Debra BorchardtMay 12, 2023
The revision would allow existing medical operators to enter the adult-use market by the end of this year.
RIV Capital Archives - Green Market Report
Debra BorchardtMay 12, 2023
StaffMarch 1, 2023
The Daily Hit is a recap of the top financial news stories for March 1, 2023.
On the Site
Cowen Will No Longer Cover the Cannabis Sector
Cowen Group was one of the first major financial institutions to cover the cannabis industry on the equity research side, but on Wednesday, TD Bank Group (TSX: TD) (NYSE: TD) announced on Wednesday that it completed its acquisition of Cowen Inc. (Nasdaq: COWN) and subsequently dropped coverage. Read more here.
Riv Capital Third Quarter Revenue Flat, CEO Leaves
RIV Capital Inc.‘s (CSE: RIV) (OTC: CNPOF) CEO Mark Sims left the company, effective immediately. The company made the announcement alongside its financial results for the quarter ending Dec. 31, 2022. Revenue for Riv Capital’s fiscal third quarter (which is essentially sales from New York medical operator Etain) was $2 million, only a slight improvement over second-quarter revenue of $1.9 million. Read more here.
Other cannabis earnings reports:
SEC Orders Adam Nugent, FWM to Pay $3 Million over Cannabis Investment Scheme
The Securities and Exchange Commission announced on Tuesday that it had settled fraud charges against Utah-based registered investment adviser Foresight Wealth Management (FWM) and its principal, Adam E. Nugent, for violations related to a private fund they managed. Read more here.
Michigan’s Cannabis Sales Avoid Collapse Over Unpaid METRC Fees
Michigan’s marijuana industry narrowly avoided a near-complete stoppage this week due to a miscommunication with its private tracking system service provider. Florida-based METRC LLC recently instituted a new monthly service fee of $40 per month, which came as a surprise to those in the industry who say they never received an invoice. Read more here.
In Other News
Steep Hill Inc.
Steep Hill Inc. (CSE: STPH) entered into a settlement and release agreement with its wholly owned subsidiary Steep Hill Inc. and several Green Analytics parties to terminate license agreements between the parties as of Feb. 28. As a result, Steep Hill has no continuing licensed operations in the states of Massachusetts, New Jersey, and Pennsylvania and will continue not engaging in any such actives in Maryland. Read more here.
Greenway Greenhouse Cannabis Corp.
Greenway Greenhouse Cannabis Corporation (CSE: GWAY) (OTC: GWAYF), a cultivator of greenhouse cannabis for the Canadian market, generated revenue of $1 million for the third quarter of fiscal year 2023, an increase of 103% compared to the same quarter in fiscal 2022. Read more here.
Debra BorchardtMarch 1, 2023Company is trying to get into the adult-use market.
Debra BorchardtFebruary 23, 2023
RIV Capital Inc. (CSE: RIV) (OTC: CNPOF) settled its conflict with JW Asset Management LLC (JWAM) related to the company’s acquisition of New York medical cannabis operator Etain. JWAM had complained about the purchase price paid for Etain by Riv Capital.
Etain Settlement
RIV Capital has repurchased for cancellation all RIV Capital Class A common shares currently owned or controlled by JWAM and its affiliates, amounting to 33,733,334 shares, for an aggregate purchase price of $19,625,000. RIV Capital also reimbursed certain legal expenses incurred by JWAM as part of its application and related matters in the amount of $375,000.
RIV Capital funded such amounts with cash on hand. As part of the settlement, JWAM and its affiliated funds have also withdrawn their requisition for a special meeting of the company’s shareholders currently scheduled for June 6, which meeting will be canceled by the company.
JWAM sought a remedy requiring the JWAM Shares to be repurchased by the company at a price of C$1.65 (US$1.22) per share. This math works out to US$0.58 per share.
“I am glad to have reached a mutually beneficial agreement that enables both parties to move forward in a positive manner,” said Mark Sims, director, president, and chief executive officer of RIV Capital. “In our view, our share price simply does not reflect the intrinsic value of our unique assets – industry-leading liquidity, reputable strategic partner, and vertical license in New York.
“Our board of directors, on the recommendation of the Conflicts Review Committee, which is comprised solely of independent directors, determined that this settlement is in the best interest of the company, as it mitigates the risks associated with the application and the remedies sought by JWAM,” Sims continued. “Now that these claims have been resolved, we can focus on continuing to operationalize New York, in addition to exploring a range of opportunities inside and outside of New York as we seek to build our platform going forward.”
Hawthorne Settlement
The Hawthorne Collective Inc. owned by Scott’s Miracle-Gro (NYSE: SMG), also said it settled its conflict with JWAM and Jason Wild.
According to the statement, Jason Wild and JWAM have agreed, among other things, not to take any action that would interfere with The Hawthorne Collective’s agreements with the company or any rights set forth in those agreements.
Debra BorchardtFebruary 8, 2023They allege Wild wanted Etain for himself.
Debra BorchardtFebruary 1, 2023
Despite industry-wide challenges, CEO still believes in the promise of the cannabis sector.
John SchroyerFebruary 1, 2023
Mark Sims optimistic, despite shareholder push to oust him.
StaffDecember 21, 2022The Daily Hit is a recap of cannabis business news for Dec. 21, 2022.
ON THE SITE
Unhappy Riv Capital Investors Want to Toss Board
JW Asset Management, the largest shareholder of RIV Capital (OTC: CNPOF), has called for a special meeting of shareholders to replace five of the seven directors on the board. At the heart of the dissatisfaction is the price paid for New York cannabis company Etain. Read more here.
Shaq Wants His Cannabis Money Back
Basketball legend Shaquille O’Neal and business partner Jerome Crawford spent $150,000 investing in Viceroy LLC back in 2017. Viceroy was supposed to use the money to invest in legal cannabis businesses but is now described as a “black hole” with no evidence of having made any efforts with the money. Read more here.
Housing Works Gets First Legal Adult-Use Cannabis Sales in New York
New York will meet its self-imposed end-of-year deadline to launch recreational cannabis sales, with 48 hours to spare. At the state’s Cannabis Control Board meeting Wednesday, the agency’s executive director revealed that the first licensed adult-use marijuana sales will take place Dec. 29 at a dispensary run by the nonprofit Housing Works, one of the 36 retail license recipients announced a month ago. Read more here.
Trulieve Extends 2023 Cash Runway with $71.5 Million in Financing
Trulieve Cannabis Corp. (CSE: TRUL) (OTCQX: TCNNF) on Wednesday closed on a financing deal that will provide the company additional funds to the tune of $71.5 million. The commercial loan is secured by a cultivation and manufacturing site in Florida, and the company said it will pay interest at a fixed rate of 7.53% for the duration of the five-year loan – a solid rate for the cannabis industry. Read more here. Read more here.
SNDL Bets on Nova for the Long Run, Revises Accord
SNDL (Nasdaq: SNDL) and Nova Cannabis (OTCQB: NVACF) have fashioned new terms for their existing relationship as the two look to grab more market share in a consolidating Canada. Read more here.
IN OTHER NEWS
Greenway Greenhouse Cannabis Corp.
Greenway Greenhouse Cannabis Corporation (CSE: GWAY) (OTC: GWAYF), a cultivator of greenhouse cannabis for the Canadian market, entered into a binding third-party purchase and sale agreement for the sale of a surplus greenhouse for a purchase price of C$7.5 million. Read more here.
New Leaf Ventures Inc.
New Leaf Ventures Inc. (CSE: NLV) (OTC: NLVVF) has entered into an amalgamation agreement with High Profile Holdings Corp., pursuant to which New Leaf has agreed to acquire all of the issued and outstanding common shares of High Profile by way of a statutory three-cornered amalgamation. Read more here.
Debra BorchardtDecember 21, 2022The Etain acquisition sparked the unrest.
StaffDecember 15, 2022The Daily Hit is a recap of cannabis business news for Dec. 15, 2022.
ON THE SITE
California Investor Claims Fraud on CBD Company
A California investment manager has filed a lawsuit against the principals of a fraudulent CBD company claiming the individuals misrepresented their experience and the company. The court complaint, filed Dec. 9, accuses Paul Fiore and Jay Rifkin of claiming to have cannabis business experience, when they didn’t, and inflating the valuations of companies they were operating. Read more here.
HEXO Beats on Revenue, Cuts Cash Burn as it Tries to Stay Alive
HEXO Corp. (TSX: HEXO) (Nasdaq: HEXO) posted earnings that beat revenue expectations as restructuring acrobatics over the past year continues to play out for the company. Net revenues for the quarter were C$35.8 million, down 29% versus C$50.2 million in the same period last year. The company said that the decline was attributable in part to “the timing of revenue recognition as certain shipments failed to reach their destination due to severe weather towards the period end.” Read more here.
RIV Capital Closes Acquisition of Etain, Preps for Expansion in New York
RIV Capital Inc. (CSE: RIV) (OTC: CNPOF), an acquisition and investment firm, closed its previously announced acquisition of Etain LLC, one of 10 vertically integrated cannabis operators in New York. Under the terms of the transaction, RIV Capital paid the remaining purchase price with $42 million in cash and C$8.7 million in newly issued shares. Read more here.
University of Illinois Plans Cannabis Research Center
Discovery Partners Institute, the University of Illinois research center underway in the South Loop, has high hopes to launch a marijuana research facility. DPI has support from the city of Chicago and the state of Illinois, but it doesn’t yet have funding commitments from either one for a project that likely will need tens of millions to become a reality. Read more here.
Primitiv Tackles the Michigan Cannabis Market
Michigan-based cannabis company Primitiv is dedicated to the advancement of cannabis as a form of elevated wellness, believing that the plant holds incredible potential as a healing agent. Green Market Report caught up with co-founders, Calvin Johnson Jr. and Rob Sims, at MJBizCon in November to talk about how they’re tackling the Michigan market. Check out the conversation here.
IN OTHER NEWS
Diego Pellicer Worldwide
Diego Pellicer Worldwide Inc. (OTC Market: DPWW), a premium cannabis company, announced that it has signed a binding settlement term sheet with its Colorado tenants, Royal Asset Management LLC and Venture Product Consulting LLC. Under the terms, Neil Demers, the majority owner of RAM and VPC, will transfer and cause to transfer 100% of all membership interests of RAM and 99% of membership interests of VPC to Diego or a special purpose acquisition company designated by Diego. The agreement resolves a lawsuit in which the company alleged that RAM was in breach of contract for failure to make payments under sublease agreements and a promissory note that Diego issued to RAM. Read more here.
C21 Investments
C21 Investments Inc. (CSE: CXXI) (OTCQX: CXXIF) (“C21” or the “Company”), a vertically integrated cannabis company, reported revenue of $7.2 million for the third quarter ended Oct. 3. Overall revenue fell 0.4% from the second quarter, while sales in Nevada declined 14.7% during the period. Read more here.
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