8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of report (Date of earliest event reported): September 18, 2020

POWER REIT

(Exact name of registrant as specified in its charter)

Maryland

(State or other jurisdiction of incorporation)

001-36312

(Commission File Number)

45-3116572

(IRS Employer Identification No.)

301 Winding Road

Old Bethpage, NY 11804

(Address of principal executive offices and Zip Code)

Registrant’s telephone number, including area code: (212) 750-0371

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

[  ]	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
[  ]	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
[  ]	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
[  ]	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class	Trading Symbol	Name of Each Exchange on Which Registered
Common Shares	PW	NYSE (American)
7.75% Series A Cumulative Redeemable Perpetual Preferred Stock, Liquidation Preference $25 per Share	PW.A	NYSE (American)

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company [  ]

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. [  ]

Item 1.01. Entry into a Material Definitive Agreement.

On September 17, 2020, Power REIT (“Power REIT” or the “Trust”), through a wholly owned subsidiary of the Trust (“PropCo”), in connection with the acquisition of a 3.0 acre property located in York County, Maine (the “505 Property”), entered into a triple-net lease (the “Lease”) with Sweet Dirt (the “Tenant”). The Lease provides that Tenant is responsible for paying all expenses related to the Property, including maintenance expenses, insurance and taxes. The Lease requires the Tenant to maintain a medical cannabis license and operate in accordance with all Maine regulations with respect to its operations.

As part of the agreement, the Trust agreed to fund the construction of an approximately 9,900 square feet of processing building and the renovation of an existing 2,738 square foot building on the Property for $1.56 million.

The Lease is structured whereby after a nine month period, the additional rental payments provide PropCo with a full return of its original invested capital over the next three years and thereafter, provide a 13.2% return increasing 3% rate per annum.

In addition, on August 25, 2020, Power REIT has entered into an agreement for expansion of a property located in Southern Colorado (“Sherman 6”) owned by a wholly owned subsidiary of the Trust (“Sherman 6 PropCo”) and leased to Green Street LLC (“Tenant”) pursuant to a lease (the “Lease”).

The expansion consists of approximately 2,520 square feet of additional greenhouse/headhouse space. The Tenant is responsible for implementing the expansion and Sherman 6 PropCo will fund the cost of such expansion up to a total of $151,301, with any additional amounts funded by Tenant. Once completed, Power REIT’s total investment in Sherman 6 will be $1,995,101.

As part of the agreement, Sherman 6 PropCo and Tenant have amended the Lease whereby after a nine month period, the additional rental payments provide Sherman 6 PropCo with a full return of its original invested capital over the next three years and thereafter, provide a 12.9% return increasing 3% rate per annum.

The foregoing descriptions of the leases do not purport to be complete and are qualified in its entirety by reference to the complete text of the Leases, copies of which are attached hereto as Exhibit 10.1 and 10.2 and are incorporated into this Current Report on Form 8-K by reference.

Item 2.01 Completion of Acquisition or Disposition of Assets.

On September 18, 2020, the Trust, through PropCo, completed the acquisition of the 505 Property which is a 3.0 acre Property in York, Maine for $400,000. The Property is adjacent to a property (the “495 Property) acquired by PropCo on May 15, 2020 that is leased to the Tenant. PropCo exercised its option it received at the time of the acquisition of the 495 Property to purchase the 505 Property. Power REIT’s total investment in the 505 Property at the completion of funding will be approximately $1.96 million.

Item 7.01 Regulation FD Disclosure.

On September 18, 2020, the Trust issued a press release regarding the acquisition and expansion of the properties. A copy of the press release is attached hereto as Exhibit 99.1. The information contained in Item 7.01 of this report, including Exhibit 99.1, is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section. Such information shall not be incorporated by reference into any filing of the Trust, whether made before or after the date hereof, regardless of any general incorporation language in such filing.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits.

Exhibit	Description of Exhibit
10.1	Lease Amendment related to Sweet Dirt
10.2	Lease Amendment related to Sherman 6
99.1	Power REIT Press Release issued on September 18, 2020

Forward-Looking Statements

Some of the information in this press release contains forward-looking statements and within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. When used in this press release, words such as “believe,” “expect,” “anticipate,” “estimate,” “plan,” “continue,” “intend,” “should,” “may,” “target,” or similar expressions, are intended to identify such forward-looking statements. Forward-looking statements are subject to significant risks and uncertainties. Investors are cautioned against placing undue reliance on such statements. Actual results may differ materially from those set forth in the forward-looking statements. Factors that could cause actual results to differ materially from those described in the forward-looking statements include those discussed under the caption “Risk Factors” included in our Annual Report on Form 10-K for our fiscal year ended December 31, 2018, which was filed with the U.S. Securities and Exchange Commission (“SEC”), as well as in other reports that we file with the SEC.

Forward-looking statements are based on beliefs, assumptions and expectations as of the date of this press release. We disclaim any obligation to publicly release the results of any revisions to these forward-looking statements reflecting new estimates, events or circumstances after the date of this press release.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	POWER REIT
Date: September 18, 2020	By	/s/ David H. Lesser
		David H. Lesser
		Chairman of the Board and Chief Executive Officer

EX-10.1

Exhibit 10.1

FIRST AMENDMENT TO LEASE AGREEMENT

THIS FIRST AMENDMENT TO LEASE AGREEMENT (this “Amendment”) is made and entered into as of the ___ day of September, 2020 by and between PW ME CanRe SD LLC, a Maine limited liability company (“Landlord”), and NorthEast Kind Assets, LLC, a Maine limited liability company (“Tenant”).

RECITALS:

A. Landlord and Tenant are parties to the Lease Agreement dated May 15, 2020 (the “Original Lease”), pursuant to which Tenant leases from Landlord the land and all improvements thereon located at 495 Harold L Dow Hwy., Eliot , Maine as more particularly described in the Original Lease (the “Premises”).

B. Landlord and Tenant desire to amend the Lease to add an additional parcel located at 505 Harold L Dow Hwy., Eliot , Maine (the “Additional Parcel”) to the Property and the Premises and to make corresponding changes to the Lease. The Additional Parcel is described on Exhibit 1- First Amendment, attached hereto.

AGREEMENT:

THEREFORE, in consideration of the mutual covenants set forth herein, the Lease is hereby amended on the terms and conditions hereinafter set forth.

1. Initially capitalized terms not otherwise defined herein will have the meanings given to such terms in the Original Lease.

2. Effective as of the date of this Amendment, the Property and Premises shall be expanded to include the Additional Parcel together with all rights appurtenant thereto and with all improvements located or to be constructed thereon in accordance with the terms of the Original Lease as amended hereby. The expanded Premises are deemed to consist of approximately 3.58 +/- acres.

3. The definition of “Base Rent” in the Lease is amended to include the column entitled “Monthly Rent” on the Rent Schedule attached as Exhibit 3 – First Amendment, which will be in addition to the Monthly Rent on the Rent Schedule attached to the Original Lease as Exhibit 3. In the event of the federal legalization of the recreations use of cannabis in the United State, the Base Rent attributable to the Additional Parcel will be the amount listed in the column entitled “Rent if Reset’ in the Rent Scheduled attached as Exhibit 3 – First Amendment.

4. Tenant is obligated to construct an approximately 9,900 square foot building on the Additional Parcel, and make certain related improvements to the Additional Parcel (the “Additional Parcel Construction”) on or before July 31, 2021. The “Manufacturing Building Scope and space planning requirements” attached as Exhibit 2 – First Amendment represent the initial specifictions for the Additional Parcel Construction, but such plans are subject to further revision and adjustment by Tenant from time to time. Landlord will fund the cost of the Additional Parcel Construction up to the amount of the Construction Budget made part of Exhibit 2 – First Amendment. Tenant shall be responsible for all costs beyond the Construction Budget. Tenant shall be required to obtain all permits and approvals for the Additional Parcel Construction. Landlord funding with respect to the Additional Parcel Construction shall be made in accordance with the process set forth in Section 4.3 of the Original Lease. All contractors must submit insurance certificates acceptable to Landlord and naming Landlord prior to commencement of work.

1

5. Effective as of the date of this Amendment, Section 11.1 of the Original Lease is amended to require that the Security Deposit shall be $422,000 and Tenant shall deposit and additional $122,000 to fund the increased Security Deposit.

6. This Amendment sets forth the entire understanding and agreement of the parties hereto in relation to the subject matter hereof.

7. Except as specifically amended, modified or supplemented herein, the Original Lease, as amended hereby, is hereby confirmed and ratified in all respects and will remain in full force and effect according to its terms. In the event of any conflict or inconsistency between the provisions of the Original Lease and this Amendment, the provisions of this Amendment will control in all instances.

8. This Amendment may be executed in several counterparts, each of which will be deemed an original, and all of such counterparts together will constitute one and the same instrument. Executed copies hereof may be delivered by telecopy or electronic delivery, and upon receipt, will be deemed originals and binding upon the parties hereto.

9. Each party represents and warrants that, as of the date of this Amendment it has the unconditional and unrestricted right, power and authority to enter into this Amendment.

IN WITNESS WHEREOF, the parties have caused this Amendment to be executed as of the date first written above.

[SIGNATURE PAGE TO FOLLOW]

2

TENANT:

NorthEast Kind Assets, LLC,

a Maine limited liability company

By:

Name:

Title:

LANDLORD:
PW ME CanRe SD LLC,
a Maine limited liability company
By:
Name:	David H. Lesser
Title:	Authorized Signatory

3

JOINDER OF GUARANTORS

The Guarantors of the Original Lease join herein for the purposes of evidencing their consent to this Amendment, and agreement to be bound all obligations of the Tenant Parties under the Original Lease as amended by this Amendment. The obligations of the Tenant Parties herein shall be joint and several.

NORTHEAST KIND HOLDINGS LLC, a Maine limited liability company

By:

Name:

Title:

SWEET DIRT LLC, a Maine limited liability company

By:

Name:

Title:

JUDLEY, LLC, a Maine limited liability company

By:

Name:

Title:

SAGEMED, LLC, a Maine limited liability company

By:

Name:

Title:

SD3, LLC, a Maine limited liability company

By:

Name:

Title:

Hughes Pope

Kristin Pope

4

Exhibit 1 – First Amendment

A certain lot or parcel of land, together with the buildings thereon, situated in said Eliot, bounded and described as follows:

Beginning at the northern corner of land now or formerly of Nathaniel Hanscom;

Thence running North sixty-eight and three quarters (68 ¾) degrees East, sixty-two (62) rods and then ten (10) links, more or less, to land of the Boston and Maine Railroad upon which runs the railroad track;

Thence turning and running in a Southerly direction by said land of the Boston and Maine fifteen (15) rods and ten (10) links, more or less, to land of John Rogers;

Thence turning and running in a Southwesterly direction by land of John Rogers, aforesaid, to land now or formerly of Nathaniel Hanscom;

Thence turning and running North thirty-three (33) degrees West, fourteen (14) rods and five (5) links by said land of Nathaniel Hanscom to the point of beginning.

5

Exhibit 2 – First Amendment

Power REIT Funded Construction Costs:
Partial Demo Existing Building and rehab of remainder	$	30,000.00
Sitework (clearing, stumping, material import, grading, etc.)	$	125,000.00
10,000SF metal building	$	360,000.00
(incl. foundation, slab, shell, roof, insulation)
Interior framing/drywal	$	92,500.00
Interior doors, frames, hardware	$	40,425.00
Painting	$	37,200.00
ACT ceilings	$	38,750.00
VCT flooring, vinyl base	$	48,500.00
Millwork allowance	$	23,000.00
Toilet partitions & accessories	$	17,300.00
Plumbing underground and fixture install	$	92,300.00
Electrical power, site and exterior lighting, fire & life safety	$	155,000.00
HVAC	$	105,000.00
Hydronic Heating	$	115,000.00
Security/Access Controls/Cameras	$	40,000.00
Design Fees	$	62,500.00
Septic System	$	40,000.00
Contingency/Development Fee	$	142,247.50
Total Power REIT Funded Construction Costs:	$	1,564,722.50

6

7

Exhibit 3 – First Amendment

Month	Date	Monthly Rent	Monthly Rent if Reset
1	1-Oct-20	-	NA
2	1-Nov-20	-	NA
3	1-Dec-20	-	NA
4	1-Jan-21	-	NA
5	1-Feb-21	-	NA
6	1-Mar-21	-	NA
7	1-Apr-21	-	NA
8	1-May-21	-	NA
9	1-Jun-21	-	NA
10	1-Jul-21	27,982.26	NA
11	1-Aug-21	27,982.26	NA
12	1-Sep-21	27,982.26	NA
13	1-Oct-21	27,982.26	NA
14	1-Nov-21	27,982.26	NA
15	1-Dec-21	27,982.26	NA
16	1-Jan-22	55,964.51	NA
17	1-Feb-22	55,964.51	NA
18	1-Mar-22	55,964.51	NA
19	1-Apr-22	55,964.51	NA
20	1-May-22	55,964.51	NA
21	1-Jun-22	55,964.51	NA

8

22	1-Jul-22	55,964.51	NA
23	1-Aug-22	55,964.51	NA
24	1-Sep-22	55,964.51	NA
25	1-Oct-22	55,964.51	NA
26	1-Nov-22	55,964.51	NA
27	1-Dec-22	55,964.51	NA
28	1-Jan-23	55,964.51	NA
29	1-Feb-23	55,964.51	NA
30	1-Mar-23	55,964.51	NA
31	1-Apr-23	55,964.51	NA
32	1-May-23	55,964.51	NA
33	1-Jun-23	55,964.51	NA
34	1-Jul-23	55,964.51	NA
35	1-Aug-23	55,964.51	NA
36	1-Sep-23	55,964.51	NA
37	1-Oct-23	55,964.51	NA
38	1-Nov-23	55,964.51	NA
39	1-Dec-23	55,964.51	NA
40	1-Jan-24	83,946.77	NA
41	1-Feb-24	83,946.77	NA
42	1-Mar-24	83,946.77	NA
43	1-Apr-24	83,946.77	NA
44	1-May-24	83,946.77	NA

9

45	1-Jun-24	83,946.77	NA
46	1-Jul-24	22,145.16	NA
47	1-Aug-24	22,145.16	NA
48	1-Sep-24	22,145.16	NA
49	1-Oct-24	22,145.16	NA
50	1-Nov-24	22,145.16	NA
51	1-Dec-24	22,145.16	NA
52	1-Jan-25	22,145.16	NA
53	1-Feb-25	22,145.16	NA
54	1-Mar-25	22,145.16	NA
55	1-Apr-25	22,145.16	NA
56	1-May-25	22,145.16	NA
57	1-Jun-25	22,145.16	NA
58	1-Jul-25	22,809.51	NA
59	1-Aug-25	22,809.51	NA
60	1-Sep-25	22,809.51	NA
61	1-Oct-25	22,809.51	NA
62	1-Nov-25	22,809.51	NA
63	1-Dec-25	22,809.51	NA
64	1-Jan-26	22,809.51	NA
65	1-Feb-26	22,809.51	NA
66	1-Mar-26	22,809.51	NA
67	1-Apr-26	22,809.51	NA

10

68	1-May-26	22,809.51	NA
69	1-Jun-26	22,809.51	NA
70	1-Jul-26	23,493.80	15,110.42
71	1-Aug-26	23,493.80	15,110.42
72	1-Sep-26	23,493.80	15,110.42
73	1-Oct-26	23,493.80	15,110.42
74	1-Nov-26	23,493.80	15,110.42
75	1-Dec-26	23,493.80	15,110.42
76	1-Jan-27	23,493.80	15,110.42
77	1-Feb-27	23,493.80	15,110.42
78	1-Mar-27	23,493.80	15,110.42
79	1-Apr-27	23,493.80	15,110.42
80	1-May-27	23,493.80	15,110.42
81	1-Jun-27	23,493.80	15,110.42
82	1-Jul-27	24,198.61	15,563.73
83	1-Aug-27	24,198.61	15,563.73
84	1-Sep-27	24,198.61	15,563.73
85	1-Oct-27	24,198.61	15,563.73
86	1-Nov-27	24,198.61	15,563.73
87	1-Dec-27	24,198.61	15,563.73
88	1-Jan-28	24,198.61	15,563.73
89	1-Feb-28	24,198.61	15,563.73
90	1-Mar-28	24,198.61	15,563.73

11

91	1-Apr-28	24,198.61	15,563.73
92	1-May-28	24,198.61	15,563.73
93	1-Jun-28	24,198.61	15,563.73
94	1-Jul-28	24,924.57	16,030.64
95	1-Aug-28	24,924.57	16,030.64
96	1-Sep-28	24,924.57	16,030.64
97	1-Oct-28	24,924.57	16,030.64
98	1-Nov-28	24,924.57	16,030.64
99	1-Dec-28	24,924.57	16,030.64
100	1-Jan-29	24,924.57	16,030.64
101	1-Feb-29	24,924.57	16,030.64
102	1-Mar-29	24,924.57	16,030.64
103	1-Apr-29	24,924.57	16,030.64
104	1-May-29	24,924.57	16,030.64
105	1-Jun-29	24,924.57	16,030.64
106	1-Jul-29	25,672.31	16,511.56
107	1-Aug-29	25,672.31	16,511.56
108	1-Sep-29	25,672.31	16,511.56
109	1-Oct-29	25,672.31	16,511.56
110	1-Nov-29	25,672.31	16,511.56
111	1-Dec-29	25,672.31	16,511.56
112	1-Jan-30	25,672.31	16,511.56
113	1-Feb-30	25,672.31	16,511.56

12

114	1-Mar-30	25,672.31	16,511.56
115	1-Apr-30	25,672.31	16,511.56
116	1-May-30	25,672.31	16,511.56
117	1-Jun-30	25,672.31	16,511.56
118	1-Jul-30	26,442.48	17,006.91
119	1-Aug-30	26,442.48	17,006.91
120	1-Sep-30	26,442.48	17,006.91
121	1-Oct-30	26,442.48	17,006.91
122	1-Nov-30	26,442.48	17,006.91
123	1-Dec-30	26,442.48	17,006.91
124	1-Jan-31	26,442.48	17,006.91
125	1-Feb-31	26,442.48	17,006.91
126	1-Mar-31	26,442.48	17,006.91
127	1-Apr-31	26,442.48	17,006.91
128	1-May-31	26,442.48	17,006.91
129	1-Jun-31	26,442.48	17,006.91
130	1-Jul-31	27,235.75	17,517.12
131	1-Aug-31	27,235.75	17,517.12
132	1-Sep-31	27,235.75	17,517.12
133	1-Oct-31	27,235.75	17,517.12
134	1-Nov-31	27,235.75	17,517.12
135	1-Dec-31	27,235.75	17,517.12
136	1-Jan-32	27,235.75	17,517.12

13

137	1-Feb-32	27,235.75	17,517.12
138	1-Mar-32	27,235.75	17,517.12
139	1-Apr-32	27,235.75	17,517.12
140	1-May-32	27,235.75	17,517.12
141	1-Jun-32	27,235.75	17,517.12
142	1-Jul-32	28,052.82	18,042.63
143	1-Aug-32	28,052.82	18,042.63
144	1-Sep-32	28,052.82	18,042.63
145	1-Oct-32	28,052.82	18,042.63
146	1-Nov-32	28,052.82	18,042.63
147	1-Dec-32	28,052.82	18,042.63
148	1-Jan-33	28,052.82	18,042.63
149	1-Feb-33	28,052.82	18,042.63
150	1-Mar-33	28,052.82	18,042.63
151	1-Apr-33	28,052.82	18,042.63
152	1-May-33	28,052.82	18,042.63
153	1-Jun-33	28,052.82	18,042.63
154	1-Jul-33	28,894.41	18,583.91
155	1-Aug-33	28,894.41	18,583.91
156	1-Sep-33	28,894.41	18,583.91
157	1-Oct-33	28,894.41	18,583.91
158	1-Nov-33	28,894.41	18,583.91
159	1-Dec-33	28,894.41	18,583.91

14

160	1-Jan-34	28,894.41	18,583.91
161	1-Feb-34	28,894.41	18,583.91
162	1-Mar-34	28,894.41	18,583.91
163	1-Apr-34	28,894.41	18,583.91
164	1-May-34	28,894.41	18,583.91
165	1-Jun-34	28,894.41	18,583.91
166	1-Jul-34	29,761.24	19,141.43
167	1-Aug-34	29,761.24	19,141.43
168	1-Sep-34	29,761.24	19,141.43
169	1-Oct-34	29,761.24	19,141.43
170	1-Nov-34	29,761.24	19,141.43
171	1-Dec-34	29,761.24	19,141.43
172	1-Jan-35	29,761.24	19,141.43
173	1-Feb-35	29,761.24	19,141.43
174	1-Mar-35	29,761.24	19,141.43
175	1-Apr-35	29,761.24	19,141.43
176	1-May-35	29,761.24	19,141.43
177	1-Jun-35	29,761.24	19,141.43
178	1-Jul-35	30,654.08	19,715.67
179	1-Aug-35	30,654.08	19,715.67
180	1-Sep-35	30,654.08	19,715.67
181	1-Oct-35	30,654.08	19,715.67
182	1-Nov-35	30,654.08	19,715.67

15

183	1-Dec-35	30,654.08	19,715.67
184	1-Jan-36	30,654.08	19,715.67
185	1-Feb-36	30,654.08	19,715.67
186	1-Mar-36	30,654.08	19,715.67
187	1-Apr-36	30,654.08	19,715.67
188	1-May-36	30,654.08	19,715.67
189	1-Jun-36	30,654.08	19,715.67
190	1-Jul-36	31,573.70	20,307.14
191	1-Aug-36	31,573.70	20,307.14
192	1-Sep-36	31,573.70	20,307.14
193	1-Oct-36	31,573.70	20,307.14
194	1-Nov-36	31,573.70	20,307.14
195	1-Dec-36	31,573.70	20,307.14
196	1-Jan-37	31,573.70	20,307.14
197	1-Feb-37	31,573.70	20,307.14
198	1-Mar-37	31,573.70	20,307.14
199	1-Apr-37	31,573.70	20,307.14
200	1-May-37	31,573.70	20,307.14
201	1-Jun-37	31,573.70	20,307.14
202	1-Jul-37	32,520.91	20,916.35
203	1-Aug-37	32,520.91	20,916.35
204	1-Sep-37	32,520.91	20,916.35
205	1-Oct-37	32,520.91	20,916.35

16

206	1-Nov-37	32,520.91	20,916.35
207	1-Dec-37	32,520.91	20,916.35
208	1-Jan-38	32,520.91	20,916.35
209	1-Feb-38	32,520.91	20,916.35
210	1-Mar-38	32,520.91	20,916.35
211	1-Apr-38	32,520.91	20,916.35
212	1-May-38	32,520.91	20,916.35
213	1-Jun-38	32,520.91	20,916.35
214	1-Jul-38	33,496.54	21,543.84
215	1-Aug-38	33,496.54	21,543.84
216	1-Sep-38	33,496.54	21,543.84
217	1-Oct-38	33,496.54	21,543.84
218	1-Nov-38	33,496.54	21,543.84
219	1-Dec-38	33,496.54	21,543.84
220	1-Jan-39	33,496.54	21,543.84
221	1-Feb-39	33,496.54	21,543.84
222	1-Mar-39	33,496.54	21,543.84
223	1-Apr-39	33,496.54	21,543.84
224	1-May-39	33,496.54	21,543.84
225	1-Jun-39	33,496.54	21,543.84
226	1-Jul-39	34,501.43	22,190.16
227	1-Aug-39	34,501.43	22,190.16
228	1-Sep-39	34,501.43	22,190.16

17

229	1-Oct-39	34,501.43	22,190.16
230	1-Nov-39	34,501.43	22,190.16
231	1-Dec-39	34,501.43	22,190.16
232	1-Jan-40	34,501.43	22,190.16
233	1-Feb-40	34,501.43	22,190.16
234	1-Mar-40	34,501.43	22,190.16
235	1-Apr-40	34,501.43	22,190.16
236	1-May-40	34,501.43	22,190.16
Option Period 1:
237	1-Jun-40	34,501.43	22,190.16
238	1-Jul-40	35,536.48	22,855.86
239	1-Aug-40	35,536.48	22,855.86
240	1-Sep-40	35,536.48	22,855.86
241	1-Oct-40	35,536.48	22,855.86
242	1-Nov-40	35,536.48	22,855.86
243	1-Dec-40	35,536.48	22,855.86
244	1-Jan-41	35,536.48	22,855.86
245	1-Feb-41	35,536.48	22,855.86
246	1-Mar-41	35,536.48	22,855.86
247	1-Apr-41	35,536.48	22,855.86
248	1-May-41	35,536.48	22,855.86
249	1-Jun-41	35,536.48	22,855.86

18

250	1-Jul-41	36,602.57	23,541.54
251	1-Aug-41	36,602.57	23,541.54
252	1-Sep-41	36,602.57	23,541.54
253	1-Oct-41	36,602.57	23,541.54
254	1-Nov-41	36,602.57	23,541.54
255	1-Dec-41	36,602.57	23,541.54
256	1-Jan-42	36,602.57	23,541.54
257	1-Feb-42	36,602.57	23,541.54
258	1-Mar-42	36,602.57	23,541.54
259	1-Apr-42	36,602.57	23,541.54
260	1-May-42	36,602.57	23,541.54
261	1-Jun-42	36,602.57	23,541.54
262	1-Jul-42	37,700.65	24,247.79
263	1-Aug-42	37,700.65	24,247.79
264	1-Sep-42	37,700.65	24,247.79
265	1-Oct-42	37,700.65	24,247.79
266	1-Nov-42	37,700.65	24,247.79
267	1-Dec-42	37,700.65	24,247.79
268	1-Jan-43	37,700.65	24,247.79
269	1-Feb-43	37,700.65	24,247.79
270	1-Mar-43	37,700.65	24,247.79
271	1-Apr-43	37,700.65	24,247.79
272	1-May-43	37,700.65	24,247.79

19

273	1-Jun-43	37,700.65	24,247.79
274	1-Jul-43	38,831.67	24,975.22
275	1-Aug-43	38,831.67	24,975.22
276	1-Sep-43	38,831.67	24,975.22
277	1-Oct-43	38,831.67	24,975.22
278	1-Nov-43	38,831.67	24,975.22
279	1-Dec-43	38,831.67	24,975.22
280	1-Jan-44	38,831.67	24,975.22
281	1-Feb-44	38,831.67	24,975.22
282	1-Mar-44	38,831.67	24,975.22
283	1-Apr-44	38,831.67	24,975.22
284	1-May-44	38,831.67	24,975.22
285	1-Jun-44	38,831.67	24,975.22
286	1-Jul-44	39,996.62	25,724.48
287	1-Aug-44	39,996.62	25,724.48
288	1-Sep-44	39,996.62	25,724.48
289	1-Oct-44	39,996.62	25,724.48
290	1-Nov-44	39,996.62	25,724.48
291	1-Dec-44	39,996.62	25,724.48
292	1-Jan-45	39,996.62	25,724.48
293	1-Feb-45	39,996.62	25,724.48
294	1-Mar-45	39,996.62	25,724.48
295	1-Apr-45	39,996.62	25,724.48
296	1-May-45	39,996.62	25,724.48

20

Option Period 2:
297	1-Jun-45	39,996.62	25,724.48
298	1-Jul-45	41,196.52	26,496.21
299	1-Aug-45	41,196.52	26,496.21
300	1-Sep-45	41,196.52	26,496.21
301	1-Oct-45	41,196.52	26,496.21
302	1-Nov-45	41,196.52	26,496.21
303	1-Dec-45	41,196.52	26,496.21
304	1-Jan-46	41,196.52	26,496.21
305	1-Feb-46	41,196.52	26,496.21
306	1-Mar-46	41,196.52	26,496.21
307	1-Apr-46	41,196.52	26,496.21
308	1-May-46	41,196.52	26,496.21
309	1-Jun-46	41,196.52	26,496.21
310	1-Jul-46	42,432.41	27,291.10
311	1-Aug-46	42,432.41	27,291.10
312	1-Sep-46	42,432.41	27,291.10
313	1-Oct-46	42,432.41	27,291.10
314	1-Nov-46	42,432.41	27,291.10
315	1-Dec-46	42,432.41	27,291.10
316	1-Jan-47	42,432.41	27,291.10

21

317	1-Feb-47	42,432.41	27,291.10
318	1-Mar-47	42,432.41	27,291.10
319	1-Apr-47	42,432.41	27,291.10
320	1-May-47	42,432.41	27,291.10
321	1-Jun-47	42,432.41	27,291.10
322	1-Jul-47	43,705.39	28,109.83
323	1-Aug-47	43,705.39	28,109.83
324	1-Sep-47	43,705.39	28,109.83
325	1-Oct-47	43,705.39	28,109.83
326	1-Nov-47	43,705.39	28,109.83
327	1-Dec-47	43,705.39	28,109.83
328	1-Jan-48	43,705.39	28,109.83
329	1-Feb-48	43,705.39	28,109.83
330	1-Mar-48	43,705.39	28,109.83
331	1-Apr-48	43,705.39	28,109.83
332	1-May-48	43,705.39	28,109.83
333	1-Jun-48	43,705.39	28,109.83
334	1-Jul-48	45,016.55	28,953.12
335	1-Aug-48	45,016.55	28,953.12
336	1-Sep-48	45,016.55	28,953.12
337	1-Oct-48	45,016.55	28,953.12
338	1-Nov-48	45,016.55	28,953.12
339	1-Dec-48	45,016.55	28,953.12

22

340	1-Jan-49	45,016.55	28,953.12
341	1-Feb-49	45,016.55	28,953.12
342	1-Mar-49	45,016.55	28,953.12
343	1-Apr-49	45,016.55	28,953.12
344	1-May-49	45,016.55	28,953.12
345	1-Jun-49	45,016.55	28,953.12
346	1-Jul-49	46,367.04	29,821.72
347	1-Aug-49	46,367.04	29,821.72
348	1-Sep-49	46,367.04	29,821.72
349	1-Oct-49	46,367.04	29,821.72
350	1-Nov-49	46,367.04	29,821.72
351	1-Dec-49	46,367.04	29,821.72
352	1-Jan-50	46,367.04	29,821.72
353	1-Feb-50	46,367.04	29,821.72
354	1-Mar-50	46,367.04	29,821.72
355	1-Apr-50	46,367.04	29,821.72
356	1-May-50	46,367.04	29,821.72

23

EX-10.2

Exhibit 10.2

 

 

 

 

 

 

 

 

 

 

 

 

 

 

EX-99.1

Exhibit 99.1

Power REIT Acquires Property for Cannabis Processing and Expansion of Existing Property in Highly Accretive Transactions

Old Bethpage, New York, September 18, 2020 (GLOBE NEWSWIRE) Power REIT (NYSE-AMEX: PW) (“Power REIT” or the “Trust”) today announced that it has acquired a 3.0 acre property in York County, Maine (the “505 Property”) for $400,000 through a wholly owned subsidiary (“PropCo”).

The Property is adjacent to a property (the “495 Property”) that was acquired by PropCo on May 15, 2020 that is leased to “Sweet Dirt” as the operator. The 495 Property has a 32,800 square-foot greenhouse that is under active construction and is on track for completion by the end of 2020. It also has a 2,800 square foot processing/distribution building with construction recently completed. A virtual tour of the recent status of the greenhouse construction can be accessed here: Sweet Dirt Virtual Tour

In acquiring the 505 Property, PropCo exercised an option it received at the time of the acquisition of the 495 Property. Concurrent with the acquisition, PropCo amended the lease with Sweet Dirt whereby the lease will cover both properties and PropCo will fund the construction of an additional approximately 9,900 square feet of processing space and the renovation of an existing approximately 2,738 square foot building on the 505 Property. The completion of construction on the 505 Property is targeted for the Summer of 2021.

Sweet Dirt’s owners are authorized by the state of Maine for medical cannabis cultivation, processing and distribution at the 495 Property and will secure an additional cannabis processing license for the 495 Property before construction is completed. As part of the acquisition, the existing triple net lease is being amended whereby PropCo will fund approximately $1.56 million of costs to complete the construction. Accordingly, Power REIT’s total investment in the 505 Property is approximately $1.96 million. The lease amendment is structured to provide straight-line annual rent of approximately $373,000 which is an FFO yield of approximately 19% on the incremental invested capital.

The combined properties are expected to be one of the largest cannabis greenhouse cultivation and processing/distribution properties in the state of Maine upon completion of construction at both parcels. In addition, PropCo has the option to finance the construction of additional greenhouse cultivation space on the 505 Property for Sweet Dirt which is targeted for 2021.

David Lesser, Power REIT’s Chairman and CEO, commented, “This transaction further strengthens our relationship with Sweet Dirt as we build out a multifaceted cannabis campus for them. Sweet Dirt has demonstrated that they can become a strong leader in the Maine regulated cannabis market. We are excited to support their tremendous growth efforts in the highly fragmented Maine market which is projected for tremendous growth.”

Hughes Pope, Co-Founder of Sweet Dirt commented, “We are thrilled to have the continued confidence and support of Power REIT as we ramp up production to meet the growing demand from existing and future cannabis patients and consumers. The expansion of our cannabis campus in Eliot, Maine will allow us to deliver year-round, organically grown artisanal cannabis and a wide variety of premium cannabis derived products to the Maine market.”

Jim Henry, CEO of Sweet Dirt, commented, “Power REIT is providing a real estate solution that enables us to move towards our vision of becoming a large-scale producer of the highest quality cannabis and cannabis related products in Maine. The addition of this state-of-the-art processing facility will allow us to capture significant market share for our products. This transaction with Power REIT allows us to accelerate our vertically integrated platform within Maine’s cannabis market which is poised for rapid growth. We are currently experiencing product shortages in Maine and Sweet Dirt looks forward to fulfilling a sizable portion of this demand. Upon completion later this year, we will have a state-of-the-art greenhouse that will feature exceptional performance to grow high-quality cannabis at a competitive cost.”

Mr. Lesser commented, “We are pleased to be part of these and future Sweet Dirt transactions, that should position them as a dominant player in the Maine cannabis market. Upon completion of both parcels, Sweet Dirt will have the largest cannabis greenhouse cultivation facility in Maine and will also one of the few fully vertically integrated cannabis companies with greenhouse cultivation, processing, and retail sales. We also anticipate funding the expansion of Sweet Dirt’s greenhouse cultivation capacity on this newly acquired parcel of land in 2021 on similar economic terms.”

Mr. Lesser continued, “Our existing portfolio of cannabis greenhouse properties are on track with respect to construction and rent payments. With an extensive acquisition pipeline, we feel optimistic that we will be able to deploy the remainder of the capital currently available for investment in the near term. Cannabis operators currently have limited access to capital sources which means that Power REIT should be able to deploy much needed capital at attractive risk adjusted returns.”

Expansion of Sherman Lot 6, Ordway Colorado

In addition to the Sweet Dirt transaction described above, Power REIT has agreed to fund the expansion of its property located in Ordway, Colorado (“Sherman 6”), a five-acre property owned by a subsidiary of Power REIT. Construction is largely complete on the 23,896 square foot greenhouse/processing facility that is currently operational and currently has approximately 1,800 cannabis plants growing onsite. Power REIT has agreed to fund the expansion of the greenhouse head-house by 2,520 square feet to accommodate additional processing space, for $151,301. In conjunction with this transaction, the original 20-year lease has been amended to provide additional straight-line rent of approximately $29,000 per year which translates to an approximately 19% yield.

CORE FFO ASSUMPTIONS

The acquisition and expansion transactions are immediately accretive to CORE FFO by adding approximately $402,000 of straight-line rent that translates to incremental CORE FFO of approximately $0.21 per share per annum on a run rate basis. Omitting future available capital deployments, this transaction along with the other recently announced greenhouse related transactions should increase CORE FFO per share to approximately $1.76 per year on a run rate basis which compares to $0.56 prior to embarking on our updated business plan in July 2019. Assuming Power REIT deploys its existing available capital prior to the end of the year, the year-end “run-rate” for FFO per share should be in excess of $2.00 per share.

As previously disclosed, Power REIT recently completed a $15.5 million debt financing at a rate of 4.62% which fully amortizes over a 35-year term. Approximately $12.1 million have now been earmarked to acquire assets and expand existing greenhouse cultivation properties. In addition to the transactions announced today, the remainder of the capital available for investment is anticipated to be deployed by Power REIT through an extensive acquisition pipeline of targeted CEA facilities in the form of greenhouses.

Mr. Lesser, concluded “Since embarking on our new business plan in July 2019, which pivoted our focus specifically to Controlled Environment Agriculture (“CEA”) properties, Power REIT continues to prove out the benefits of this strategy through dramatic growth in CORE FFO. The combination of our relatively small size and the attractive rates of return that Power REIT is investing in greenhouse properties, translates to the potential for significant additional growth. At this point, Power REIT trades at a lower multiple than typical REITs while having a clear path to growth that far exceed the REIT market in general. We believe this represents a compelling investment opportunity with the potential for attractive risk adjusted returns.”

Statement on Sustainability

Power REIT owns real estate related Controlled Environment Agriculture, Renewable Energy and Transportation.

CEA Properties, such as greenhouses, provide an extremely environmentally friendly solution, which consume approximately 70% less energy than indoor growing operations that do not benefit from “free” sunlight. CEA facilities use 90% less water than field grown plants, and all of Power REIT’s greenhouse properties operate without the use of pesticides and avoid agricultural runoff of fertilizers and pesticides. These facilities cultivate medical Cannabis, which has been recommended to help manage a myriad of medical symptoms, including seizures and spasms, multiple sclerosis, post-traumatic stress disorder, migraines, arthritis, Parkinson’s disease, and Alzheimer’s.

Renewable Energy assets are comprised of land and infrastructure associated with utility scale solar farms. These projects produce power without the use of fossil fuels thereby lowering carbon emissions. The solar farms produce approximately 50,000,000 kWh of electricity annually which is enough to power approximately 4,600 home on a carbon free basis.

Transportation assets are comprised of land associated with a railroad, an environmentally friendly mode of bulk transportation.

About Sweet Dirt

Sweet Dirt is a Maine cannabis company and producer of organically grown cannabis and cannabis-infused products. The owners of Sweet Dirt produce organically grown medical cannabis and cannabis-infused products. The company’s focus on the creation of its proprietary soils and organic growing practices have earned it the MOGFA-certified clean cannabis designation achieved by fewer than 1% of all licensed cannabis growers in Maine. Additional information about Sweet Dirt can be found on its website: www.sweetdirt.com

About Power REIT

Power REIT is a real estate investment trust (REIT) that owns real estate related to infrastructure assets including properties for Controlled Environment Agriculture, Renewable Energy and Transportation. Power REIT is actively seeking to expand its real estate portfolio related to Controlled Environment Agriculture and Renewable Energy. Additional information about Power REIT can be found on its website: www.pwreit.com

Cautionary Statement about Forward-Looking Statements

This document includes forward-looking statements within the meaning of the U.S. securities laws. Forward-looking statements are those that predict or describe future events or trends and that do not relate solely to historical matters. You can generally identify forward-looking statements as statements containing the words “believe,” “expect,” “will,” “anticipate,” “intend,” “estimate,” “project,” “plan,” “assume”, “seek” or other similar expressions, or negatives of those expressions, although not all forward-looking statements contain these identifying words. All statements contained in this document regarding our future strategy, future operations, future prospects, the future of our industries and results that might be obtained by pursuing management’s current or future plans and objectives are forward-looking statements. You should not place undue reliance on any forward-looking statements because the matters they describe are subject to known and unknown risks, uncertainties and other unpredictable factors, many of which are beyond our control. Our forward-looking statements are based on the information currently available to us and speak only as of the date of the filing of this document. Over time, our actual results, performance, financial condition or achievements may differ from the anticipated results, performance, financial condition or achievements that are expressed or implied by our forward-looking statements, and such differences may be significant and materially adverse to our security holders.

CONACT:

David H. Lesser, Chairman & CEO	Mary Jensen, Investor Relations
dlesser@pwreit.com	mary@irrealized.com
212-750-0371	310-526-1707
301 Winding Road Old Bethpage, NY 11804
www.pwreit.com