LEEF Archives - Green Market Report

StaffJune 8, 2022

Icanic Brands Company, Inc. (OTCQB: ICNAF) has entered into a Restructuring Support Agreement with certain holders of its 2019 Secured Convertible Debentures for a proposed recapitalization transaction and to announce financing of approximately $2.0 million arranged by insiders of the company. The move will decrease the Icanic’s debt from $14.5 million to $10.9 million and save $110,000 in interest annually.

The Recapitalization Transaction is the next step in the combination and integration of the Icanic and LEEF organizations following the closing of the merger of the companies on April 21, 2022. The Recapitalization Transaction will reduce the company’s outstanding indebtedness and debt service costs, improve its overall capital structure and result in an enhanced financial foundation for the company to allow it to move forward and execute upon its business plan.

“After an extensive review process, consultation with our financial and legal advisors and careful consideration of our available options, the Board has unanimously approved the proposed Recapitalization Transaction,” said Icanic CEO Brandon Kou. “We believe that the Recapitalization Transaction allows Icanic to move forward with a stronger capital structure and we are excited to execute on our short and long term business plan which we believe will create significant value for our stakeholders.”

Micah Anderson, CEO of LEEF said, “The decline in the overall public equity cannabis markets, coupled with the extraordinary market conditions brought on by the pandemic and the delay we experienced in closing the Icanic transaction have resulted in some liquidity constraints for the company. The Recapitalization Transaction effectively allows our 2019 debenture holders to extend the term of their debenture on better terms with mechanisms in place that allow for significant upside as we continue to build our business. The objective of the company is to reduce its outstanding indebtedness and its annual interest costs, improve the company’s overall capital structure, and most importantly, provide a stable financial foundation for the company to capitalize on the opportunities we have in front of us, which I believe to be very meaningful. The Recapitalization Transaction achieves all of these objectives and I look forward to its completion.”

Debra BorchardtFebruary 16, 2022

Despite numerous other cannabis companies managing to complete their bookkeeping during the pandemic, Icanic Brands (OTC: ICNAF) is now blaming Covid as the reason its financial filings are late. The delay has resulted in a cease trade order by the British Columbia Securities Commission under National Policy 11-207. The financials are related to the fiscal year ending in July 2021 and the quarter ending in October 2021. Icanic has already received one extension from the BC Securities Commission that ended on February 11, 2022.

Management has had its wings clipped for trading and now that extends to all shareholders with the Canadian shares. The OTC shares are continuing to trade.

Icanic said in a statement that it “has been delayed in completing its audited financial statements as a result of Covid-19 related delays in obtaining information with respect to subsidiaries acquired during the current and prior year, as well as a change in auditors from the previous fiscal year. The previous acquisitions and auditor change has required certain expert reports and an increase in the overall scope of the audit, both of which have caused the delay in the Annual Filings. The Company is actively and expeditiously working with its auditors to file the Annual Filings, at which point the Company will seek to have the CTO revoked and trading reinstated on the CSE. The Company also confirms, as of the date of this news release, that there is no other material information concerning the affairs of the Company that has not been generally disclosed.”

No Financials Published In Almost A Year

The last published earnings for the company were almost a year ago when financials for the third quarter ending April 2021 were published. At that time, revenues were just C$3.2 million and the company only had cash of roughly C$2 million. In September 2021, the company said it had sold its interest in a Sacramento, CA Cultivation facility to Crowco Management LLC, a California-based limited liability company, for $2 million.

Since April the company has been making one acquisition after another. The company said it was buying THC Engineering, De Krown Enterprises, Substance LLC and then the biggest deal being LEEF Holdings, which is valued at $120 million.

The company also stated that it is working towards closing the acquisition of LEEF Holdings, Inc., as previously announced on January 25, 2022. LEEF is one of the largest cannabis extraction companies in the state of California and is a leading provider of bulk concentrates to many of the largest brands in the state. LEEF’s manufacturing capabilities include a 12,000 sq. ft state of the art extraction and manufacturing facility with up to 45 tons of biomass throughput per month and up to 3,000 liters of distillate extraction capability per month.