CannaMed Q2 2014 Shareholder Report on Capital Raise, Important Events and New 506(c) Private Placement
LOS ANGELES, Aug. 4, 2014 /PRNewswire/ -- CannaMed Corp. (OTCBB: MDMJ) (the "Company"), a company that provides both funding and financing alternatives and turnkey support services for the lawfully organized cannabis industry, is pleased to provide shareholders with a summary of activities described in the Company's 2014 second quarter 10-Q filing in the form of a letter from Chief Executive Officer, Jordan Shapiro. This letter also covers important events that fall outside of the second quarter.
Dear CannaMed Shareholders,
It has been an exciting past six months of growth for CannaMed. We believe we are successfully progressing on our vision to develop a more professional ecosystem within the lawfully organized cannabis industry, creating a better work environment for our clients, improved patient experiences, and a clear choice for investors in the sector.
Capital Raise
We are pleased to announce that shortly after the end of our second quarter, the Company closed private placements that resulted in gross proceeds of $960,000. Restricted shares of our common stock were sold at $0.50 per share in this private offering, which in the aggregate resulted in the issuance of 1,920,000 shares. The majority of these funds were then used to complete open contracts with eligible legal cannabis clients which were previously negotiated. Borrowers used the invested funds for financing activities ranging from leasing or financing agricultural properties and indoor hydroponic facilities for clients' cultivation projects, to a working capital line of credit to an eligible client's legal cannabis collective.
We initially set out to raise $1,000,000 in financing to fulfill these commitments and exceeded our target goal last week with an additional $50,000 coming in to bring the aggregate total capital raised to over $1,000,000.
Financing and Services Contracts and Revenue Update
We have loaned funds to five separate entities for the acquisition of agricultural properties which have been leased to qualified legal growers in Northern California. In addition, we completed a loan to a California medical marijuana collective for working capital. Detailed descriptions of these transactions are available in our 10-Q filing with the Securities and Exchange Commission (SEC). Our service contracts initiate revenues to CannaMed this quarter.
Future Financings: New 506(c) Private Placement up to $10,000,000
We are now beginning a new private offering under Rule 506(c) of Regulation D whereby we intend to raise up to an additional $10,000,000. We intend to use the net proceeds from this offering to support our core business solutions and strengthen future revenue streams. More specifically, the proceeds will be deployed for working capital, real estate purchases, secured loans and financings, marketing and sales of our Cannabis Compliance Platform and credit card processing services, investor relations and communications, potential sponsorships in R&D opportunities, industry associations, as well as a reserve of contingency capital to address any new and potential opportunities.
We invite all accredited investors to contact us for a full copy of our Business Plan and Private Placement Memorandum. 1
Management's Discussion of Operations
CannaMed, through its wholly-owned subsidiaries 1849 Holdings, Inc. ("1849") and Cal-Westridge, LLC ("Cal-West"), provides financing and turnkey support solutions to lawfully operating participants in the legal cannabis industry.
Cal-West provides financing and capital to collectives, producers, property owners, and other legal cannabis industry participants. In an industry where traditional banking opportunities are limited, Cal-West provides lines of credit, property financing, and commercial loans.
1849 provides services and compliance solutions. Mr. Paul Shively, a Director of the Company and our Chief Financial Officer, leads these teams. Mr. Shively has worked with and developed relationships with over 500 dispensaries over the last 7 years providing exactly these types of services. Our team guides clients through the complex and ever-changing challenges in the legal landscape of California's legal medical cannabis industry. From best-practices beginning with business entity selection to establishing inventory tracking and patient records, we can help design and maintain industry-leading operations. Fees for our services and compliance solutions are currently negotiated on a case-by-case basis. We also offer turnkey build-out and commercial services to clients. More traditional business services are also offered, including human resources, payroll, workers compensation, donation accounting, tax planning, government audit preparation, and succession strategies.
Management and Directors
We are pleased to welcome Ms. Vinisha Agnihotri, who was recently appointed our VP Finance and Head of our Medical Research Committee. Paul Shively, our Chief Financial Officer, was also appointed Treasurer and to the Board of Directors on July 29, 2014. Additionally, we are accelerating our efforts to secure several additional key directors, officers, and advisors to join the CannaMed team.
2014 Future Plans
Over the next two fiscal quarters, the Company will work vigorously to identify, pursue and engage legal cannabis industry participants in California that may benefit from any of the Company's offered financial and turnkey services. Entering into service contracts with dispensaries, legal growing operations, land owners and others is our top priority.
We are very excited with the continual growth of the Company. We will continue to work tirelessly to build a successful business and to improve our service and product offerings. We are pleased by our accomplishments at CannaMed to date, and look forward to continuing to add value in the company for our shareholders.
Sincerely,
Jordan Shapiro
CEO
About CannaMed Corporation
CannaMed is a public company quoted on the OTCBB as MDMJ. CannaMed and our wholly-owned subsidiaries provide turnkey support solutions to the rapidly evolving and growing legal cannabis industry. We provide "seed to sale" turnkey business services including:
- Funding and Financing Solutions
- Compliance Consulting Solutions
- Collective, Dispensary and Retail Solutions
- Commercial Production and Equipment Build Out Solutions
- Banking and Payment Processing Solutions
- Multichannel Supply Chain Solutions
- Management, Branding, Marketing and Sales Solutions
- Research and Development Solutions
- Consumer Product Solutions
Our experienced management team has a combined thirty-two years of successful experience in the legal cannabis industry in California, and we are currently generating revenue from existing financing and service solutions. CannaMed is expanding throughout California and bringing its array of services to each new state that legalizes the use of cannabis. At this time, CannaMed does not grow, process, own, handle, transport, or sell marijuana. As the legal environment changes in California and elsewhere, management may explore business opportunities that involve ownership interests in dispensaries and growing operations. For more information, please visit www.CannaMedCorp.com.
1 Any securities sold in this offering may be sold only to accredited investors, which for natural persons are investors who meet certain minimum annual income or net worth thresholds. The securities are being offered in reliance on an exemption from the registration requirements of the Securities Act and are not required to comply with specific disclosure requirements that apply to registration under the Securities Act. The SEC has not passed upon the merits of or given its approval to the securities made available in this announced offering, the terms of the private offering, or the accuracy or completeness of any offering materials. The securities are subject to legal restrictions on transfer and resale and investors should not assume they will be able to resell their securities. Finally, investing in the Company's securities involves risk, and investors should be able to bear the loss of their investment.
Safe Harbor Statement
This release contains "forward-looking statements" that include information related to future events and future financial and operating performance. The words "may," "would," "will," "expect," "estimate," "can," "believe," "potential" and similar expressions and variations thereof are intended to identify forward-looking statements. Forward-looking statements should not be read as a guarantee of future performance or results, and will not necessarily be accurate indications of the times at, or by, which that performance or those results will be achieved. Forward-looking statements are based on information available at the time they are made and/or management's good faith belief as of that time with respect to future events, and are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in or suggested by the forward-looking statements. Important factors that could cause these differences include, but are not limited to: the ability of CannaMed to secure appropriate funding to implement its business plan, the demand for CannaMed's services, CannaMed's ability to maintain customer and strategic business relationships, the regulation of legal cannabis on both state and federal levels, the impact of competitive products and pricing, growth in targeted markets, and other information that may be detailed from time-to- time in CannaMed's filings with the United States Securities and Exchange Commission. CannaMed undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
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SOURCE CannaMed Corporation
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