Northern Lights Archives - Green Market Report

StaffSeptember 19, 2022

The Daily Hit is a recap of cannabis business news for September 19, 2022.

ON THE SITE

Zeroed In On Germany, Curaleaf Acquires Majority Stake in Four20 Pharma

Curaleaf Holdings, Inc. (CSE: CURA) (OTCQX: CURLF) said that it acquired a 55% stake in Four20 Pharma, a top five German producer and distributor of medical cannabis in the European Union. The deal is worth €19.7 million or approximately $19.7 million, according to SEDAR filings. Read more here.

High Tide Borrows $19 Million For Expansion

High Tide wants to go from 140 stores to 150 – High Tide Inc. (Nasdaq: HITI) (TSXV: HITI) closed on a $19 million senior secured credit facility with connectFirst Credit Union Ltd., with an initial 5-year term, at connectFirst’s floor interest rate. The company said its plan was to use the proceeds to expand its store count. Read more here.

Tri-State Area Expects Thousands Of Cannabis Jobs

As legalization marches forward in the tri-state area, so do the hopes for job creation. A new report from Cannabiz Media outlined those aspirations and how much these new employees could cost. The report dives explicitly into New York, New Jersey, and Connecticut as the tri-state region in the Northeast. Read more here.

Icanic Brands To Buy Coachella Valley Boutique Dispensary

The acquisition will be paid in stock. – Icanic Brands Company, Inc. (CSE: ICAN) (OTCQB: ICNAF) said that it plans to acquire The Leaf, a luxury boutique dispensary located in Palm Desert, California. Under the accord, Icanic will acquire The Leaf for a price tag based on the dispensary’s trailing twelve months of revenue calculated on the date of closing. Read more here.

The Future Psychedelics Workforce Is Getting Schooled Today

A jump in research studies sparks increased educational programs – There is a growing need for more therapists, more clinicians, and more researchers in the psychedelics industry. Academic institutions around the world are beginning to add courses and training programs to their list of curricula available for any student who wants to specialize in some aspect of psychedelics, in an effort to quickly build a psychedelics workforce. Read more here.

Jane Technologies Honored For The Best E-Commerce Platform At Green Market Report Tech Awards

Jane’s unique platform offers dispensaries and cannabis brands a turnkey e-commerce solution with many marketing and analytics options. The Green Market Report Tech Awards were presented following the first-ever Green Market Report Tech Summit on Sept. 8 at The Pearl event space in San Francisco. This week, we’ll be providing a closer look at the honorees. Read more here.

IN OTHER NEWS

Denver City Council Considers Changes to Marijuana Rules in Effort to Bolster Delivery

Denver City Council will consider a proposal Monday to drastically cut license fees for marijuana delivery services and extend — forever — a requirement that delivery company owners come from socially disadvantaged backgrounds. The current “social equity” mandate is set to end in 2024, but the city aims to call the bluff of dispensaries waiting until then to establish their own delivery services rather than rely upon the existing businesses. Read more here.

Medical Marijuana Company Sues Minnesota Over THC Regulations

A Minnesota-based medical cannabis company is suing the state over its THC regulations, claiming discrimination. Last week, Vireo Health filed a civil lawsuit against the Minnesota Department of Health, the state and several county attorneys, saying Minnesota’s THC laws discriminate against Vireo. Read more here.

NY’s Oneida Indian Nation to Launch Cannabis Operation

The Oneida Indian Nation will start construction next month on a full-scale, 50,000-square-foot cannabis cultivation and production facility. Retail locations, which will be announced at a later date and located exclusively on Nation lands, are projected to open in late 2023. The entire cannabis operation, from seed to sale, will be operated by the Oneida Indian Nation. The cultivation and manufacturing facility will be located on Hill Road in Verona, New York. Read more here.

Red White & Bloom Brands Inc.

Red White & Bloom Brands Inc. (CSE: RWB and OTC: RWBYF) a multi-state cannabis operator and house of premium brands, announced the appointment of Colby De Zen as President and Director of the Company effective immediately and the appointment of Gabriel Bianchi to the Board of Directors upon completion of regulatory approvals. The company further announces that it has restructured the terms of certain outstanding debentures issued by the company to arm’s length lenders in the aggregate principal amounts of USD $70,040,000 and CDN $2,120,000 and issued a new convertible debenture in the principal amount of CDN $17,000,000. Read more here.

Northern Lights Acquisition Corp.

Northern Lights Acquisition Corp. (Nasdaq: NLIT), a special purpose acquisition company, announced that it has amended that certain unit purchase agreement dated February 11, 2022, by and among the company, 5AK, LLC, the company’s sponsor, SHF, LLC d/b/a Safe Harbor Financial, a Colorado limited liability company, SHF Holding Co., LLC, a Colorado limited liability company and the sole member of Safe Harbor, and partner Colorado Credit Union, a Colorado corporation and the sole member of the seller, to extend the date by which the transactions contemplated thereby had to be consummated from August 31, 2022 until September 28, 2022, and provide for the deferral of $30 million of the $70 million due to the seller at the closing of the business combination. Read more here.

Rubicon Organics Inc.

Rubicon Organics Inc. (TSXV: ROMJ) (OTCQX: ROMJF), a licensed producer focused on cultivating and selling organic certified, premium cannabis, provided a corporate and operational update for the period ending August 31, 2022. Read more here.

BYND Cannasoft Enterprises Inc.

BYND Cannasoft Enterprises Inc. (NASDAQ: BCAN) (CSE: BYND) announced yesterday that it has signed a share purchase agreement to acquire 100% ownership of Zigi Carmel Initiatives & Investments Ltd., which holds the patent pending intellectual property for a therapeutic device that uses low concentrations of CBD oils, such as hemp seed oil and other natural oils, to treat certain women’s health issues. Read more here.

TREES CORPORATION

TREES CORPORATION (OTCQB: CANN) announced that is has signed definitive documents to acquire the Green Tree Longmont and Green Tree Berthoud dispensaries in the state of Colorado, over 34,000 square feet of grow operations and a state-of-the-art manufacturing facility. This acquisition will add to the company’s current footprint in Colorado and will bring its total number of Colorado dispensaries to 4 along with 3 operational stores in Oregon, for a total of 7 retail dispensaries. Read more here. Read more here.

Exclusive Brands

Exclusive Brands, a Michigan-based vertically integrated cannabis company composed of retail locations, a processing and manufacturing facility, and licensed grow operations, as well as home to cannabis brands, announced today that the company has added an indoor facility and greenhouses to their existing farm located in Arlington, Michigan. Read more here.

BellRock Brands Inc.

BellRock Brands Inc. (CSE: BRCK.U), a cannabis consumer packaged goods and intellectual property platform, announced that its subsidiary, Ironton Properties, LLC, has finalized the sale of its Denver real property to a third-party buyer for $2.5 million USD. Approximately $2 million of proceeds from the sale were used to fully repay a promissory note entered into in May of 2022. Read more here.

Psyence Group Inc.

Psyence Group Inc. (CSE: PSYG|OTCQB: PSYGF), a life science biotechnology company pioneering the use of natural psychedelics in mental health and well-being, announced that it has received approval for its Phase IIa clinical trial from the Medicines and Healthcare Products Regulatory Agency (MHRA), the UK equivalent regulatory body to Canada’s Health Canada and the US’s FDA. The clinical trial will assess the efficacy and safety of psilocybin-assisted psychotherapy versus psychotherapy alone for the treatment of adjustment disorder due to an incurable cancer diagnosis. Read more here.

Small Pharma Inc.

Small Pharma Inc. (TSXV: DMT) (OTCQB: DMTTF), a biotechnology company focused on short-acting psychedelic-assisted therapies for mental health conditions, today announced that it has completed enrollment in the Phase IIa clinical trial of its intravenous formulation of N, N-dimethyltryptamine (DMT) candidate, SPL026, with psychotherapy for the treatment of major depressive disorder. This formulation recently received patent protection in the United States under patent no. 11,406,619 for injectable formulations of DMT based compounds. Read more here.

Debra BorchardtJuly 1, 2022

SPACs (Special Purpose Acquisition Corp.) were the hottest thing going on in the cannabis industry for the past couple of years, but the buzz may be wearing off. These SPACs would raise millions and then search for a “qualifying transaction.” In other words, the money was looking for a company to essentially buy and take public. It was an easy way for cannabis companies to get investor money and quickly become publicly-traded stocks. However, these deals frequently turned sour for the secondary buyers dampening the interest.

Plus, the millions raised didn’t sync well with the size of the companies available to be a target. For example, a SPAC may raise $100 million and then pick a company that maybe did $10 million a year in revenue. Suddenly this small company was given a very rich valuation because the SPAC didn’t have much to choose from. In the beginning, this anomaly was overlooked, but investors began to become a little more discerning. One thing unique about SPACs is that investors can pull out of a deal if they think the numbers just don’t look so great. Jumping ship at the last minute can often throw a SPAC into disarray. Another unique feature of SPACs is the tight time constraints. The SPAC has only so much time to identify a target and then execute. Being forced to add more time to the clock is also a signal of trouble.

Northern Lights

This week, the Northern Lights Acquisition Corp. (Nasdaq: NLIT) SPAC had to push back its plan to use Safe Harbor Financial as its qualifying transaction. The vote had been planned earlier this week, but now has been pushed back to July 29 with the ability to extend even further to August 31. The business combination was approved by the company’s stockholders at the special meeting of stockholders held on June 28, 2022. Northern Lights said that stockholders who had previously submitted redemption requests in connection with the closing of the could ask that those redemption requests be reversed. In other words, if they chose to bail out of the deal, Northern Lights said they could change their minds. As of June 22, 2022, the company has received redemption requests for 11,416,205 shares of Class A Stock in connection with the Business Combination.

Ceres Acquisition

On Thursday, Ceres Acquisition Corp. (OTCQX: CERAF) announced that it was also extending its timeline to complete a qualifying transaction to December 16, 2022. The Extension was previously approved at a special meeting of the holders of Class A Restricted Voting Shares of Ceres held on June 22, 2022. Ceres’ board of directors has also approved the Extension, which is effective as of June 30, 2022. this isn’t the first-time, the SPAC has pushed out its timeline. Ceres’ final prospectus for its initial public offering was originally dated February 25, 2020, but then the Permitted Timeline was automatically extended from December 3, 2021 to March 3, 2022 and was further extended with the approval of the Class A Restricted Voting Shareholders to June 30, 2022.

Ceres was going to do a deal with Parallel, but that got called off when the company’s finances came under question. Now Ceres says that it believes that it “has identified a number of promising targets and is currently evaluating the business of these prospective targets and engaging in active discussions with an aim towards announcing an exciting qualifying transaction for Ceres’ security holders in the near future.”

Debra BorchardtFebruary 14, 2022

Cannabis banking company Safe Harbor Financial (SHF, LLC) will go public through the SPAC (special purpose acquisition corporation) Northern Lights Acquisition Corp. (NASDAQ: NLIT) has chosen it for the qualifying transaction. Safe Harbor is a subsidiary of Partner Colorado Credit Union, a Colorado-chartered credit union based in Arvada, Colorado. Safe Harbor will be led by Sundie Seefried, Founder and Chief Executive Officer of Safe Harbor.

“The acquisition by Northern Lights will allow Safe Harbor to advance its efforts to remain the premier cannabis financial services provider,” said Seefried. “Over the last seven years, our team has pioneered what many consider to be the industry standard cannabis banking platform by establishing strong internal processes and controls, and by complying with rigorous state and federal banking guidelines. Through the SPAC transaction, we believe Safe Harbor will be well-positioned to expand its suite of financial services for our existing and new clients and continue to support the growth of the cannabis industry at a very high level. Our goal is to become a ‘one-stop-shop’ for cannabis business financial needs.”

Safe Harbor was formed in 2015 by the PCCU to provide an unmet need, which was compliant access to banking and financial services for the cannabis industry. Over the past seven years, Safe Harbor has grown to nearly 600 accounts spanning 20 states. Additionally, Safe Harbor has processed over $11 billion in transactions with $4 billion in 2021 and has grown deposits at a 73% CAGR since inception. Safe Harbor addresses these challenges with its industry-leading financial services and commercial lending platform, providing its clients with increased safety and security through access to normalized banking and cash management. Through its proprietary risk management and compliance program, Safe Harbor operates under regulations promulgated under the Bank Secrecy Act and additional FinCEN guidance, as demonstrated by passing 15 state and federal examinations since inception.

Transaction Details

Northern Lights will acquire Safe Harbor for a total of $185 million, of which $70 million will be paid in cash and $115 million in shares of Northern Lights Class A common stock. The estimated post-transaction equity value of the company will be approximately $327 million, assuming no redemptions by the stockholders of Northern Lights. The transaction will provide up to $107 million of gross proceeds (assuming no redemptions), including $117 million from Northern Lights’ cash-in-trust and a fully committed $60 million PIPE from institutional investors.

“Safe Harbor is the most compelling investment opportunity we have encountered in the cannabis industry as both operators and investors. Safe Harbor is one of the only multi-state financial service organizations to successfully navigate the highly regulated cannabis banking industry, providing services that operators in other industries take for granted,” noted John Darwin and Joshua Mann, Co-CEOs of Northern Lights, both of whom will remain on Northern Lights’ Board of Directors upon completion of the transaction. “Setting the gold standard for regulatory compliance, as well as providing access to growth capital across the entire cannabis value chain, Safe Harbor is uniquely positioned to scale. We are confident that our collective experience in the cannabis industry and strong pipeline of lending opportunities are complementary to the incredible business Sundie and her team have established.”

NCIA Cuts Staff to Six, Cites Revenue Downturn

New Jersey Revokes Cannabis Company’s Licenses Over $700k in Unpaid Fees

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Northern Lights Archives - Green Market Report

The Daily Hit: September 19, 2022

ON THE SITE

IN OTHER NEWS

SPACS Losing Their Mojo As Deals Get Pushed Out

Northern Lights

Ceres Acquisition

Safe Harbor To Go Public Through SPAC

NCIA Cuts Staff to Six, Cites Revenue Downturn

New Jersey Revokes Cannabis Company's Licenses Over $700k in Unpaid Fees

C21 Sheds Weight, Maintains Free Cash Flow Despite Revenue Slump

ON THE SITE

IN OTHER NEWS

Northern Lights

Ceres Acquisition

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