GrowBLOX Sciences has entered into a Note Purchase Agreement
with Pacific Leaf Ventures, LP in which Pacific Leaf has agreed to make an
installment loan to GrowBLOX of up to $1.75 million. According to an SEC
filing, the financing provides the funding for GrowBLOX subsidiary GB Sciences
Nevada, LLC to acquire and install an operating facility, equipment, and other
tangible assets for the cultivation of cannabis and the extraction of oils and
other constituents present in cannabis, in adherence to Nevada legal
requirements.
GBS Nevada holds a provisional certificate from the Division
of Public & Behavioral Health of the Nevada Department of Health and Human
Services to operate an establishment to cultivate medical cannabis in Clark
County Nevada. The certificate is considered provisional until the
establishment is in compliance with applicable local government requirements
and has received a state business operating license.
In a related development, GrowBLOX also entered into an
exclusive perpetual license agreement to make use of Pacific Leaf’s
intellectual property (IP) for the cultivation of cannabis and extraction of
oils and other strains of cannabis that it has developed or acquired for the
sole use of GBS Nevada in its operations within the state of Nevada. In
consideration for the license, GrowBLOX has agreed to pay Pacific Leaf a 14
percent royalty for a period of five years, and a 7 percent royalty each year
for five years thereafter.
As part of the Pacific Leaf license, GrowBLOX was also
granted the exclusive perpetual right in Nevada to use certain proprietary
techniques developed by Pacific Leaf for the extraction of oils from the
product grown in the Nevada facility, using the extraction equipment financed
by the proceeds of the Pacific Leaf loan. In connection therewith, GrowBLOX
agreed to pay a royalty of $2 per extracted gram for a period of five years.
GrowBLOX said it believes that the rights to Pacific Leaf’s
IP will give GBS Nevada a “significant competitive advantage in the Nevada
cannabis market.” This advantage is complementary to GrowBLOX’s broader
business strategy to integrate state-of-the-art technologies in plant biology,
cultivation, and post-production processes to optimize safe, consistent medical
cannabis.
For more information, visit www.gbsciences.com
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