It’s time for your Daily Hit of cannabis financial news for January 21, 2020.
On The Site
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.
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.
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.”
Just as the psilocybin mushroom market begins to heat up, one enterprising entrepreneur has quickly snapped up the trademark for the word “Psilocybin.” Marijuana Moment picked up on the founder’s notice on LinkedIn that the word had been trademarked. That post has since disappeared and while there is no mention of the trademark happening on the company’s website, the tiny TM does appear after each mention of the word Psilocybin on the company’s website.
In Other News
TILT Holdings Inc. (CSE: TILT) (OTCQB: TLLTF) released the following letter today from the Company’s interim Chief Executive Officer Mark Scatterday.
As we progress in 2020, we are moving forward with a reinvigorated sense of purpose and energy. Our vision is clear: TILT supports cannabis businesses across the globe through our portfolio of innovative technology companies. From software solutions to inhalation technology and more, TILT helps over 2,000 brands and retailers achieve success in this ever-changing industry. While 2019 was a challenging year for public companies in our industry, l am encouraged and reassured knowing that we have such a strong and supportive group of people working together with us and toward the same goals.
The rest is available online.
Canada House Wellness Group Inc. (CSE: CHV) announced that it has issued 30,000,000 common shares at a deemed price per share of $0.05 to each of Fabian Henry and Michael Southwell pursuant to separate debt settlement agreements entered into between the Company and each such individual for the satisfaction of $3,000,000 of the Company’s remaining earn-out obligations from its 2016 acquisition of Marijuana for Trauma, which payments were originally due in November 2019. This debt settlement was priced at a premium of 67% to the 10-day volume weighted average trading price of the Common Shares on the Canadian Securities Exchange for the period ended January 17, 2020.
“Having our two founding shareholders settle a major liability on our balance sheet by way of a share issuance at a premium to market not only shows their belief and support in the strength of our business, but also significantly improves the state of our balance sheet,” said Canada House CEO, Chris Churchill-Smith. “We would like to thank Mike and Fabian for their continued support and look forward to working closely with them to grow our business, particularly as it relates to the military veteran community.”