The Hemp Farming Act of 2018 was a proposed law to remove hemp (defined as cannabis with less than 0.3% THC) from Schedule I controlled substances and making it an ordinary agricultural commodity. Its provisions were incorporated in the 2018 United States farm bill that became law on December 20, 2018.
Industry stakeholders anticipate increased investment into the industry, as well as massive growth in hemp research, cultivation and sales.
The $867 billion agriculture law cleared the Senate Dec. 11 with a 87-13 vote before gaining approval in the House Dec. 12 with a 369-47 vote. The bill has been sent to President Trump, who is expected to sign it into law.
The Farm Bill removes hemp from the Controlled Substances Act and allows farmers to pursue federal hemp cultivation permits, while individual states can regulate the industry within their borders as they see fit. Already, 40 states have established hemp cultivation “pilot programs” for industrial and commercial purposes, although the plant has been strictly regulated.
Prometheus Botany Medicinal expects to raise up to $1 million in Class A Preferred Membership Units (which it believes to be the LLC equivalent to preferred stock in a corporation). These investment units are expected to pay a 6%-12% annual dividend to investors and investors receive an additional “equity kicker,” equal to 1.5% of any ultimate sales proceeds if the company is sold in a planned disposition in five to seven years. Additional detail is explained under Exit Strategy below.
This investment is your opportunity to become a member/owner of Prometheus Botany Medicinal operated and controlled by MKG Financial Group Private Equity Fund Adv. while receiving annual dividend payments and exclusive investor benefits, as described in the Investor Benefits section below.
Cannabis Opportunistic Investments LXIV Fund include investments in Licensed Cannabis tracked-and-trace Businesses (the debt instruments of companies which may be publicly traded or privately held that are Cannabis Dispensary, Cannabis Cultivation, Cannabis Manufacturing, Cannabis Distribution, Cannabis Testing Laboratory, Facility, or Entity) and or Land Development, mezzanine, secondaries, and other private investment strategies that are opportunistic in nature and do not follow a buyout or venture capital/growth equity strategy.
Typical holdings are senior and subordinated debt instruments and corporate bonds. Equity exposure is acceptable as debt positions are often converted to equity during the cultivation process. Investments are typically made in years one through five and returns typically occur in years three through ten. Investments may be made in companies that are either U.S. or non-U.S. domiciled.
An investor will receive shares of common stocks. Share prices are currently $0.16 each and require a minimum investment of $500 to $2,000
Investment returns will fluctuate and are subject to market volatility, so that an investor’s shares, when redeemed or sold, may be worth more or less than their original cost. Unlike mutual funds, shares of Prometheus Botany Medicinal operated by series LLC MKG Financial Group Private Equity Fund Advisors Private Placements are not individually redeemable directly with the exchange market NASDAQ, S&P 500, Down Jones, OTC Markets
Shares are bought and sold at par value, which may be higher or lower than the net asset value (NAV).
Equity Crowd Funding Offering Memorandum: Not FDIC Insured • No Bank Guarantee • May Lose Value
- Cannabis Dispensary Investor Fund – Investment into a facility where cannabis or cannabis products, are offered, either individually or in combination, for retail sale, including an establishment that engages in the delivery of cannabis or cannabis products as part of a retail sale.
- Cannabis Cultivation Investor Fund– Investment into any activity involving the planting, growing, harvesting, drying, curing, grading, or trimming of cannabis. “Cultivation” also includes nurseries.
- Cannabis Manufacturing Investor Fund – Investment into a LLC or Corporation who conducts the production, preparation, propagation, or compounding of cannabis or cannabis products either directly or indirectly or by extraction methods, or independently by means of chemical synthesis, or by a combination of extraction and chemical synthesis, or that packages or repackages cannabis or cannabis products or labels or re-labels its container.
- Cannabis Distribution Investor Fund– Investment into a LLC or Corporation engaged in procuring cannabis from a cultivator, and/or procuring cannabis products from a manufacturer, for sale to a licensed commercial cannabis business.
Cannabis Testing Investor Fund– Investment into a laboratory, facility, or entity in the State, that offers or performs tests of cannabis or cannabis products and that is both of the following: 1) Accredited by an accrediting body that is independent from all other persons
Preferred Investor Financial Benefits
Distribution Rights*: Holders of Class A Preferred Membership Units are entitled to a six percent (6%) annual rate of return (calculated using your original investment amount) paid from net cash flow from operations every year. These cash distributions will be paid at the end of the period for the previous twelve (12) months (i.e. paid in arrears).
Additionally, these cash distributions will have preference (i.e. paid before other investor classes) to the holders of all other class of Membership Interest of the Company.
Example: $10,000 original investment. Rate of return due at the end of the 12 month period = $10,000 * .06 = $600.
Right to Receive Liquidation Distributions*: Holders of Class A Preferred Membership Units, in preference (i.e. paid before other investor classes) to the holders of all other classes of Membership Interest of the Company, shall be entitled to a preferred distribution upon a liquidation of the Company equal to their initial investment plus any unpaid preferred distributions.
Additionally, Class A investors will receive an “equity kicker” equal to 1.5% of any ultimate sales proceeds of $5 million or more, if the company is sold in a planned disposition in five to seven years.
The net proceeds shall be determined by deducting the costs, including but not limited to sales commissions related to the liquidation as reasonably determined by the managers, as well as any outstanding debt remaining at the close of the liquidation transaction.
*Note: See MKG Financial Group Private Equity Fund Advisors LLC Offering Statement for complete details.
City of Fresno | Draft Cannabis Regulations released by Council Sub-Committee
10 Cannabis license HUBS is expected to be issued November 2019