ESCONDIDO, Calif., May 14, 2019 (GLOBE NEWSWIRE) -- via NetworkWire -- PRESS RELEASE -- Marijuana Company of America, Inc., a hemp and cannabis corporation, has announced that the company has signed a Letter of Intent with Essence Farms, LLC to form a joint venture called Riverside Hemp Project to run farming operations in California for the purpose of growing, cultivating, manufacturing, extracting and selling legal hemp and hemp-derived CBD.
Through the agreement, Marijuana Company of America will provide hemp seeds, genetics, management of operations and standard operating procedures. Essence, a cultivator and land owner, will provide all necessary licenses for the legally compliant growth and sale of hemp in Riverside, Calif..
“MCOA strives to be a leader in producing and distributing hemp, and we believe this joint venture will allow the company to further its vision by establishing itself as a premier company in the hemp sector,” said Don Steinberg, chief executive officer of Marijuana Company of America. “With the ongoing return of net profits this project is expected to provide MCOA, we are confident that signing this Letter of Intent is another strategic step for the company and we look forward to expanding further in both the cannabis and hemp markets in California. If all goes according to plan, this will by far be the most financially successful venture the company has been involved in.”
Marijuana Company of America will receive an 80-percent return of net profits for the JV on an ongoing basis, as well as a long-term lease on the property with favorable lease terms. The project includes up to 500 usable acres of land in California’s Riverside County that has sufficient water and power and is specifically suited for large-scale cultivation. The company is in the process of sourcing the highest quality seeds that will yield a high percentage of CBD with legally compliant low levels of THC. It is projected that each acre will produce 2,500 pounds of hemp biomass. Based on prevailing fair market rates at this time, the biomass can be sold for approximately $35 a pound. If the company processes the biomass as it intends to do, at least in part, the biomass will produce a significantly higher financial return. Additionally, the property is equipped with several large structures that are suitable for the storage and drying of the hemp plants. A highly experienced cultivation team has been engaged to manage the operations and cultivation of the farm.
Consummation of the transaction remains contingent upon satisfactory completion of due diligence by both parties and completion and agreement on all final terms and conditions of the engagement. Further details on the terms of this LOI are available in the Company’s filing, which can be accessed at www.sec.gov.