Emerald Health Therapeutics, Inc. (CSE: EMH) (OTCQB: EMHTF) reported its financial results for the year ending June 30, 2022, as it closes the curtains on the cannabis industry. Total revenue for Emerald Health in the second quarter fell to C$1.28 million from C$3.77 million in the previous year.
Emerald Health shareholders approved an agreement with Skye Bioscience Inc. (OTC: SKYE) on Aug. 19 with 87.07% of the vote.
Last year, Emerald Health said that it planned to sell off its cannabis properties and focus on pharmaceutical development, hiring Vantage Point Advisors to see which companies would be interested in a strategic merger to help the transition from the recreational and medical cannabis business.
The company said that it decided to go with Skye after reviewing several companies. Skye is a San Diego-based pharmaceutical company developing proprietary, synthetic cannabinoid derivatives to treat glaucoma and other diseases with significant unmet needs.
The Supreme Court of British Columbia on Aug. 25 issued a final order approving the plan of arrangement with Skye and declared that the arrangement was procedurally and substantively fair and reasonable. The transaction is expected to close prior to Oct. 15 after receiving Skye shareholder approval.
Emerald Health transferred its 39,401,608 shares to its shareholders as a return of capital but continues to hold 86 shares and its common share purchase warrants.
The lease on one of the company’s two facilities at its Victoria, B.C. operation expired on Feb. 28 and the lease on the other facility expired on May 31. Emerald fully wound down all operations at the Victoria facilities as of June 1 and continued to rent both facilities on a month-to-month basis to maintain its Health Canada license as an asset to be sold.
Growing and processing of cannabis continued at its St. Eustache, Q.C. operation until June 30. Emerald Health retained agents in the first quarter to assist in the sale of the cannabis production operation. The company has not yet entered into a binding sale agreement with respect to this facility and the sale process is ongoing.
Throughout the discontinuation process, Emerald Health retained its cannabis sales agreements with the various provinces and continued to sell newly produced and inventoried cannabis dried flower and oils at a reduced volume until June 30.
Emerald Health entered into an agreement on April 14 with the landlord for its Metro Vancouver greenhouse facility under which the lease, which extended to 2047, would be terminated effective Dec. 31 in exchange for transfer to the landlord of the non-leased equipment and greenhouses owned by the company at the site. Emerald also has an option to terminate the lease prior to the end of the year.
The company also entered into an amended agreement with FlowerPod LLC on April 28 for the sale of certain patents. The company continues to retain the two-year interest-bearing promissory note issued by FlowerPod on May 6, 2021, in the amount of US$350,000.