12955 Bottle Rock Rd
Kelseyville, CA 95451
For Lease

To receive the completed proposal, pitch deck, and financial documentation, please get in contact: I. Overview Bottle Rock Herbal Medicine, LLC (BRHM) is seeking a partner for the development of a 22,000 square feet commercial indoor-greenhouse to cultivate premium cannabis for the wholesale market. Located at 12955 Bottle Rock Road, Kelseyville California 95451, the pristine property contains 22 acres of meadows, hills, creeks, and ponds. The property consists of a residence, pond, access to Carter Creek, and several small wells. The property has one-acre parcel allowed for cannabis cultivation, which grants up to a total of 22,000 ft2 of indoor cultivation space. Having grown medicinal cannabis on a neighboring property in 2011 and 2012 respectively, it’s proven the landscape to be an ideal cannabis cultivation environment. The terms of the lease on the property are inline with the county’s local authorization timeline, thus the lease will be for a 10-year term, with a renewable option for an addition 10-years upon reissuance of the local authorization. For the project, BRHM forecasts an annual recurring gross revenue of $5,135,000.00, with an annual gross profit of $3,406,610.32. As the landscape and weather conditions in Lake County is optimal for the cultivation of a number of fickle crops, cannabis’ profitability far outweighs other locally popular crops. For example, in 2019, cabernet grapes averaged annual gross revenue of $23,192.00 per acre. The per-acre annual gross revenue for one acre of cannabis that same year was $4,156,164.00. BRHM is a proud member of the Lake County Cannabis Alliance. The Alliance includes cultivators, distributors, and manufacturers as members of the alliance. BRHM has developed relationships with several members interested in purchasing product from BRHM upon product availability. II. Product Description Bottle Rock Herbal Medicine, LLC, is geared to produce premium organic, highly potent AAA cannabis: flower, trim, and “smalls” for the state-licensed wholesale cannabis marketplace. III. Business Model There’s much more price transparency in the cannabis market today than at any time in the past. Currently, indoor-grown cannabis sells between $1,750.00 - $2,100.00 per-pound, but BRHM uses $1,400.00 per pound for forecasting. Priced at a point that will allow for a quick turn-around of product, BRHM elected to be competitive by undercutting the wholesale market. Naturally, cannabis prices vary by season, as well as in response to supply and demand. The benefit of greenhouse cannabis is the extended harvest cycle and the ability to produce product when outdoor growers can’t. Having an “off cycle” harvest means BRHM will have cannabis flower during the “droughts” in the industry; and when prices are the highest. Greenhouse cannabis cultivation also allows the ability to manipulate and control the environment; eliminating a plethora of issues that outdoor cultivators experience. As an example of manipulating the environment, BRHM intends to introduce CO2 into the greenhouse, which in turn increases the THC level of the plants. Higher THC products translate into a higher demand for the product and a higher price point. IV. Market Analysis There is a large market for cannabis flower and cannabis trim within the state of California. In fact, by 2022, Marketnewsupdates.com projects the global cannabis market to be worth as much as $32 billion, a three-fold increase in just five years. United States production is anticipated to fuel much of that growth, with an expected market value of $23.3 billion. The largest group of cannabis buyers is predicted to be in North America: Forbes projects it is increasing from $9.2 billion in 2017 to $47.3 billion a decade later. V. Major Use Permit Lake County cannabis major use permits are valid for 10 years. At a time when this industry remains small, but growing, investment in its evolving and expansive future offers a unique opportunity for our investors. Lake County commercial cannabis cultivation regulations (ordinance No. 3084. 05/21/2019) allow property owners the ability to grow one acre outside or 22,000 square feet inside of cannabis for every 20 acres. Lake County also requires a home on each site where the cannabis is grown. BRHM will be concluding the major use permitting process to grow cannabis on the property within six months of investor commitment. As the applicant for the Lake County permit, BRHM is in the process of completing the county requirements for the property. Currently completed for the project are the archaeological review, soil tests, and site plan. Additional components required that are pending, include the biological review and pre-application. VI. Timeline For information regarding BRHM’s timeline, please refer to the BRHM Deck 1-Parcel attached as Exhibit A (pg. 11 & 12). VII. Company Structure BRHM will be taxed as a pass-through California Limited Liability Company (on a Partnership basis). This structure allows the partners of BRHM to receive the entirety of the business’ income, take deductions based upon their equity ownership, and pay taxes on a per-partner individual basis. VIII. Investment Based on the financial projections the calculated internal rate of return (IRR) for this project is 68%. The total investment in BRHM amounts to $3.22M for a 50% equity stake. The invested capital comes with favorable repayment terms for the investors. The investment will come in two parts as follows: 1. The initial investment will be $1,668,929.87 allocated for all start-up costs (investment received by June, 2020). 2. The allocation of $1,549,094.40 will be invested for operation during the first year (estimated at the end of December 2020). The second allocation of the invested capital will be held in an escrow account and will be distributed upon completion of the deliverables from the initial investment. For the forecasted profit and loss, please refer to Exhibit B. An itemized and detailed use of funds (summary in Exhibit A – pg. 22) is also available upon request, but will require the signing of BRHM’s Non-Disclosure Agreement (NDA). IX. Disclaimer & Notice of Risks While Bottle Rock Herb Medicine, LLC and Joleen Wignall et.al strives to make the information in this proposal as accurate as possible, the parties make no claims, promises, or guarantees about the accuracy, completeness, or adequacy of the contents of this material and expressly disclaims liability for errors and omissions in the contents of this proposal. The partner should understand that there are certain risks that are assumed in investments in operations such as these. Among them: considerations of security, insects and power outages, the banking industry is still working out how to deal with how to handle accounts for businesses legal in their own states, but not yet recognized by the federal government. 2020 is the first-year start-up for Bottle Rock Herbal Medicine, LLC.