CannaRoyalty (CSE:CRZ) has announced that it has entered into a binding term sheet regarding a royalty financing agreement with Natural Ventures.
As quoted in the press release:
Located in San Juan, Natural Ventures is one of Puerto Rico’s first and largest licensed cultivation and manufacturing medical cannabis companies, featuring a 100,000 square foot indoor cultivation facility. Natural Ventures is also one of two companies in Puerto Rico that has received a manufacturer’s license for its 30,000 square foot manufacturing facility.
Pursuant to the term sheet, Natural Ventures has agreed to grant CannaRoyalty a 2.5% royalty on Natural Ventures’ net profits, and a further 10% referral royalty on revenue generated from products licensed by Natural Ventures from CannaRoyalty for the Puerto Rican Market over a 10-year term, each starting from the date Natural Ventures commences commercial sales (collectively, the “Royalty”).
“Through this royalty financing arrangement, we will be able to offer CannaRoyalty investors a foothold in the newly opened, sizeable marketplace in Puerto Rico,” said Marc Lustig, Chief Executive Officer, CannaRoyalty. “We welcome this opportunity to work with the team at Natural Ventures and are pleased to be able to offer CannaRoyalty’s portfolio of brands and products.”
Natural Ventures’ Chief Executive Officer, Edgar Montero stated, “We are very excited to have CannaRoyalty as our investment partner at a time of exceptional growth in Puerto Rico’s medical cannabis industry. Having access to CannaRoyalty’s diverse portfolio of brands and products puts us in an excellent position with our first harvest expected in January 2017, and sales of products to patients expected to commence in Q1 of 2017.”