Industrial Hemp Takes America by STORM !

PROBLEM/OPPORTUNITY

The hemp industry essentially began again in the U.S. in December 2018 with the passage of the Federal Agriculture Act which legalized hemp production and distribution across the country. The industry currently faces many challenges regarding distribution infrastructure, market acceptance, and financial assistance. A wide-scale plan is needed to build up the potential of a hemp-based industry which we believe can transform the existing economic infrastructure throughout the United States & abroad.

The Plan incorporates a new federal program as well: Opportunity Zones. This dedicated OZ Hemp Fund ideally represents the spirit of this federal incentive as well as the Agriculture Act itself. This fund will generate economic revitalization in the heart of the U.S. as well Puerto Rico and other areas. It provides a multitude of jobs of all ranges while developing an entire new industry and marketplace.

SOLUTION/PRODUCT

The Plan provides infrastructure and a proof of concepts for a hemp economy. It also enables several companies to move beyond the initial start-up phase into viability. These companies already have markets & distribution. They simply need capital to produce goods, hire staffing & do adequate marketing. Several projects will be undertaken that provide needed infrastructure for the industry and services for the surrounding community. The $3B will acquire millions of SQ FT of building space, tens of thousands of acres of land, and capital to fully launch several companies. One of the primary companies, Planet Hemp Exchange, plans to go public in the next year, with an objective of a valuation in the hundreds of millions. This plan will produce thousands of immediate jobs with long-term employment and economic sustainability to distressed communities & the nation as a whole.

POTENTIAL RETURN/REVENUE MODEL

There are several different revenue streams. The Puerto Rican project alone, includes thousands of acres to grow industrial hemp. A partnership with the firm, Caribbean Hemp Ventures (CHV) is already in place. CHV has secured multiple LOI’s with municipalities to build soccer stadiums and other large projects such as a large ocean port. They will use the industrial hemp grown in these projects in hempcrete and other building materials. PR can support three harvests a year. Two harvests a year on 10,000 acres can generate nearly $18MM in profits after expenses, split 50% with Caribbean Hemp Ventures.

Other revenue sources include the hotel/business center. This building will have initial revenue from condominium sales, (est. $8.5 MM.) and then ongoing annual revenue from the hotel, merchant occupants and business suite rentals. ($2MM.) The warehouse buildings will receive income from leasing and general rental. Planet Hemp Exchange will be going public which will generate large amounts of capital and consequent dividends. Other companies in this Plan also expect large profitability.

The Opportunity Zone Hemp Fund has first mover status. This is a nationwide plan to mobilize the hemp industry. The first investors to move on this potentially can be involved in companies that can reach valuations like Canopy, etc. in the first stages of the cannabis industry.

FINANCIALS

 $3B. The funds can be staged out according to availability and need. The investment will be spread out between the Fall of 2019 to early 2022 and potentially beyond. These funds will also be used to trigger other incentives including:

·       Historical Tax Credits - Alternative Energy Tax Credits - New Market Tax Credits -        Low Income Housing Tax Credits - TIF agreements with the host cities & counties -      REAP Grants - Employment Credits - These incentives will add value to the overall fund beyond the Opportunity Zone benefits. The different tax credits, grants, etc, will raise the overall project well above the $3B level with the extra funds being allocated primarily to the building projects.

 By 2022 objectives for Opportunity Zone Hemp Fund ·       Puerto Rico projects well underway & near completion. ·        Buildings in plan completed & utilized. (Hotel, medical clinics, distribution centers, housing, etc.) ·       10,000 acres in Puerto Rico producing $12.5+MM in profits each year ·       Planet Hemp Exchange as a public company with a valuation exceeding $250MM. ·       Planet Hemp Foods, HepWax, Ecolution Clothing, Hemp Adobe, CareH2o fully launched and profitable as their own entities or as a division of Planet Hemp Exchange.    

THE TEAM/RELEVANT EXPERIENCE

Each entity and/or division already has its own team. Other professionals will be contracted as needed. The teams in Planet Hemp, Caribbean Hemp Ventures in Puerto Rico, Planet Hemp Foods, Dawson Racing, the restoration teams for the warehouses & apartment buildings, Hemp Adobe, HempWax, etc, are veteran professionals many of whom have been in their fields for decades. An Economic Revitalization Plan - Construction of 10 soccer stadiums/disaster shelters, a seaport, an auto racing track, equestrian center, other tourism infrastructure, thousands of acres of hemp fields and processing centers. An overall economic development project for Puerto Rico: $1.2B.         U.S. & International hemp industry infrastructure & JV funding: $1B.         The construction of 100 emergency medical clinics across the United States in distressed economic areas using industrial hemp construction materials: $300MM. The construction of a 21 Story building designed with industrial hemp products in the Midwestern community of Burlington, Iowa. The building will feature a hemp-oriented hotel, hemp museum, business suites, and upper floor condominiums & nearby tourism infrastructure including a Mississippi excursion riverboat & restoration of marina & historic railroad depot: $200MM. The purchase and renovation of the first River/RailRoad Hemp Distribution Center in the United States. The acquisition & renovation of buildings to provide housing, education, warehousing, & small manufacturing. sq. ft of building space and over 20 acres of land.: $250MM. The acquisition of building, equipment & distribution for large-scale food company promoting healthy, hemp-oriented & other organic foods targeted for schools, etc: $50MM.

Total cost of project: $3B.

How will this plan be financed?

Planet Hemp Exchange has a financing partner that provides access to a large scale global grant program. The objective is to cause economic development on a larger global scale. It’s actually a profit participation from certain top banks as a global funding mechanism that has been around for over 70 years but has limited access to unless you are liquid for over $150 million because they set that as a threshold to entry for two reasons: (1) limit access, and (2) because the structure was set to deal with the mega projects – typically when funding over $1 billion is needed.

A comparison, your local county may have a grant program for $100,000 for helping create economic development and the ripple effect that a project could have. This program is a profit share that RPF has access to from the largest financial mechanism with the largest banks. It is regulated by the IMF and World Bank and the European Central Bank is involved. RPF has access to it for whatever projects they agree to partner with as an 80/20 JV.  Because of their ability to put it together they have set their structure as being 20% of each project so that they can legitimately be the project partner to bring the funding in for the project, which will have no debt. The created Fund will ultimately own it (80%) and control it. It is important to own it outright with no debt burden. The project is therefore stronger and more sustainable for the long-term impact. The program exists for that reason. It improves lives by creating jobs, housing, cleaning up the environment or better use of our resources. That impact should have a long-term effect. It is the same structure for every project whether it’s a $25 million hotel project or a $2 billion master development. The return on investment is not just the bottom line. It is the long -term sustainable humanitarian impact. The bigger the project, the bigger the humanitarian impact should be and the more confident you can typically be on the long-term affect.

Some of the projects the funding partner currently is involved with:

- mass housing projects (market prices and affordable housing) - medical facilities - roads & bridges & transportation systems - marinas/ports - energy projects (recycling/waste to energy, solar, wind, oil & gas production and power plants) - manufacturing plants - hotels/resorts & theme parks - environmental cleanup 

How an Investor(s) is needed. No long-term investment is required. What is required is a placeholder fund:  $150MM, $30.4MM, $5.1MM

Large project funding program

·       100% funding, simple JV structure, no debt

·       Requires specific collateral, but if the project lead/applicant doesn’t have it, or can’t get it, the funding manager will help get it in place with arrangements we have established

·       Program is geared towards projects in the $500 million and up size but we regularly look at projects of $10M and up, no upper limit (our average project is currently around $3 billion and current largest project is over $200 billion)

·       Additional projects can be added to the funding request either at the start of funding or throughout the funding

·       Can do multiple projects together from same project developer/project owner/finance director, various ways to guide on the structure and then approve the funding for it

·       Typical projects are energy, manufacturing, housing, mixed-use developments, resorts & hotels.  

Projects will be submitted for review to the Fund Holding Company to see if it fits within the economic model. If the project and/or company falls within the parameters then a JV funding program will be offered.  

·       Both have a safety of principal - Background check on the investor is required to confirm the funds are clean - We can submit for final approval once we have an investor lined up and will be able to show the funding commitment letter as verification we are ready to proceed.

Breakdown of the Opportunity Zone Hemp Fund                                     

2019 is the first year that Opportunity Zones (OZ) are fully being used as part of an overall investment strategy. The Opportunity Zone Hemp Fund is a vehicle to stabilize and expand the hemp industry. The Opportunity Zone Hemp Fund, targets designated properties and companies in the U.S. and Puerto Rico that qualify as an investment under the Opportunity Zone status.

The Fund will place investment capital in chosen Opportunity Zone properties. In addition, it will invest funds in designated companies and businesses that are located in OZ areas. The OZ Hemp Fund will be the first of its kind in the hemp industry. It will be akin to an index fund involving eligible property and industry companies.

·       The initial Hemp Building Academy will be placed in an Opportunity Zones with an emphasis on future campuses being placed in these OZ’s as well.

·       An emphasis will also be placed upon building medical clinics in Opportunity Zones.

·       Distribution centers, warehouses, shipping facilities, etc, will also be placed in OZ areas.

·       Agricultural operations will also be eligible for the Opportunity Zone Hemp Fund.

·       96% of Puerto Rico is designated as an Opportunity Zone. The Fund will include all the different projects: the medical clinics, Educational centers, soccer stadiums, hemp operations, hotels, equestrian center, racing track, etc.

US Department of Commerce to invest $1.2 million in Puerto Rico's opportunity zone