business will need to pay for the line item.
Building/location rent  
Equipment rent  
Advertising  
Website hosting/maintenance  
Insurance  
Software licenses  
Taxes  
License fees  
Utilities  
Dues and subscriptions  
CPA fees  
Legal fees  
Bank fees  
Security  
 
VARIABLE COSTS – A variable cost is a cost that changes in relation to variations in an activity. In a business, the “activity” is frequently production volume, with sales volume being another triggering event that increases variable costs.
Payroll  
Payroll taxes  
Benefits  
Contract labor  
Production supplies  
Packaging  
Commissions  
Delivery costs  
 

DRAFT CAPITAL EXPENDITURES BUDGET

Property purchase  
Computers/printer  
Tenant Improvements  
Buildout  
Farm equipment  
Equipment upgrades  
Emergency fund  
 

 

Managing Your I-502 Business Bootcamp is Feb 16th In Seattle

WASHINGTON: The Marijuana Business Association (MJBA) and Washington cannabis legal firm NWMJ Law have teamed up to present a series of business “bootcamps” tailored specifically to meet the needs of Washington’s licensed cannabis businesses.

The bi-monthly series kicks off February 16th, 6-8:30PM  at the Factory Luxe (Old Rainier Brewery) with the fundamentals of  “Managing Your 502 Business.”

Attorney Anne Van Leynseele will moderate the event. She has assembled a number of cannabis industry subject matter experts, including Norm Ives, Mosaic Insurance, CPA Dani Espinda, and business coach Debbie Whitlock , who will serve as VIP Panelists during this 2-hour interactive panel presentation.

There is a $10 cover charge for this event. Seating is limited, and RSVP’s are requested: