Planet 13 Holdings has entered into an asset purchase agreement pursuant to which it has acquired cannabis inventory, equipment and tenant improvements, and subject to regulatory approval will acquire the Nevada cannabis licenses at a 45,000 square foot indoor cultivation and production facility in Las Vegas, Nevada from West Coast Development Nevada. Planet 13 is paying $1.156 million for the cannabis inventory, and $3 million for the operating assets, licenses, equipment and tenant improvements which payment is comprised of $0.5 million in cash and $2.5 million of common shares in the capital of Planet 13, resulting in the issuance by the Company of 1,374,833 Consideration Shares based on a 10-day VWAP, all of which shares are being held in escrow until the Second Closing (as defined below). The license transfer under the Asset Purchase Agreement is contingent on approval by the State of Nevada's Cannabis Control Board ("CCB"), and upon receiving such approval the Consideration Shares will be released from escrow to WCDN.
Concurrent with the signing of the Asset Purchase Agreement, Rx Land, an entity owned by Planet 13's Co-CEOs, separately acquired the Facility for $3.3 million. On the Second Closing, Planet 13 will enter into a lease agreement with RX Land for the Facility.
"We've been pursuing additional premium indoor cultivation to expand our Medizin flower line, including our proprietary strain Chloe. Medizin sells out each harvest days after it hits the SuperStore shelves. This agreement allows us to add 25,000 square feet of indoor cultivation immediately, with the ability to expand up to 45,000 square feet in the future," said Larry Scheffler, Co-CEO of Planet 13. "We look forward to expanding our supply and offering it in 3rd party dispensaries for the first time."
"In another example of Planet 13's patience and ability to execute for our shareholders, we've identified an opportunity to assume control of a fully built out indoor cultivation facility at a price that will be accretive," said Bob Groesbeck, Co-CEO of Planet 13. "Larry and I are paying $3.3 million of our own money to purchase the land and building, through RX Land, to preserve Planet 13's cash while offering an ongoing lease well below the rate set by cannabis REITS."
The Facility has 25,000 square feet under active cultivation with the ability to expand to 45,000 square feet. Effective immediately Planet 13 will assume management of the Facility allowing the Company to plant Medizin strains, including award-winning proprietary strain Chloe.
For more information:
Planet 13
2548 W. Desert Inn Rd. Suite 100 Las Vegas, NV 89109
702.815.1313
[email protected]
planet13lasvegas.com