.03 Social Equity Partnership Grant Program.

A. The Social Equity Partnership Grant Program shall promote qualifying partnerships between operational cannabis licensees and social equity licensees.

B. The Office of Social Equity shall implement and administer the grant program, including approving qualifying partnerships.

C. The Office of Social Equity may approve a qualifying partnership where a cost or other fee is imposed by an operational cannabis licensee, if it determines the cost or other fee is substantially reduced from the market value.

D. If an operational cannabis licensee has a license that was converted under Alcoholic Beverages and Cannabis Article, §36-401(b)(1)(ii), Annotated Code of Maryland, the total amount of grants issued to the licensee may not exceed the lesser of:

(1) The cost of the conversion fee that was paid by the licensee to date; or

(2) $250,000 per year per qualifying partnership.

E. Qualifying partnerships under this regulation may not:

(1) Explicitly or implicitly transfer, including through convertible debt, any ownership or control from the social equity licensee to the operational cannabis licensee;

(2) Require the social equity licensee to conform with any branding, messaging, standard operating procedures, or other infringement on the social equity licensees’ operations; or

(3) Otherwise restrict, hinder, exploit, or unfairly treat the social equity licensee to benefit the operational cannabis licensee.

F. In addition to any other applicable penalties established in this subtitle, including suspending, fining, restricting, or revoking a license, an operational cannabis licensee found in violation of § E of this regulation may be subject to any of the following sanctions:

(1) Restriction, revocation, or invalidation of any qualifying partnership approved by the Office of Social Equity;

(2) Rescission or invalidation of any attempted transfer of ownership or control; or

(3) Repayment of any grant funding received by the operational cannabis licensee.