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TILT Holdings Reports Fourth Quarter and Full Year 2022 Results

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Q4 revenue up 9% quarter over quarter to $44.3 million

FY 2022 cash from operations up significantly to $8.6 million, compared to cash used of $8.6 million in FY 2021

Recently completed refinancing of legacy debt, reducing principal debt outstanding by nearly half

ARIZONA: TILT Holdings Inc., a global provider of cannabis business solutions that include inhalation technologies, cultivation, manufacturing, processing, brand development and retail, is reporting its financial and operating results for the three and twelve months ended December 31, 2022. All financial information is reported in U.S. dollars and prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) unless otherwise indicated.

“2022 was a pivotal year for TILT and the cannabis industry at large,” said Chief Executive Officer Gary Santo. “Our sector faced headwinds from the overall economic environment and, to a greater extent, the sector itself adapting to cannabis as a commodity more rapidly than expected. Our financial results were not immune to these patterns. We did maintain positive adjusted EBITDA and produced positive cash flow from operations for the year, and we are committed to upholding both these trends in 2023.”

Santo continued, “Operationally, last year we signed six new brand partnerships, launched over 100 new brand partner SKUs, and won multiple awards for outstanding products, including our recent edibles wins at NECANN last week for a newly launched chocolate we produce for our partner CODA and for our own house brand millionaire shortbread. In addition, we outperformed market trends in each of the states in which we operate, highlighting the benefit of our strategy to support brand partners instead of prioritizing our own products. We also brought innovation back to Jupiter with multiple new product announcements and improved distribution terms which drove better margins in the second half of the year.

“Looking back on 2022, while our overall performance may not have been as strong as we had hoped at the outset of the year, we remained focused on implementing and refining our business strategy. We believe our asset-light approach and nimble structure coupled with the now-completed refinancing and debt reduction efforts, allows us to enter 2023 with positive momentum, a stable capital structure, on-going positive cash flow from operations and a team fully equipped to tackle the critical optimization phase of our strategic pivot.”

Q4 2022 Financial Summary

  • Revenue was $44.3 million in the three months ended December 31, 2022, compared to $54.1 million in the prior year period. The decrease in revenue was primarily driven by a significant customer order in the Company’s inhalation technology business in December 2021.
  • Gross profit was $8.3 million in the three months ended December 31, 2022, or approximately 19% of revenue, compared to $11.2 million or approximately 21% of revenue in the prior year period. The decrease in gross profit was primarily driven by price compression in the Company’s cannabis operations in Massachusetts.
  • Net loss was $73.1 million in the three months ended December 31, 2022, compared to a net loss of $20.1 million in the prior year period. The increase in net loss was primarily driven by a $54.6 million goodwill impairment related to current market conditions and its impact on the fair value of our reporting units.
  • Adjusted EBITDA (non-GAAP) was $(0.4) million in the three months ended December 31, 2022, compared to $4.5 million in the prior year period. The decrease was driven by the aforementioned price compression in the Company’s cannabis operations in Massachusetts.

Recent Financing Update

  • In February 2023, the Company announced a series of transactions that alleviated its near-term debt maturity and further reduced its non-revolving debt from $86.7 million at December 31, 2021 to $46 million on February 16, 2023. The Company repaid $2 million of debt as one of these transactions, retiring the remainder of its 2019 senior debt facility with no further obligations. For junior noteholders, the Company revised and extended terms to provide for amended and restated promissory notes with an aggregate principal balance of $38 million and issued $8.2 million of secured promissory notes to satisfy certain outstanding accounts payable.
  • In conjunction with the refinancing of the junior notes in February 2023, the Company completed a sale-leaseback transaction for its Pennsylvania cultivation and manufacturing facility for approximately $15 million.
  • Altogether, as of February 28, 2023, the Company had a cash balance of approximately $5 million and principal debt of approximately $46 million.
  • Completed final action in March 2023, by amending existing revolving credit facility to increase credit availability, improve terms and extend maturity date.

Q4 2022 Operational Highlights

  • Launched social impact driven brand Black Buddha Cannabis in Massachusetts for both patients and adult-use customers.
  • Unveiled CCELL by Smoore’s latest technology release, EVO, through the Company’s wholly-owned subsidiary, Jupiter.
  • Expanded partnership with cannabis lifestyle brand, Highsman, with the launch of “H” by Ricky Williams in dispensaries throughout the Commonwealth of Pennsylvania for medical patients.
  • Entered into an exclusive, five-year manufacture, supply and distribution agreement with Curaleaf International to bring Jupiter manufactured Liquid QueTM vaporizer to new territories abroad, for use as a medical device with extracts developed by Curaleaf International.
  • Partnered with Coda Signature, one of the cannabis industry’s leading infused chocolatiers, to launch the brand in Massachusetts for both patients and adult-use customers.
  • Announced that Jupiter will launch a proprietary initiative called Concept LVT, a first-of-its-kind, patent-pending rig-less dab solution that is an affordable, easy and clean way to experience cannabis concentrates.
  • Announced the launch of Little Beach Harvest’s ancestral plant medicine, in partnership with Shinnecock Indian Nation, to both patients and adult-use customers across Massachusetts.

FY 2022 Financial Summary

  • Revenue was $174.2 million in the twelve months ended December 31, 2022, compared to $202.7 million in the prior year. The decrease in revenue was primarily driven by lower volumes and pricing in the Company’s inhalation business, partially offset by continued growth in the Company’s cannabis operations.
  • Gross profit was $38.2 million in the twelve months ended December 31, 2022, or approximately 22% of revenue, compared to $50.2 million or approximately 25% of revenue in the prior year. The decrease in gross profit was primarily driven by pricing pressure in both the Company’s inhalation technology business and cannabis operations.
  • Net loss was $107.5 million in the twelve months ended December 31, 2022, compared to a net loss of $35.1 million in the prior year. The net loss was primarily driven by the aforementioned goodwill impairment in the fourth quarter.
  • Adjusted EBITDA (non-GAAP) was $2.8 million in the twelve months ended December 31, 2022, compared to $22.3 million in the prior year. The decrease was driven by lower revenue in the Company’s inhalation technology business and pricing pressure for both inhalation and cannabis operations.
  • Cash provided by operations was up significantly to $8.6 million for the twelve months ended December 31, 2022, compared to cash used of $8.6 million in the prior year. The increase was primarily driven by significant improvements to working capital.
  • Total cash balance was $2.2 million at December 31, 2022, compared to $7.0 million at December 31, 2021. This cash balance included restricted cash of $1.3 million at December 31, 2022, compared to restricted cash of $2.7 million at December 31, 2021. Unrestricted cash and cash equivalents were $2.2 million, compared to $4.2 million at December 31, 2021.

Earnings Call and Webcast

TILT management will host a conference call today at 5:00 p.m. Eastern time to discuss its financial and operational results, business strategy and future outlook, followed by a question-and-answer period.

Date: Thursday, March 16, 2023
Time: 5:00 p.m. Eastern Time
Toll-free dial-in number: (877) 423-9813
International dial-in number: (201) 689-8573
Conference ID: 13736759
Webcast: TILT Q4 2022 Earnings Call

Please call the conference telephone number 5-10 minutes prior to the start time. An operator will register your name and organization. If you have any difficulty connecting with the conference call, please contact Elevate IR at (720) 330-2829.

The conference call will also be broadcast live and available for replay in the investor relations section of the Company’s website at www.tiltholdings.com.

TILT Completes Final Actions Related to Debt Refinancing

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Amends Existing Revolving Credit Facility to Increase Credit Availability, Improve Terms and Extend Maturity Date; Announces Appointment of New Board Member

ARIZONA: TILT Holdings Inc., a global provider of cannabis business solutions that include inhalation technologies, cultivation, manufacturing, processing, brand development, and retail, announced the extension of its existing revolving credit facility, together with the appointment of a new board member pursuant to its recently completed debt refinancing.

Jupiter Research, LLC, a subsidiary of TILT, entered into an amendment to its existing US $10 million asset-based revolving credit facility (the “Facility”) to increase the amount available under the Facility from US $10.0 million to US $12.5 million, and extends the maturity date to July 21, 2024. Additionally, borrowings under the Facility will bear interest at the prime rate plus 3%, and the Facility is secured by Jupiter’s inventory, accounts receivable and related property. The amendment also includes a guaranty by TILT in the amount of US $6 million.

The Company also announced that, effective March 8, 2023, George Odden has been appointed to the Company’s Board of Directors (“Board”) as a noteholder designee in accordance with the recently completed debt refinancing of the Company’s junior notes. Mr. Odden served in the U.S. Navy and began a career on Wall Street focused on investment banking and M&A in the aerospace industry. Today, he is a partner with Ardent Advisory Group, a company he co-founded in 2021, focused on providing a broad range of M&A advisory services.

Gary Santo, TILT’s Chief Executive Officer, stated, “We are pleased to welcome George Odden to the Board and look forward to leveraging his financial acumen and M&A expertise, which is especially important as we explore strategic growth opportunities this year.”

Santo continued, “The amended Facility provides TILT with greater liquidity and improved borrowing terms at a time when the broader capital markets remain volatile. Our lender has been a great partner to Jupiter and TILT, and we appreciate the confidence they’ve shown with this extension and amended terms.”

Arizona State University Study Examines Health Risks in Legal Cannabis Markets

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ARIZONA:  A new study urges that state and federal regulators need to take a closer look at health and safety risks of the growing medicinal and recreational cannabis market.

“Cannabis regulation is unlike any agricultural commodities, food, or drugs in the U.S. Currently, there are no national-level guidelines based on conventional risk assessment methodologies or knowledge of patients’ susceptibility in medical use of cannabis,” said lead author Max Leung, an Arizona State University assistant professor in the School of Mathematical and Natural Sciences. 

“Therefore, our research team conducted the first comprehensive study to examine 3 main concerns: 1) the current landscape of state-level contaminant regulations, 2) identifying cannabis contaminants of concern in samples, and 3) explore any patient populations who may be susceptible to contaminants.”

The cannabis market has grown significantly in the past decade to become a $10 billion industry by 2017, $50 billion in 2026, and, within the past year, an estimated 55 million users. Currently, 15 states have made medicinal cannabis legal, but little attention has been paid to its implications in chemical exposure and consumer safety.

At the federal level, cannabis is still listed as an illegal substance. This limits the efforts of several federal agencies in assessing and mitigating the public health risk of cannabis contamination. Currently, cannabis is neither federally regulated as an agricultural, food, nor pharmaceutical commodity, so the USDA does not monitor its growth and FDA does not consider it a drug.

So, how is a cannabis user to know what they are putting into their bodies is safe? “There is surprisingly limited information on the contaminant level of cannabis products sold in this country,” said Leung.

Without any federal guidelines, it’s been left entirely up to the states to craft a patchwork of cannabis regulations and policy. “Individual legalized states and D.C. set their own rules with huge discrepancies,” said Leung.

From their study, Leung and colleagues found that as of May 2022, 36 states and the District of Columbia have listed a total of 679 cannabis contaminants listed as regulated in medical or recreational cannabis. Most of these contaminants were pesticides (551, which included 174 insecticide, 160 herbicide and 123 fungicides subcategories), followed by solvents (74), microbes (21), inorganic compounds (12), mycotoxins (5) and 16 classified as “other.”

“What was interesting is that many pesticides in this document were highly unlikely to be utilized in cannabis cultivation and processing,” said Leung.  These pesticides included chlorpropham (a plant hormone that prevents potatoes from sprouting), oxytetracycline (an antibiotic), and norflurazon (an aquatic herbicide for Hydrilla control).

“What was also alarming to us is that the U.S. EPA tolerance document and individual jurisdictions also listed a total of 42 legacy pesticides that were no longer registered for any agricultural use in the U.S., such as dichlorodiphenyltrichloroethane (DDT), chlordane, lindane and parathion.”

As to the amount of contaminants levels, there were large inconsistencies from state to state. different state jurisdictions showed significant variations in regulated contaminants and action levels ranging up to four orders of magnitude.

How often was this a problem? The research team also mined data testing records of cannabis flower and extract samples produced in California, the largest state cannabis market in the U.S. Their sample data represented about 6% of California’s legal production in 2020-2021.

“As mandated by California’s Medicinal and Adult-Use Cannabis Regulation and Safety Act, all cannabis and cannabis products in the legal market of California are required to be tested for 68 pesticides, four inorganics, 20 solvents, six microbes, and five mycotoxins,” said Leung.

“The cannabis manufacturers must submit their products – including cannabis flowers and cannabis products such as edibles, concentrates, and other consumables – to a state-licensed cannabis testing laboratory. All products must be certified for compliance testing before they can be sold legally. The products that failed the state’s regulatory levels in the compliance testing are subject to recalls.”

The tallied an overall failure rate of 5.1% for the California cannabis samples, which included an average of the failure rate of 2.3% identified for flowers and 9.2% for extracts in California samples. Insecticides and fungicides were the most prevalent categories of detected contaminants, with boscalid and chlorpyrifos being the most common. The contaminant concentrations fell below the regulatory action levels in many legalized jurisdictions, indicating a higher risk of contaminant exposure.

Lastly, Leung’s team reviewed the medical cannabis use reports released by state-level public health agencies from 2016 to 2021.  Currently, there are 37 U.S. medical cannabis programs in and close to a hundred qualifying medical conditions listed by these programs.

“Cannabis and cannabis products are often marketed as alternative options to standard medical treatments,” said Leung. “As such, medical cannabis can potentially expose susceptible patients to harmful contaminants.”

“Immunocompromised patients with cancer and HIV, women of reproductive age, and patients with seizures and epilepsy are among those who are more susceptible to the health hazards of pesticide and microbial contaminants that may be found in cannabis,” added Leung.

The majority of patients were prescribed medical cannabis for use in alleviating pain (799,808 patients), followed by post-traumatic stress disorder (164,383 patients), spasticity associated with multiple sclerosis or spinal cord injury (78,145 patients), cancer (44,318 patients), and epilepsy (21,195 patients).

“Our findings have two important public health implications,” said Leung. “First, the scattershot approach of regulations at the state level can confuse cannabis manufacturers and discourage compliance while subjecting cannabis users to a higher level of contaminant exposure in some jurisdictions. Second, given the current status of cannabis contaminant regulation in the U.S., it is unclear whether the health benefit of cannabis usage outweighs the health risk of exposure to cannabis-borne contaminants.”

To help better inform the public and policy makers, Leung recommends further investigations to examine the safety considerations in susceptible patient populations across all medical conditions.

“The progression and prognosis of many qualifying conditions may be worsened by exposure to detected contaminants in cannabis,” said Leung. “This study demonstrates an urgent need for a unified regulatory approach to mitigate the public health risk of cannabis contamination at a national level.”

4Front Ventures Announces Accretive Acquisition of Massachusetts Based New England Cannabis Corporation 

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ARIZONA:  4Front Ventures Corp., a vertically-integrated, multi-state cannabis operator and retailer, today announced that it has signed definitive agreements on October 6, 2021, to acquire New England Cannabis Corporation (“NECC”), a best-in-class cannabis cultivator, with state-of-the-art facilities based in Holliston, Massachusetts (the “Transaction”). Upon closing, the Transaction is expected to be significantly accretive to the Company’s EBITDA expectations for 2022 and will immediately scale 4Front’s presence as a dominant wholesaler and producer in the State.

Massachusetts’ competitive adult-use cannabis market is rapidly growing and 4Front has already introduced its full suite of popular brands in the State which have achieved wide-scale consumer support. The Company expects the acquisition of NECC to significantly expand 4Front’s strategic position and enable broader market penetration of 4Front’s diverse range of low-cost, high-quality products and brands.

 

    • Expected to add significant accretion to 2022 EBITDA and beyond

    • More than doubles 4Front’s total flower canopy in important limited-license state of Massachusetts

    • Fully operational 55,000 sq. ft. cultivation facility adds scale and depth in the State

    • Cash consideration fully financed following closing of US$15 million convertible note offering led by Navy Capital

    • Closing is subject to approval by the Massachusetts Cannabis Control Commission

As a technological leader within the industry and one of the newest independent cannabis companies in Massachusetts, NECC’s fully operational 55,000 sq. ft. licensed cultivation facility strengthens 4Front’s expanding footprint in this important limited-license state. The Transaction will more than double 4Front’s total flower canopy in Massachusetts to over 30,000 sq. ft, with further expansion potential for up to an additional 10,000 sq. ft. of canopy, and will approximately triple 4Front’s kitchen, processing and distribution space. The NECC facility will supplement the products sold through 4Front’s existing “Mission” dispensaries and further strengthen the Company’s presence in the Massachusetts wholesale market.

“The acquisition of New England Cannabis reinforces our core thesis of bringing scaled, low-cost production and operational depth to attractive, nascent, adult-use cannabis markets” said Leo Gontmakher, Chief Executive Officer of 4Front. “The addition of NECC’s impressive operations will increase our canopy, kitchen capacity, and add to our extraction capabilities overnight, greatly bolstering our position in the Massachusetts market  to become a leading wholesaler of our full suite of products and brands. This acquisition firmly anchors our foothold in the Northeast, and NECC’s state-of-the-art facility will help to drive our growth in the years ahead as we execute on our goal of achieving dominant market share in every geography we operate. I look forward to working with NECC’s seasoned team and leveraging their extensive operational experience as we continue to scale.”

Transaction Terms & Approvals

4Front has entered into agreements to acquire 100% interest of NECC for total consideration of US$55 million. The purchase price will be funded through the issuance to the seller of 25 million subordinate voting shares of the Company (“SVS”) and US$25 million of cash. The cash portion will be funded through proceeds raised from a US$15 million convertible notes offering, led by Navy Capital, a vendor take back note and balance sheet cash.

  • The convertible notes have a maturity date of 36 months following their date of issuance and bear interest at a rate of 6.0% per annum, payable annually.

  • Investors can elect at any time to convert their outstanding balance into SVS at a conversion price equal to US$1.03.

Subject to receipt of regulatory approval and the satisfaction or waiver of customary closing conditions, the Transaction is expected to close in the fourth quarter of 2021.

Fort Capital Partners acted as sole financial advisor to 4Front on the Transaction. Evmarc Advisors acted as financial advisor to NECC on the Transaction.

Cannabis Meets Sports Masterclass & Golf Tournament at ‘Easy Greens’ May 21 & 22 in Arizona

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ARIZONA: Top athletes from across the sports world will assemble in Phoenix, Arizona May 21 & 22, 2021 for Easy Greens, a first-ever “Cannabis meets Sports” – Masterclass & Golf Classic Tournament.

The two day event (May 21 and 22, 2021) is organized by Eugenio Garcia, founder of Cannabis Now Magazine and Playbook Capital – a venture platform at the intersection of entertainment, culture and tech.
The event, sponsored by Fohse, Inc. will host big names including Jay Feely (NFL), Shea Hillenbrand (MLB), Troy O’Leary (MLB), Geoff Jenkins (MLB), Dave Burba (MLB), Gary Matthews Jr. (LB), Jason Thompson (NBA), Augie Ojeda (MLB), Don Buford (MLB), Jacque Jones (MLB), and many more.
Held at Arizona Biltmore Golf Club, a Waldorf Astoria Resort, East Greens will feature speakers, panel presentations, classrooms and networking activities that will highlight investment and growth opportunities specifically for athletes in the $50 billion CBD and THC markets.
Keynote speakers including former NBA star and Viola Brands founder Al Harrington, Mina Mishrikey of Merida Capital and Jared Mirsky, CEO of cannabis branding agency Wick & Mortar are among the highly sought after industry experts in attendance. Additionally, a portion of the golf proceeds will benefit the Educational Sports Institute, a nonprofit organization that provides sports education to children in underserved communities.

Kaycha Labs Announces Next Lab Location in Tempe, Arizona

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FLORIDA: Kaycha Labs, a leader in Cannabis and Hemp testing technologies and methods, has announced that its next lab will be in Tempe, Arizona. With locations in Arizona, California, Colorado, Florida (Fort Lauderdale/Davie and Gainesville), Massachusetts, Nevada, Oklahoma, Oregon, and Tennessee, Kaycha has the most extensive network of Cannabis labs in the United States.

James Horvath, CEO of Kaycha Labs, remarked, “Arizona, having just legalized adult-use, recreational marijuana in November, is the most logical choice for our company’s newest location. In addition to Arizona being a nascent market, many of our current multi-state operator clients have invested heavily in the state and we know they value reliable testing partners who can provide consistent testing methodologies across geographies.”

John Schwartz, Kaycha Labs’ Chief Operating Officer, added, “The 6,000-square-foot Tempe space comes with a pre-existing, efficient layout that will allow us to build-out quickly and accommodate several sets of equipment. We have already hired our lab director, construction contracts have been signed, and because we are experienced in the ISO certification process, we expect to be operational this fall after we complete the regulatory process. Needless to say, we are very excited.”

Arizona: Special Meeting of the Mayor and City Council on November 10, 2020 to Discuss Proposition 207

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The Willcox City Council will meet to discuss and direct marijuana ordinance following the passing of Proposition 207.

ARIZONA: Arizona residents voted on November 3rd, 2020 to pass Proposition 207, which legalized the possession and use of recreational marijuana for adults (age 21 years or older) in Arizona. Individuals were permitted to possess no more than one ounce of marijuana and grow up to six marijuana plants in their residences. The legislation also allowed any person convicted of certain crimes related to marijuana possession, consumption, and transportation to petition for the expungement of their criminal record starting on July 12, 2021.

Prop. 207 placed a 16 percent tax on marijuana sales, in addition to the existing transaction privilege tax and use tax. Revenue from the tax was divided between public programs such as community college districts, infrastructure, public safety, and public health organizations.

Through this legislation, local governments have the ability to ban marijuana facilities and testing centers and can control of aspects of licensing, regulation, and zoning.

The community is invited to attend the meeting on Tuesday, November 10th, at 3:30 PM in the City Council Chambers located at 300 W Rex Allen Drive, Willcox, AZ 85643.

Harvest Health & Recreation Acquires Only Licensed Dispensary In Casa Grande, Arizona

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ARIZONA: –Harvest Health & Recreation, a vertically integrated cannabis company with one of the largest and deepest footprints in the U.S., announced today the acquisition of Arizona medicinal cannabis dispensary Leaf Life in a transaction that includes the only cannabis dispensary in Casa Grande. Leaf Life will be transitioned to operate under Harvest’s House of Cannabis stores, known for top operational standards, best-in-class experiences and products and expert teams in developing trusted, quality-driven retail stores with a focus on bettering the community.

“Arizona is the third largest medicinal cannabis market in the United States, yet too many in our communities still do not have adequate access to dispensaries that offer the high-quality medicinal products and expert staff required to improve patient education and treatment outcomes,” said Harvest Executive Chairman Jason Vedadi. “Harvest is committed to ensuring the strongest operational standards for our industry on a national scale, and we are particularly proud of this acquisition in our home state of Arizona because it enables us to further improve patient access to high-quality medicinal cannabis products.”

“We chose to structure a sale with Harvest because we believe in their commitment to Arizona and their future success,” said Ricky Hendrickson, Leaf Life’s Vice-President . “As a testament to that belief we have agreed to a two-year lockup on the stock portion of our agreement and are confident we’ll be part of the Harvest family for the long-term.”

Arizona continues to be a priority market for Harvest with large scale growth projections this year. This transaction will expand Harvest’s industry leading position on operating licensing rights to include more than 210 retail and processing facilities in 17 states and territories across the U.S. Most recently in Arizona, Harvest opened Glendale’s first medical dispensary, and announced a six license acquisition from Devine Hunter, Inc. Harvest now has rights to operate up to 18 dispensaries and cultivation/processing facilities in the state, strengthening their leadership position as the largest operator in the market.

 

 

Arizona: Federal Judge Rules Medical Cannabis Patient’s Firing Violated State Law

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MJLegalThe case is Whitmire v. Walmart Stores Incorporated

ARIZONA: A private employer acted improperly when it fired a state-registered medical cannabis patient for failing a urinalysis drug screen, a federal judge ruled last week.

United States District Judge James A. Teilborg opined that Walmart violated Arizona law by terminating an employee solely for testing positive for the presence of THC metabolites in her urine. The carboxy-THC metabolite is an inert breakdown product of THC which may remain present in urine for weeks or even months following cannabis exposure.

Under Arizona’s voter-initiated medical cannabis access law, an employer may not discriminate in hiring or firing based solely upon a patient’s “positive drug test for marijuana components or metabolites, unless the patient used, possessed or was impaired by marijuana on the premises of the place of employment or during the hours of employment.”

According to the US Department of Justice, urinalysis tests “detect drug use but not drug impairment. A positive test result … does not indicate abuse or addiction, recency, frequency, or amount of use, or impairment.”

In recent years, judges have similarly upheld patient protections in other jurisdictions, including Connecticut, Massachusetts, and Rhode Island.

The case is Whitmire v. Walmart Stores Incorporated.

cFor more information, contact Keith Stroup, NORML Legal Counsel, at (202) 483-5500.

 

Harvest Health & Recreation Acquires Six Additional Licenses In Home State of Arizona

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ARIZONA: Harvest Health & Recreation Inc, a vertically integrated public cannabis company with one of the largest footprints in the U.S., has entered into a binding agreement providing for it to acquire six additional licenses in Arizona. Upon closing, Harvest Health & Recreation Inc. (Harvest) will control 16 licenses throughout its home state of Arizona, the country’s third largest cannabis market. Before this transaction, Harvest was already the largest operator in Arizona.

“Arizona is a logical place for us to continue to grow for a variety of reasons,” said Harvest Executive Chairman Jason Vedadi. “We have already acquired locations for the future stores and look forward developing dominant footprints in a number of states. Arizona is one of them; it’s a great market with significant upside.”

With 16 vertically integrated licenses, 11 open dispensaries, two cultivation facilities and one processing facility upon closing, Harvest expands what is already the largest footprint in Arizona. Harvest’s agreement is with Devine Hunter, Inc., formerly the state’s second-largest license holder, for an undisclosed amount of cash, stock and other consideration. With the closing of this transaction, Harvest controls licenses for 86 dispensaries, 23 cultivation facilities, and 22 processing facilities across the country.