Debra BorchardtDebra BorchardtJanuary 28, 2020


TerrAscend Corp. (CSE: TER)(OTCQX: TRSSF) has named the company’s Executive Chairman Jason Ackerman as the interim CEO, replacing the current CEO Michael Nashat. Nashat will continue to serve as a member of the Board of Directors and act as a strategic advisor to the company.

Gravitas Acquisition Is Over

Just yesterday, TerrAscend terminated its decision to acquire Gravitas Nevada Ltd. which operates a retail cannabis dispensary in Las Vegas, Nevada under the trade name “The Apothecarium.”  The transaction, for $33.5 million in cash and 625 proportionate voting shares in the equity of TerrAscend equivalent to 625,000 common shares of the Company, was originally announced on February 11, 2019. TerrAscend has paid a $3mm reverse termination fee to the sellers, which had been placed in escrow in June of 2019.

As part of the termination, the Company is no longer liable for the remaining $30.5 million and proportionate voting shares in the equity of TerrAscend equivalent to 625,000 common shares of the Company. TerrAscend has agreed to continue licensing The Apothecarium, State Flower and Valhalla names and related intellectual property to Gravitas and its related operations in Nevada, pursuant to such final terms as will be mutually agreed by the parties.


“While it was a difficult decision, I believe given TerrAscend’s premier operating assets in the United States, it is now time for me to step into an advisory role and let new U.S.-based management guide TerrAscend as they expand and scale,” said Michael Nashat. “Jason’s experience in omnichannel retail, distribution, and operations are skills that TerrAscend will lean on as it enters this new growth phase. In my time working alongside Jason, it is clear that he is the right person to take on this role, and as a large shareholder, I believe this is what is best for securing TerrAscend’s future. I look forward to continuing to advise the Company in my board position and as a strategic advisor.”

“We are grateful for the hard work and perseverance that Michael Nashat has demonstrated during his tenure as CEO and Co-Founder of TerrAscend,” said Jason Ackerman. “We will continue to value Michael’s technical expertise, commitment to research and pharmaceutical knowledge, as he shifts to a strategic advisory role. We remain committed to driving shareholder value and focusing on the areas of our business that are generating rapid growth and greater margins, particularly in our valuable CaliforniaPennsylvania, and New Jersey markets. I look forward to building upon the foundation that Michael has laid, and leading the TerrAscend team forward in this next exciting phase.”

Debra BorchardtDebra BorchardtJanuary 23, 2020


Green Market Report’s Editor-in-Chief Debra Borchardt spoke with MedMen CEO Adam Bierman regarding the word from vendors that payments have been delayed. This interview has been edited slightly. 

Editor-in-Chief Debra Borchardt:

We’ve confirmed that the emails posted online from MedMen telling vendors that payments will be late are real. We’ve also confirmed that vendors had said they haven’t been paid.

MedMen CEO Adam Bierman:

Those emails are absolutely, real emails. We’ve never denied those emails. We’ve been very forthright with the public, and with our investment community at large about the fact that at the end of last year we entered into a restructuring in the business, exiting the hyper-growth stage of the business, and getting into sustainability, and with that, there’s a lot of pain. And that pain starts at the employees that were on this mission with us, building this platform with us that we had to part ways with. A lot of them are like family that has been with us for a very long time.

That’s unfortunate. That’s hard. But it was necessary. During that timeframe, we stopped payments to certain vendors as would be commonplace in the restructuring of a retailer. We turned over our accounts payable to a restructuring consulting firm (FTI Consulting) so that we could preserve and allocate the cash as we got through and out the other end of restructuring. These are brands that heavily rely upon MedMen for their business. Especially in California, we understand how important MedMen is to that ecosystem and we understand what happens, and the impact, and the ripple effect it has on these manufacturers. They’re having discussions like that with our teams about structuring payments.

Some of these people are my very good friends that we came up in this business together for the last decade. But I also say that there have been plenty of times where, well, roles have been reversed and we’ve been asked to be partners, long term partners to some of these groups. I think that’s just part of building an industry. There will be times when you’ll be asked to help others out in the industry. And there’ll be times when it’s vice versa.  We are probably 30 days away from being out the other end of this restructuring.

Our cash position is very healthy, our balance sheet is strong. We’ve made a couple of announcements over the last month about bringing in fresh capital by way of selling some equity as well as selling some non-core assets, and the business is well-positioned going forward. So, the unfortunate reality of growth, which we’ve all seen over the last 10 years, is what we were faced with. This is all stages. And so, this was a stage that we went through, but we’ll come out the other end and.

GMR: One of the things that you got out of the PharmaCann break up was the Illinois licenses. Are you planning on holding onto those Illinois licenses or are you thinking that you’ll see if there’s a good price for them?

Bierman:  No, I think at this point in time we’ve sold the non-core assets that we believed could bring in the most near term cash and also include our near to mid-term prospects of profitability. And we’re through that. There are no additional states or assets that we currently plan to sell out. We did sell the cultivation facility, in Illinois from PharmaCann. That was one of the assets that we sold. But as far as the retail stores go, it is a market that we believe to be important to our near and mid-term health. The two stores we have open now are averaging 200 transactions per hour. That’s per store in Illinois.

GMR:             The CFO situation, you guys have been through a lot of turmoil on the CFO side, and of course, that doesn’t look good to the market. Do you feel like you’ve started to get stability in that office in the C suite?

Bierman:                   I’ll start by saying that the Zeeshan Hyder is outstanding and the company is so fortunate to have him in that seat. I guess I would say on a broader basis, we are very aggressive in how we iterate and evolve our business. And you’ve seen it, and I’ve lived it for the last 10 years. And part of that evolution is constantly wanting the best talent with the most amount to contribute to the business and within the context of whatever stage the business is in. As you’re aware, it was only a couple of years ago that people from the traditional industry wouldn’t work in cannabis. I think we were among the first organizations in cannabis to attract talent from mainstream industry. And so, where I think where you mentioned the word turnover, we look at it as an evolution. We are constantly evolving. If we can get better, we get better.

GMR:   Was hiring FTI consultants, was that part of the deal with your investors? Gotham Green? Gotham has extended a lot of credit to you guys and they’ve also kind of stepped in as part of the board, et cetera. Was that part of their idea to bring in FTI to kind of right the ship?

Bierman:                   Yeah, I don’t know where that rumor started cause I try not to pay attention, but there’s never been a point in time where our lenders haven’t quote, “stepped in.” We’ve had a facility as Gotham, we renegotiated that facility in the fall to get the company way more flexibility amidst this backdrop. We have a second lending group that we renegotiated with a few weeks ago that gave us way more flexibility and also pushed that out for a couple of extra years. So our relationship at this point with our lenders is solid.

I think when you talk about our primary investors, our relationship is on solid footing.  Our biggest equity holder, outside equity holder, is Wicklow Capital, who wrote an eight-figure check into our equity round two weeks ago. So, we have a lot of continued support from those groups. Now, I don’t know if we would’ve had that support if we hadn’t taken all the actions we’ve taken to put ourselves in a position to thrive for what’s next. But we’ve done that, and I think, as a result, we continue to have their backing.

So, we brought FTI in to help us through the restructuring when it comes to things like AP. We brought in different resources for very specific purposes. And then some of the work we did ourselves just rather than taking all the commitments off our balance sheet in regards to payroll, extra infrastructure and projects. And then the restructuring of both facilities, plus our accounts payable.

In the fall, I recognized that I probably was six months behind taking actions that, at that point in time, we decided to take. We were down at that point in time as we sit here, middle to the end of January, we’re positioned to thrive. I mean this company has never been healthier.

It’s not just that our lenders have stepped up to support us because of their long term belief in how well we’re positioned and it’s not just that Wicklow stepped up and wrote another eight-figure check because of how well we’re positioned, it’s because how much they believe in the value of the check they just wrote. And how cheap the stock currently is versus where it will be as we execute. But me, Chris, and Andrew wrote checks into the last equity round. So, the last equity round was 60 plus percent, me, Chris, Andrew and Wicklow. And these are the people that understand what’s going on within the business better than anybody in the world. So, again not taking away from the pain and the difficulty and the stress of what that restructuring was, and absolutely having the humility to be able to admit that’s something that should have taken place six months earlier. All that, notwithstanding, and get to a place in January where maybe the people on the inside of this business understand how well positioned and undervalued it is for where it’s headed.

GMR:             Well, the creditors are selfish. They ultimately want to see you succeed because that’s how they’re going to get their money back. I mean, they, it does not behoove them to send you down the drain cause then, they’re going to lose their investment. You know, they, it’s ultimately in their best interests that MedMen succeed so that they get paid back, basically.

Bierman:                   Yes, yes. 100%, which is why some of these rumors are just so silly. But MedMen has $1 billion in license value across all our licenses and MedMen has a market cap right now of $350 million dollars. So, I guess, on one hand, the lenders, if they believe in where we’re at, and they believe in the upside of the business. 100% that leads to the support that we have received from them, but nonetheless, we’re still in a position where if that belief wasn’t there, the net asset value of the business is over three times today what our market cap is. So, I think if that belief wasn’t there, we might’ve seen other actions taken from these lenders. So yes, you’re 100% right. This is the path of least resistance for everybody. I do think that there’s a credibility lift in the fact that they chose this route.

Debra BorchardtDebra BorchardtJanuary 22, 2020


The NERA Economic Consulting (www.nera.com) recently published a report that noted a trend in cannabis class action lawsuits being filed for 2019. The report wrote, “Between July and December 2019, six cases were filed on behalf of investors in the cannabis industry alleging either (1) failure to disclose weak demand for the product or the expected decline in revenue and profits or (2) misrepresentations related to quality of the product, the status of inventory, or markup on biological assets.”

These are the companies in which cases were filed in the 2nd Circuit Court:

India Globalization Capital, Inc.     Filed on: 02 Nov 18 Pending
CannTrust Holdings Inc.                 Filed on: 10 Jul 19 Pending
Sundial Growers Inc.                         Filed on: 25 Sep 19 Pending
HEXO Corp.                                       Filed on: 26 Nov 19 Pending
Trulieve Cannabis Corp.                  Filed on: 30 Dec 19 Pending

In the 3rd Circuit Court were:

Canopy Growth Corporation          Filed on: 20 Nov 19 Pending
Aurora Cannabis Inc.                       Filed on: 21 Nov 19 Pending

In addition to the suite that NERA mentioned, Charlotte’s Web Holdings Inc. and Infinite Product Co. are both dealing with proposed consumer class suits in California. These cases are alleging the companies improperly marketed products made from CBD. The suits were sparked by Warning Letters published by the FDA in November. They allege that products made by both Charlotte’s Web and Infinite did not abide by the FDA regulations and, as such, violate California law.

The cases are Dasilva v. Infinite Product Co., C.D. Cal., No. 2:19-cv-10148, complaint 11/27/19; McCarthy v. Charlotte’s Web Holdings, Inc., N.D. Cal., No. 5:19-cv-07836, complaint 11/30/19.

Charlottes Web had labeled their products as dietary supplements, which seems to be what the FDA took issue with. The FDA has written, “Based on available evidence, FDA has concluded that THC and CBD products are excluded from the dietary supplement definition under section 201(ff)(3)(B) of the FD&C Act [21 U.S.C. § 321(ff)(3)(B)]. Under that provision, if a substance (such as THC or CBD) is an active ingredient in a drug product that has been approved under section 505 of the FD&C Act [21 U.S.C. § 355], or has been authorized for investigation as a new drug for which substantial clinical investigations have been instituted and for which the existence of such investigations has been made public, then products containing that substance are excluded from the definition of a dietary supplement.”

The Infinite Products situation is a little different. That company included marketing statements like “CBD can alleviate some symptoms of autism, that cannabinoids have been found to inhibit the growth of cancer cells, and that, because of opiods’ addictiveness and painful withdrawal symptoms, people have moved to using CBD.”

According to NERA, in all class action cases, the median settlement value was $12.4 million, the highest since 2012, indicating that more cases are settling for higher values than in previous years. “The Aggregate NERA-defined Investor Losses for filed cases decreased from 2018’s record high of $929 billion to $519 billion, largely due to a decline in cases with Investor Losses of $5 billion or more. However, aggregate Investor Losses for cases with losses of $5 billion or less was $173 billion, the highest this decade.”



Debra BorchardtDebra BorchardtJanuary 22, 2020


With all the attention heaped upon new legal states like Illinois and Michigan, it’s easy to forget about the OG Oregon. The Bulletin reported earlier this week that Oregon’s cannabis sales continue to climb higher. The Oregon Liquor Control Commission reported that sales for 2019 totaled $793 million, which was $150 million more than in 2018.

According to the article, the sales generated more than $110 million in tax revenues. These sales are also expected to reach one billion dollars for 2020.

The top five counties in terms of legal, recreational cannabis sales to consumers were:

Multnomah $203.9 million

Washington $75.3 million

Lane           $70 million

Marion        $50.6 million

Deschutes   $39.6 million

Source: Oregon Liquor Control Commission

The Border Effect

Multnomah County is home to Portland, which explains why its sales were so much greater than other counties. The article also noted that the smaller counties of Baker and Malheur were growing quickly due to their proximity to the state of Idaho, which has not legalized recreational marijuana.

The Oregon Economic Analysis wrote, “Obviously recreational marijuana is not legal in Idaho, but even after throwing the data into a rough border tax model that accounts for incomes, number of retailers, tax rates and the like, there remains a huge border effect. Roughly speaking, about 75% of Oregon sales and more like 35% of Washington sales in counties along the Idaho border appear due to the border effect itself and not local socio-economic conditions. Furthermore, and in things you cannot make up, Oregon sales per adult along the Idaho border are 420% the statewide average.”

This analysis also points to increased sales along the Washington state line. Even though Washington has legalized recreational sales, there are more stores in Oregon and the taxes are lower. The report wrote, “Finally, the last finding decomposes the differences in sales seen along the Oregon-Washington border itself. Overall sales are 16% higher per capita on this side of the Columbia than the other. This speaks to product availability and the final price to consumers being key driving factors in consumer spending patterns, which create much of the border effect.”

The analysis also stated, “Both Oregon and Washington see a clear impact in higher recreational marijuana sales along the Idaho border than can be explained by local socio-economic factors. Now, this does not mean that all of those larger sales are necessarily to Idahoans. It could be other customers may be traveling from further away or from elsewhere within our state who are traveling through.

All told, recreational marijuana sales continue to increase and are expected to do so in the decade ahead. Our office’s forecast calls for sales to grow approximately 80% over this time period as incomes grow, the state’s population increases, and marijuana becomes more socially acceptable and usage rates rise.”

Vape Sales Drop

According to BDS Analytics data cited by Canaccord Genuity in its December report, Oregon’s vape sales declined by 12% year-over-year, while other categories experienced growth. Flower sales rose to 45% versus 39% last year. Pre-rolls grew from 7% to 9% YOY and non-vape concentrates grew from 9% to 11% YOY.

Debra BorchardtDebra BorchardtJanuary 21, 2020


Two weeks ago, Harvest Health & Recreation Inc. (CSE: HARV)(OTCQX: HRVSF) filed suit against Falcon International, Inc. asking to terminate the planned merger agreement and return the money Harvest paid to Falcon under the Merger Agreement. That lawsuit alleged that Falcon’s principals stalled due to the falling share price of Harvest. Harvest went on to suggest that Falcon International engaged in illegal activities.

Today, Falcon has said that Harvest owes the company $50 million in a breakup fee. In addition to that Falcon said, “Amounts previously funded by Harvest to Falcon are convertible into Falcon equity at Harvest’s or Falcon’s option and, accordingly, are unlikely to be paid.”

Headed To Divorce Court

The original merger agreement dates back to February 2019, when cannabis stocks were still firmly in green territory, but then the bear market took hold and the entire sector saw stock valuations plummet. There was no provision in the merger agreement with regards to a stock selloff and according to the lawsuit, Falcon executives  James Kunevicius and Edlin Kim wanted to renegotiate the Merger Agreement which resulted in the June
7, 2019 Amendment. This increased the stock consideration to $240 million.

Harvest stock was trading roughly around $7.47 a share in February 2019, by August it was down to $3.19. It has lately recovered and was recently trading near $3.51, above its 52-week lows of $2.03.

Harvest said that by August and September, it had loaned Falcon roughly $47 million and still hadn’t closed the merger. Falcon began demanding more money according to Harvest suggesting Harvest would be in breach if it didn’t pay. Harvest was now questioning the use of the money that had already been sent. Despite that, it still looked like the merger would close in October 2019. This is when Falcon began filing “standstill agreements” and essentially stalled the closing process.

The two companies met at the MJ Biz Conference in Las Vegas in December. Harvest described it in this manner, ”

“The business meetings at the convention were non-productive, with one Falcon representative (Edlin Kim) appearing at the meeting with visibly large amounts of cash in his front pocket and back pocket and in a bag, and wearing what appeared to be many tens of thousands of dollars in men’s jewelry made of gold, and with both Falcon representatives (Edlin Kim and James Kunevicius) expressing no interest in doing any work to move the planned transaction with Harvest forward and, instead, stating openly that Falcon would not close the Merger Agreement, as amended, due exclusively to the decline in Harvest’s stock price.”

Harvest Lawsuit

The lawsuit from Harvest claimed that Harvest had performed all of its legal obligations, but that Falcon did not produce auditable financial information or records concerning its business operations and revenue despite repeated requests. Harvest also accused Falcon of transporting cannabis across state lines and that the company was not complying with California state law regarding the regulation of sales of marijuana.

Harvest said in the lawsuit that it has paid over $50 million in cash and advances, but that Falcon executives complain about being unhappy about the deal. Harvest said it wants its money back. Harvest also claims that Kunevicius and Kim pocketed a $4 million payment that was supposed to go to the company and have no intention of paying the money back and believe they are entitled to it.


Debra BorchardtDebra BorchardtJanuary 21, 2020


Once touted as the first “unicorn” in cannabis IPO’s, MedMen Holdings Inc. (OTC: MMNFF) is now struggling to pay vendors. In addition to telling vendors, it wouldn’t be able to pay its bills until February or March, the company has been selling assets and also announced it was laying off employees in November. The Twittersphere was active on the subject as Jason Spatafora @WolfofWeedSt lead the charge by posting several exchanges between unidentified vendors and MedMen executives.

“That’s Shitty News”

One unnamed vendor’s email from MedMen’s Senior Director of Strategic partnerships, Ben Shultz read, “Sorry for the delay. We received our payment schedule from our consultant’s FTI and had them signed off by our CFO. I wish I had better news here, but unfortunately, we don’t have payments scheduled for you in the near term. We are working on longer cash term infusions, but it is unlikely that we will be able to pay off these invoices before Feb/March.” He goes on to write, “That’s shitty news and there’s no sugar-coating it, but I have to be the messenger of bad here. If and when we can allocate funds to pay off our AR, we will be in touch.”

One California vendor suggested vendors consult a lawyer or accountant before accepting stock instead of the money owed by MedMen. Also, not identified.

Josh Shlenker, the General Merchandising Manager wrote to another unnamed vendor, “We’ve employed a financial consultant FTI to help us devise a payment plan strategy to clear outstanding balances and get us caught up as expeditiously as possible.”

It goes on to read, “All I can realistically offer are imperfect solutions and I’ve had to have a lot of frustrating and awkward conversations. FTI is supposed to be reaching out early next week with a proposed solution for you.” It continues with, “I am working on creative arrangements with people who wish to remain in the assortment through this period and I am working to offer them more premium shelf space and trying to find fund to allocate weekly to chip away at the outstanding balances, while still planning to continue to place and receive orders on 45-60 day terms.”

Last week, CEO Adam Bierman spoke to Benzinga and acknowledged the layoffs announced in November, but that was the extent of his remarks regarding the 190 employees given the pink slip. Instead, he dwelled on the real estate choices the company was making. Yet, the company has been selling off its real estate assets (to a business that is closely connected to company executives) and then leasing the property back. Such that shareholders are really not benefiting from these assets. There was no discussion of financial difficulties.

Bierman’s point was the locations that MedMen is choosing will result in more sales. His thesis is that locations located near airports draw the tourist crowd. However, choosing a dispensary near the airport in Vegas, versus one on the strip seems like an odd choice for consumers.  (Editors note: GMR visited the Vegas MedMen dispensary during the MJ Biz conference in December and it was largely empty. NuWu ( billed as the world’s largest dispensary) was very busy with customers, as was Planet 13 and Reef Dispensaries had a line that snaked outside the door.)

No, It’s Not Bankrupt

Short-seller Grizzle.com added fuel to the fire by blasting a headline that asked, “Did MedMen Just Go Bankrupt?” It hasn’t and the general consensus is that cannabis companies can’t declare bankruptcy. According to the U.S. Courts, “All bankruptcy cases are handled in federal courts under rules outlined in the U.S. Bankruptcy Code.” Since cannabis is still federally illegal, it is suspected that the court would reject such a filing. Granted, many of these cannabis companies have complicated business structures where potential parts of the company that isn’t plant-touching could file to reorganize, but that remains to be seen or tested.

Setting up payment plans doesn’t necessarily mean a company is out of money, but with a retail business, the end of the year is typically when a company is flush with cash from holiday sales. So, not being able to pay bills at a time when there should be extra revenue coming in is cause for concern. Retailers like Wet Seal, The Limited, Eastern Outfitters and BCBG all filed for bankruptcy in February of 2017 after the holiday season. Demonstrating that this isn’t an uncommon time for retailers to call it quits.

Still, there’s the issue of total reported liabilities of $671 million as per the quarter ending in September. The revenue for the quarter was $43.9 million. This is a fairly lopsided situation. The next earnings report is on February 26, 2020.

Challenges In The C-Suite

MedMen has faced a lot of criticism since it has gone public. The company first came under fire when the May 2018 IPO disclosed the generous pay for Bierman and Co-founder Andrew Modlin, who recently purchased an $11 million home in Hollywood, despite the financial struggles of the company. The IPO also gave the founders the majority of the voting shares causing another outcry.

The company’s proposed acquisition of Pharmacann was terminated in October 2019, one bonus though is that MedMen received some Illinois licenses out of the deal. The company also took this moment to announce that Zeeshan Hyder has been appointed Chief Financial Officer at MedMen. Mr. Hyder, had been MedMen’s Chief Corporate Development Officer. Hyder succeeded Michael Kramer, who apparently was terminated as of October 7, 2019. Kramer was only just hired in December of 2018 and he followed the previous CFO James Parker who only lasted a year and a half. CFO James Parker resigned in 2019 and then followed with a scathing lawsuit that laid bare a great deal of dirty laundry.

More Ugly Rumors

If the vendor payment issues weren’t enough to scare investors, others on the Spatafora twitter feed suggested that the company had sold pesticide tainted cannabis and another said that MedMen was experiencing harvesting issues and was only selling other company’s products. None of this has been substantiated and could be sour grapes from ex-employees, however, if it is true it is troubling.

The stock was lately trading at 57 cents, down from its 52-week high of $3.84. Yahoo Finance lists the company’s market cap at $120 million. The founders have agreed to salary cuts and have relinquished a large portion of their voting rights in an effort to appease its creditors.

MedMen has not responded to a request for comment.



Debra BorchardtDebra BorchardtJanuary 17, 2020


Cannabis marketing tech firm Fyllo has acquired cannabis regulatory tech firm CannaRegs for an undisclosed amount. CannaRegs distinguished itself for the company’s ability to drill down into local cannabis regulations, which can differ between the municipality, county and state levels of oversite.

As part of the acquisition, Amanda Ostrowitz, CannaRegs’ founder and CEO, will join Fyllo as its Chief Strategy Officer to develop a global strategy focused on supporting existing and new customer relationships. She will be reporting to CEO Chad Bronstein. Fyllo said it will augment CannaRegs’ user interface and integrate CannaRegs data into its platform to enhance its compliance solutions for brands and publishers.

“The cannabis space is exploding and expected to grow to more than $50 billion annually over the next five years. Digital advertising is the industry’s clear pathway to growth, and brands need to have confidence that their ad creatives are not only reaching the right audiences but also meeting state-by-state and market-by-market compliance requirements,” said Chad Bronstein, founder, and CEO of Fyllo. “CannaRegs has become the go-to-market leader for supplying the cannabis industry with reliable compliance data. Combined with our technology, we are able to provide actionable information at scale. This acquisition helps us gain a significant competitive advantage to grow Fyllo, and by joining forces with the most seasoned and knowledgeable cannabis compliance experts, it will help generate more revenue opportunities for our clients.”

While the value of the deal wasn’t disclosed, it comes on the heels of Fyllo raising $18 million to accelerate the company’s growth and expand access to advertising-compliant solutions for the cannabis industry. Fyllo recently named Clive Sirkin, the former chief growth officer of Kellogg and former CMO of Kimberly-Clark, and Katie Ford, head of global brands at Twitter, to its board.

Fyllo said it has developed a full suite of cannabis advertising solutions for brands and online publishers powered by CannaBrain, an AI engine that ingests and interrogates billions of data points, allowing brands to safely build and execute advertising campaigns while also enabling publishers to create and monetize compliant ad inventory.

“The complex nature of cannabis regulations can be challenging for brands looking to confidently enter the fast-moving space. To stay ahead of the curve, companies need to have the wherewithal to know how to operate within state and local regulatory structures,” said Amanda Ostrowitz, founder and CEO of CannaRegs. “In a short period of time, Fyllo has emerged as an essential platform for publishers and cannabis companies to build creative campaigns in a safe and compliant way. By teaming up with Fyllo, we have the chance to build a truly remarkable brand that can disrupt the entire industry.”

Ostrowitz has made a name for herself over the past five years as she has built a team that has accomplished something many were unable to do and that track the myriad of cannabis regulatory changes. Drilling down to some of the smallest towns and tracking local meetings. Her company’s data is used by law firms, real estate professionals and cannabis companies as they try to stay compliant in a constantly changing landscape.

Fyllo said it will onboard over 150 CannaRegs customers, which will get the same benefits of state and local legal understanding in near real-time, along with an enhanced CannaRegs user interface. CannaRegs’ 30 employees will continue to operate out of its Denver offices.

Debra BorchardtDebra BorchardtJanuary 16, 2020


Longtime cannabis print publisher High Times is getting into the dispensary business. The company said that it has signed a binding letter of intent to launch branded retail stores in Las Vegas and Los Angeles. The company did not specify who it had signed the agreements with or the value attached to the agreements. The locations were only described as being in high traffic areas.

The dispensaries are intended to become flagship High Times stores and in addition to selling cannabis products, will also carry High Times branded products. The stores will also feature award winners from the company’s Cannabis Cup events. There are plans to expand beyond the first two locations.

In addition to the pivot into retail, High Times has named former Grupo Flor CEO Paul Henderson as its President.
High Times noted that Grupo Flor’s store, East of Eden, was one of the top-selling retail stores in the country.
Prior to entering the cannabis industry, Henderson had an extensive career running business units at
Goldman Sachs, GE Capital, and Apple.

“There is no brand in Cannabis that compares to High Times. High Times has ten times the number of social followers of any other cannabis retail brand, not including the millions of cannabis enthusiasts who visit the company’s media properties on a monthly basis., said Henderson. “The cannabis movement has grown in no small part due to the High Times brand, and we will continue to be the source for the highest quality product in this industry – just on a much more personal and direct level.”

Adam Levin, the company’s Executive Chairman stated. “Having the second mover advantage in this industry,
combined with the present downturn in the cannabis capital markets, provides unique timing for High Times to help non-branded stores to differentiate themselves from the industry’s larger multi-state operators. I know I speak for the whole team when I say we’re extremely excited to add Paul to the Hightimes family.”

The company’s November filing had suggested that in addition to retail stores, it could also open High Times consumption cafes. There are also opportunities to use the name for smoking accessories, apparel, and movies.

 C-Suite Upheaval

The move follows the recent resignation of Kraig Fox as CEO and the appointment of Stormy Simon to that role. Fox was seen as the leader who would bring the company’s offering over the goal line and help facilitate the move towards retail and licensing opportunities. He was in the position for less than a year.

Henderson will be more than President, he will also serve as interim Chief Financial Officer stepping in for David Newberg who quit on January 7th, 2020. Newberg was just rehired for the role in July 2019 for two years with a salary of $250,000 a year. He followed Neil Watanabe who joined in April 2019 as the company’s Chief Operating Officer and Chief Financial Officer. At that time, he was replacing Newberg, who had served as CFO for two year prior. Watanabe only lasted three months as he quit in July. 

High Times Stock

The crowdfunded offering was expected to happen this past fall but has yet to come to fruition. According to the company’s filings, there are 24,384,571 issued shares, which High Times values at $11.00 giving the company a roughly $268 million market cap. The current total liabilities are $68 million and the revenue for six months ending June 30, 2019, was $10.7 million. 


Events continue to be the big breadwinner for High Times. The Cannabis Cup regularly brought in millions and basically supported the publication. It seemed that High Times was moving towards increasing its focus on events with the acquisition of Spannibus, Chalice Festivals, and The Big Show. In the last company filing though, the company was barely breaking even on events. Events brought in $6.7 million, but cost $6.5 million to produce. It was a decline of 4% from the 2018 event revenue of $7 million.

The company had a winner in Michigan, where it had record attendance and sold out its booth space. It also hit the mark with a DOPE Cup and a Daly City, CA event. However, it wasn’t enough to offset a decline in attendance and booth sales for the regular annual California events held in San Bernardino, Sacramento, and Santa Rosa. 


The Cannabis Cup events could become very important to the brands hoping to win. An award winner could conceivably gain entry to the flagship stores and also become a part of future consumption cafes. At this time no other event would be able to match this opportunity. For now, winners at cannabis festivals have only been able to use the titles for marketing purposes. If High Times is successful and commits to featuring the winners, then winning could mean lucrative sales contracts in addition to a trophy for producers and brands.


Debra BorchardtDebra BorchardtJanuary 16, 2020


Halo Labs Inc. (NEO: HALO)(OTCQX: AGEEF) has exercised its Mendo Distribution and Transportation’s (MDT) option to purchase Outer Galactic Chocolates, which is a holder of a Type N manufacturing license. MDT was recently acquired by Halo through a merger on January 9, 2020.

Kiran Sidhu, Halo CEO and Co-Founder said, “Obtaining a Type N manufacturing license in California for the production of infused and edible products is a step in diversifying Halo’s product offering in this growth category. Not only are we building new lines around award-winning expertise in OGC, we will support expanded distribution of OGC-branded chocolates to Southern California.”

The acquisition will give Halo a license to produce infused and edible cannabis products adjacent to the MDT facility in Ukiah, California. A Type N license permits manufacturers to conduct most activities including packaging and labeling, however, it does not allow for extraction. For extraction in California, Halo utilizes its Type 7 licensed facility in Cathedral City, California.

In addition to obtaining the Type N license in California, Halo said it plans to execute a management agreement with the current management of OGC to aid in the transition and buildout of the business, which will include the introduction of both Halo-branded and other white label infused products. A strategic partnership with existing management will provide a strong base for the development of new edible cannabis products in California under the Hush® brand through channels and clientele already established by OGC.


Earlier this week the company also stated that it was expanding its offering on the leading online cannabis marketplace Eaze, to include the Hush product line. Halo already successfully sells its premium GILT branded DabTabs on Eaze and will now introduce the Hush line of vape cartridges, shatter, concentrate, edibles and tinctures. The Hush brand is synonymous with high-quality cannabis products at an affordable price and is now available for delivery throughout California and Oregon. Following this second rollout of products on Eaze, Halo said expects to release more product lines on the marketplace in the future.

Eaze Director of Brand Development Owen Ruh said, “In concept and execution Halo has proven to be an innovative and dependable partner to Eaze, with products that are very popular with our customers. It’s a great time to expand the relationship and we’re excited to see what it brings.


The company also said that Bophelo Bioscience & Wellness has started the certification process required to achieve European Good Agricultural and Collection Practices accreditation for cannabis grown at the Company’s 205-hectare cultivation site at Bophelo in Lesotho, Africa.

Obtaining EU GACP certification would allow Halo to export medicinal cannabis and Cannabis-Based Products for Medicinal use to the United Kingdom as well as countries in the European Union. According to Prohibition Partners, the CBPM market in the UK is comprised of 1.4 million consumers who use CBPMs for health treatments with an additional 4.7 million recreational cannabis users. This translate to a medical cannabis market that is predicted to be worth roughly $1.3 billion by 2024.

To achieve EU GACP accreditation, Halo said it has engaged Pharmaconsulta Limited, an independent firm based out of Malta in Europe, that specializes in pharmaceutical regulatory affairs.

Sidhu added, “We are extremely pleased at the speed at which we are realizing our strategic vision for Bophelo. By the time the maiden harvest is complete the facility is expected to be fully certified and ready to export legal cannabis. International exportation is currently an untapped opportunity for Halo and will add sizeable, incremental topline revenue. We also look forward to delivering innovative strains with the DNA genetics partnership to future harvests. With three grow seasons a year anticipated at Bophelo, we expect to establish ourselves quickly as one of the leading suppliers of consistently high-quality cannabis to regulated international markets.”

Debra BorchardtDebra BorchardtJanuary 15, 2020


Canadian-based cannabis company Organigram Holdings Inc. (NASDAQ:OGI) reported that its first-quarter 2020 revenue rose by 102% over last year to $25.15 million, which beat analyst estimates by $10.24 million. Last year the company reported $12.4 million for the first quarter of 2019. The earnings per share reported by Organigram were flat, but that also beat the estimates by two cents.

Organigram delivered a net loss of $0.9 million compared to net income from continuing operations of $29.5 million last year for the same time period saying it was “largely due to non-cash fair value changes to biological assets and inventories in the prior-year quarter.”

“Despite ongoing industry challenges, we are pleased with solid Q1 2020 results and our return to positive adjusted EBITDA during the quarter,” said Greg Engel, CEO. “Our team was also successful in shipping the first of our Rec 2.0 products as planned and on schedule in December of 2019. We also look forward to the launch of the remainder of our vape pen portfolio followed soon after by our premium cannabis-infused chocolate products. In addition to an exciting line-up of 2.0 products, we are rolling out a couple of new core strains, such as our high THC Edison Limelight, across the country following their success as limited-time-offers in smaller markets.”

The company also noted that it had $1.1 million in a provision for product returns and price adjustments. This compared to the fourth quarter 2019’s  $3.7 million in a provision for product returns and pricing adjustments. “The majority of the Q1 2020 provision was related to THC oils which have seen less than anticipated demand in the adult-use recreational market. The majority of the Q4 2019 provision was related to two slower selling stock-keeping units sold to the Ontario Cannabis Store, comprised of a bespoke order of lower THC dried flower intended to fulfill a supply gap in the market earlier in calendar 2019 and THC oils.”

Putting On The Brakes

The company also stated that it had a total target production capacity of 89,000 kilos per year, it was going forward at a more slow pace. Engel said on the company’s conference call, “We believe consumer demand in Canada continues to be suppressed by the lack of retail stores, particularly in the most populous provinces of Ontario and Quebec. We can more effectively manage cash allocation and put some of the capital to better use elsewhere. And the decision to delay completion as originally designed allows us to preserve flexibility to use portions of the 4C space for other strategic purposes. We will continue to monitor market conditions and believe we can finish foreseeing a relative short time frame should consumer demand warrant.”

Canada 2.0 Rollout

Engel also said on the call that the company’s Rec 2.0 rollout plans include three SKUs of its Trailblazer vape cartridges, and they were pleased with the response to date. “We expect to make our first shipment of our three SKUs of our Feather Edison pens as early as next week. And our PAX Edison cartridge, we expect to have out in calendar Q2. Our chocolate Edison truffle bites are expected to be in market soon as well followed by Trailblazer bars and Edison bars. And rounding out our portfolio of 2.0 products is our dissolvable powder product. Our R&D team has developed a proprietary nano-emulsification technology that is anticipated to provide an initial absorption of cannabinoids within 10 to 15 minutes.”


The company said that it has $34 million in cash and short-term investments and still has $30 million in available capacity on a term loan, which remains undrawn. CFO Paolo De Luca said, “Given our cash and short-term investments of $34 million, our $30 million of untapped committed credit facility, up to $25 million available under the revolver and a potential uncommitted $35 million under the credit facility plus the $22 million raised under the ATM, we believe we have created the necessary capital and liquidity cushion to write out any volatility in the capital markets.”

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The Green Market Report focuses on the financial news of the rapidly growing cannabis industry. Our target approach filters out the daily noise and does a deep dive into the financial, business and economic side of the cannabis industry. Our team is cultivating the industry’s critical news into one source and providing open source insights and data analysis


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