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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.

Cresco Labs Announces Fourth Quarter & Full Year 2022 Results

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Annual revenues grew 3% year-over-year and maintained leadership in branded product sales

Company laser-focused on profitable core to further strengthen balance sheet

ILLINOIS: Cresco Labs Inc., a vertically integrated, multi-state operator and the No. 1 producer of branded cannabis products in the industry, today released its financial results for the quarter and year ended December 31, 2022. All financial information presented in this release is reported in accordance with U.S. Generally Accepted Accounting Principles (“U.S. GAAP”) and in U.S. dollars, unless as otherwise indicated.

Fiscal Year 2022 Financial Highlights

  • Record revenue of $843 million, an increase of 3% year-over-year; excluding California distribution operations exited in 2021, adjusted revenues grew 6% year-over-year.
  • Record branded unit volume of 61 million, up 37% year-over-year2.
  • Record retail transactions of 4.6 million, up 15% year-over-year.
  • Adjusted gross profit1 of $418 million, or 50% of revenue.
  • Adjusted EBITDA1 of $174 million, or 21% of revenue.
  • Net loss of $215 million for the full year included $141 million of one-time impairment charges.
  • Generated positive operating cash flow of $19 million for the full year and ended the year with $122 million of cash, cash equivalents and restricted cash.
  • Retained the #1 market share position in Illinois and Pennsylvania and achieved #1 share in Massachusetts. The Company had the #1 best-selling branded portfolio of cannabis products in the industry, the #1 portfolio of branded flower and branded concentrates, and the #3 portfolio of branded vapes2.

Fourth Quarter 2022 Financial Highlights

  • Fourth quarter revenue of $200 million, down 8% year-over-year.
  • Branded unit volume of 17 million, up 24% year-over-year2.
  • Retail transactions of 1.2 million, up 4% year-over-over.
  • Growth from increased unit sales and retail transactions was offset by price compression across the industry.
  • Adjusted gross profit1 of $90 million, or 45% of revenue.
  • Fourth quarter adjusted EBITDA1 of $31 million, or 15% of revenue.
  • Adjusted gross profit margin and adjusted EBITDA margin were impacted by approximately $10 million of non-cash, non-recurring items, including charges related to revaluation of inventories to the net realizable value, causing an approximate 500 bps drag on margins in the quarter. Normalized for these adjustments, adjusted gross margin would have been 50% and adjusted EBITDA margin would have been 20%.
  • Fourth quarter net loss of $180 million included $141 million of impairment charges.
  • Generated positive operating cash flow of $4 million.

Management Commentary

“I want to congratulate the Cresco Labs team on how well they tackled the challenges of 2022. Despite the headwinds, the Cresco team generated a record $843 million of sales, a record 61 million branded units sold (+37% year-over-year), and a record 4.6 million retail transactions (+15% year-over-year). Our relentless focus on providing the highest perceived value to the consumer led Cresco Labs to have the number one most sold branded product portfolio in the U.S. for the second straight year. Cannabis made progress on its path to becoming one of the largest consumer product categories in the country. The limited legal cannabis industry reached over $25 billion2 in revenue and produced almost $4 billion in state tax revenue. The current estimated regulated-plus-illicit cannabis market in the U.S. is nearly the size of the U.S. beer industry. From our front-line position, we were disappointed that federal reform did not pass late last year, but last year’s efforts have led to strong momentum for change with the new Congress. None of the challenges of 2022 change the long-term thesis and opportunity that is cannabis,” said Charles Bachtell, CEO and Co-founder of Cresco Labs.

“As we look toward the months ahead, we don’t expect the operating environment to get any easier, but our priorities are clear. We’re laser-focused on our profitable Core—core capabilities, core products, and core brands. What you can expect from us is continued leadership in branded cannabis, rationalization and optimization of our footprint, expansion in the reach and efficiencies of our retail business, generation of more free cash flow, and the strengthening of our balance sheet, while we continue to lead on federal reform,” added Bachtell.

Balance Sheet, Liquidity and Other Financial Information

  • As of December 31, 2022, current assets were $327 million, including cash, cash equivalents and restricted cash of $122 million. The Company had working capital of $46 million and senior secured term loan debt, net of discount and issuance costs, of $381 million.
  • Total shares on a fully converted basis were 437,468,399 as of December 31, 2022.
  • During the fourth quarter, the Company took an impairment charge totaling $141 million, primarily related to its plan to exit certain California operations.

Social Equity and Education Development Program

  • In the fourth quarter, the Illinois Cannabis Education Center (“ICEC”) continued programming in partnership with local colleges, community, and business organizations. At the close of the fourth quarter, eight colleges and eight entrepreneurship training organizations have continued to utilize the space and have served over 500 individuals and 50 ancillary cannabis businesses. Through the ICEC, students, entrepreneurs, and working individuals receive hands-on training focused on compliance, security, technology, and daily operations in a dispensary to understand all aspects of cannabis retail.
  • Throughout 2022, SEED hosted more than 25 workshops and educational seminars which have served over 2,500 attendees nationwide.
  • The Company provided more than 1,000 hours of one-on-one pro bono business consulting to social equity licensees and ancillary business owners.

Capital Markets and M&A Activity

  • The Company and Columbia Care mutually agreed to extend the outside date to complete their previously announced transaction to June 30, 2023.
  • The regulatory approval process is on-going, and the Company is working toward final agreements to sell the remaining assets required to be divested.

Conference Call and Webcast

The Company will host a conference call and webcast to discuss its financial results on Thursday, March 16, 2023, at 8:30am Eastern Time (7:30am Central Time). The conference call may be accessed via webcast or by dialing 1-833-470-1428 (US Toll Free), 1-404-975-4839 (US Local), or +1 929-526-1599 (Other) providing access code 759131. Archived access to the webcast will be available for one year on Cresco Labs’ investor relations website.

Consolidated Financial Statements

The financial information reported in this press release is based on unaudited management prepared financial statements for the three months and year ended December 31, 2022. These financial statements have been prepared in accordance with U.S. GAAP. This release contains certain preliminary financial results for the three months and year ended December 31, 2022. These preliminary results for the three months and year ended December 31, 2022, are provided prior to completion of all internal reviews and external audit procedures and are therefore subject to adjustment until the filing of the Company’s audited consolidated financial statements, which the Company expects to file on SEDAR during the week of March 20, 2023. The audit of the consolidated financial statements for the year ended December 31, 2022, is currently in process. All financial information contained in this press release is qualified in its entirety with reference to such financial statements. While the Company does not expect there to be any material changes between the information contained in this press release and the consolidated financial statements it files on SEDAR, to the extent that the financial information contained in this press release is inconsistent with the information contained in the Company’s financial statements, the financial information contained in this press release shall be deemed to be modified or superseded by the Company’s filed financial statements. The making of a modifying or superseding statement shall not be deemed an admission for any purposes that the modified or superseded statement, when made, constituted a misrepresentation for purposes of applicable securities laws.

Cresco Labs references certain non-GAAP financial measures throughout this press release, which may not be comparable to similar measures presented by other issuers. Please see the “Non-GAAP Financial Measures” section below for more detailed information.

Non-GAAP Financial Measures

Earnings before interest, taxes, depreciation, and amortization (“EBITDA”), Adjusted EBITDA and Adjusted gross profit are non-GAAP financial measures and do not have standardized definitions under U.S. GAAP. The Company has provided the non-GAAP financial measures, which are not calculated or presented in accordance with U.S. GAAP, as supplemental information and in addition to the financial measures that are calculated and presented in accordance with U.S. GAAP and may not be comparable to similar measures presented by other issuers. These supplemental non-GAAP financial measures are presented because management has evaluated the financial results both including and excluding the adjusted items and believe that the supplemental non-GAAP financial measures presented provide additional perspective and insights when analyzing the core operating performance of the business. These supplemental non-GAAP financial measures should not be considered superior to, as a substitute for or as an alternative to, and should only be considered in conjunction with, the U.S. GAAP financial measures presented herein. Accordingly, the Company has included below reconciliations of the supplemental non-GAAP financial measures to the most directly comparable financial measures calculated and presented in accordance with U.S. GAAP.

Ohio Board of Pharmacy Awards Dispensary Certificate of Operation in Harpster

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OHIO: The State of Ohio Board of Pharmacy today awarded a Dispensary Certificate of Operation to Ohio Cannabis Company, located at 17043 County Highway 113, Harpster.  The Board has now issued 68 Dispensary Certificates of Operation.

The interactive map of Dispensaries with Certificates of Operation will be updated within two business days.

Green Dragon Adds Six Additional Medical Cannabis Dispensaries in Florida and Launches Flower from New Grow

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FLORIDA: Green Dragon, a subsidiary of multi-state cannabis operator Eaze Technologies Inc., announced the opening of six new Florida medical cannabis dispensaries in Jacksonville, St. Petersburg, Madison, South Pasadena, Orange City, and Orlando. Green Dragon will have 28 medical marijuana dispensaries across the state, continuing its expansion in the Florida market with the goal of opening 50 locations by the end of the year.

Green Dragon’s new stores coincide with the launch of its new flower with an expanded strain variety from the first harvest at its state-of-the-art cultivation facility in Palatka.

The vertically integrated company now offers a full assortment of premium cannabis products, including flower, vape cartridges, concentrates, tinctures, and tablets.

Cory Azzalino, Chief Executive Officer of Eaze and Green Dragon, said, “We are excited to open six new locations alongside the release of our new, high potency strains, which are bestsellers in Colorado. Our new products represent the best value for indoor flower in the Florida market, which, paired with our 28 locations, provides unparalleled access to fairly priced high-quality products. We are also releasing our highly anticipated 1G vaporizers, gummy edibles, pills, and lotion.”

Green Dragon’s new locations offer promotions, rewards programs, new patient offers, and senior, pediatric, veteran, and industry discounts to Florida patients. Addresses for each dispensary are as follows:

Jacksonville- 6352-3 103rd Street, Jacksonville, FL 32210
St Petersburg- 130 Fountain Parkway, St. Petersburg, FL 33716
Madison- 855 Base Street, Madison, FL 32340
Pasadena- 1271 Pasadena Ave S, South Pasadena, FL 33707
Orange City- 2590 S Volusia Avenue, Orange City, FL 32763
Orlando – 800 Lee Road, Orlando, FL 32810

For additional information, visit greendragonfl.com.

Burns & Levinson Represents Teneo Funds in Successful Resolution of First Ever Receivership of a Cannabis Company in Massachusetts

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Multi-state cannabis operator MariMed Inc. completes acquisition of Quincy, MA-based medical cannabis operator Ermont, Inc.

MASSACHUSETTS: Burns & Levinson successfully steered the resolution of the first ever receivership of a cannabis company in Massachusetts through its representation of Teneo Funds SPVi LLC, the debt holder for Quincy, MA-based medical cannabis operator Ermont, Inc. Multi-state cannabis operator MariMed Inc. completed the acquisition of the operating assets of Ermont on March 9, 2023. The acquisition required approvals by the MA Superior Court, the Massachusetts Cannabis Control Commission, and the city of Quincy, which permitted the assignment of two Host Community Agreements in Quincy to MariMed.

In 2021, Burns & Levinson and Teneo Funds petitioned the Massachusetts Superior Court to appoint a Receiver to take control of Ermont’s assets on account of a default of a $22 million plus obligation under a secured loan agreement. As part of its strategy to seek the first-ever cannabis company receivership in Massachusetts, Burns & Levinson worked collaboratively with the Massachusetts Cannabis Control Commission – providing input on the development of the new regulations on receiverships and secured party rights, and working to obtain pre-approval of a receiver – before presenting it to the court for approval. The court approved the appointment of a receiver by order dated November 22, 2021, after which time, the receiver commenced a process to sell all of Ermont’s assets to a third party. On October 13, 2022, the Superior Court approved the sale of substantially all of Ermont’s assets to MariMed.

The Burns & Levinson team was led by partner Frank A. Segall, who chairs the firm’s Cannabis Business & Law Advisory Group and Business Law Group, and partner Scott Moskol, who co-chairs the Cannabis Business & Law Advisory Group and Financial Restructuring & Distressed Transactions Group. Both are nationally-known cannabis law experts, each with over 30 years of experience in restructurings, workouts, bankruptcies, receiverships, and other insolvency-related matters.

“The work we did with Teneo Funds was not only a major win for our client, but for the entire cannabis industry, which needs the ability to solve growing insolvency problems without the benefit of bankruptcy protections. Unfortunately, we are going to continue to see more and more of these distressed situations in the cannabis market as operators confront the current realities of market saturation, lack of capital, over leveraging, growing expenditures, and onerous taxation. Whether it’s for an operator facing economic difficulties, a secured lender like Teneo who is looking to protect its investment or an opportunistic investor looking for special situation in the cannabis industry, we can help our clients find novel solutions,” said Segall.

“We are at the forefront of cannabis restructuring, and are highly skilled at navigating never-before-seen situations where experience and knowledge is key to moving forward. While receivership of a cannabis company is still a new idea, we have already seen others using our strategy as a model, and we look forward to helping others navigate this emerging area of the law,” added Moskol. Burns & Levinson was the first major Boston corporate law firm to develop a national cannabis business practice, and has been advising cannabis businesses, entrepreneurs and investors across the country for nearly a decade. The firm has unrivaled experience in cannabis and hemp/CBD business formation and corporate structuring, private placements, venture capital, M&A, securities, banking issues, fund formation, debt and equity financing, restructuring and receiverships, real estate acquisitions and leasing, intellectual property protection, 280E taxation issues, and cannabis litigation. The firm is well-known for its role in the cannabis banking industry and is among the top law firms in the country handling M&A and high-level corporate and financing deals in the private and public markets in the cannabis market.

 

Mary Jones Cannabis Sodas & Edibles Expanding to Michigan and Nevada

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Jones Soda’s Cannabis Brand Continues National Rollout Following Strong Performance in California

WASHINGTON: Jones Soda Co., the original craft soda known for its unconventional flavors and user-submitted photo labels, today announced an agreement expanding distribution of its new Mary Jones cannabis-infused beverage brand to both Michigan and Nevada, the fourth and eighth largest cannabis markets in the U.S., respectively. The Mary Jones line debuted last June in California and is slated to launch in Washington State in Q2, continuing a planned national rollout to all recreational use markets.Mary Jones Logo

Mary Jones already ranks as the #1 seller in the cannabis-infused carbonated beverage category in California, where it is carried in more than 275 dispensaries. Retail adoption has been so rapid, fueled by Jones Soda’s reputation for flavor innovation and iconoclastic brand persona, that Mary Jones has become the fastest new cannabis brand launch in the state.

Mary Jones manufacturing and distribution in Michigan and Nevada will be handled by Maxxx Labs, a cannabis contract manufacturing and distribution company specializing in beverage manufacturing. The company operates licensed cannabis manufacturing facilities in both states as well as licensed dispensaries in Michigan, with planned expansion into the Ohio, Florida and Texas markets.

The new agreement brings Mary Jones into two states that are currently expanding their cannabis footprints. Michigan voters legalized adult-use cannabis in 2018, has more than 1,050 cannabis sales locations throughout the state, and is set to open the first Detroit dispensaries this year following the recent award of 33 licenses out of the 160 permitted under the city’s recreational cannabis ordinance. Nevada legalized recreational cannabis use in 2017, now ranks second in the nation in cannabis sales per capita, and is slated to distribute licenses this year for cannabis consumption lounges that are expected to create a marijuana zone in Las Vegas.

Mary Jones will launch in both states this summer with the full portfolio of current products, including Mary Jones 10mg and 100mg THC-infused sodas and THC-infused syrups. Michigan and Nevada will join California and Washington in the launch of Mary Jones edibles in multiple flavors and formats, also this summer. All products will be available in a variety of flavors that taste exactly like the mainline Jones craft sodas that have been top sellers for over 25 years. Limited-edition flavors will be added seasonally.

The brand’s 10mg sodas are packaged in single-serving 12 oz glass bottles sold in 4-pack carriers. The 100mg sodas come in 16 oz resealable, child-resistant, multi-serve cans designed for paced consumption and/or social sharing with friends. The syrups come in 4 fl glass bottles containing 100mg of THC for multiple servings that can be added to any soda, used as a cocktail mixer, sipped straight from the bottle, drizzled over desserts, or used to infuse favorite recipes.

“As the first branded soda company to expand into the cannabis space, we have unique advantages that include 26 years of brand recognition, deep flavor science expertise, and an edgy brand personality that’s a perfect fit for the canna culture,” said Mark Murray, President and CEO of Jones Soda Company. “These attributes have already helped turn Mary Jones into California’s top infused carbonated beverage and the state’s fastest-growing cannabis brand, and we fully expect similar success in Washington, Michigan, Nevada and every other market we enter.”

“This collaboration presents a unique opportunity to combine our expertise in cannabis manufacturing with Jones Soda’s well-known creativity in beverage development,” said Paul Schmitz, CEO of Core Investment Group, the parent company of Maxxx Labs. “We will be bringing canna consumers in Michigan and Nevada new products that I fully expect to fly off the shelves and continue building Mary Jones into a leading brand in the space.”

“This launch is special for us. Our Michigan Jones Soda fans are passionate about the brand and their favorite flavors. They’ve been ready for this launch right alongside us and we know they will love these products,” said Bohb Blair, CMO of Jones Soda & CBO of Mary Jones. “Nevada is unique, with a hometown group of consumers matched by a large tourist population. We want each of them to have a great Mary Jones experience to talk about when they get home.”

The first Michigan and Nevada dispensaries to carry Mary Jones products will be announced on the ‘Where To Buy’ page at www.gomaryjones.com shortly before launch.

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.”

WSLCB Cannabis Canopy Enforcement and Education Update

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WASHINGTON: In November 2021, LCB communicated the Enforcement and Education Division’s protocol related to cannabis canopy enforcement. The protocol was designed to ensure consistent application of cannabis canopy rules described in WAC 314-55-075.

In August 2022, based on stakeholder concern about the protocol, LCB paused canopy enforcement prioritization, and opened rulemaking to explore whether revisions were needed to WAC 314-55-075. To better understand stakeholder perspective and inform potential rule development, the agency hosted two inclusive and interactive engagement opportunities in October and November 2022.

During the sessions, licensees, industry representatives and members of the public gathered to share thinking around potential rule revisions. Themes emerged that included policy options exceeding the scope of rulemaking, such as deconstruction of the tier system and engaging in individual plant counts, to a weight-based system. However, most participants were interested in consistent application of WAC 314-55-075 in practice rather than rule revision.

To support regulatory stability, the LCB Enforcement and Education Division and Director’s Office are working together to draft an interpretive statement designed to support consistent application of WAC 314-55-075 that supports the Enforcement and Education division’s cannabis canopy protocol. The agency anticipates withdrawing rulemaking related to WAC 314-55-075 during the Board’s regularly scheduled meeting on March 15. An interpretive statement will be issued and filed with the Reviser’s Office on or about April 7, 2023. Prioritization of canopy rule enforcement will resume at that time.

Heavy Metal Entertainment & Berkshire Roots to Launch One-of-a-Kind Cannabis Products Line in Massachusetts

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Will Debut at NECANN Boston, March 10-12

MASSACHUSETTS and NEW YORK: Berkshire Roots and Heavy Metal Entertainment today announced a partnership in which Berkshire Roots will offer new flower strains and create unique cannabis products branded “Heavy Metal” to coincide with HMEs plans to deliver edgy and exciting new media and experiences for its fanbase and to attract new people to its rich history of stories and characters.  The cannabis product line will be introduced to the public at the NECANN Boston trade show at the Hynes Auditorium at the Berkshire Roots booth. The announcement was made by James Winokur, CEO of Berkshire Roots, with Heavy Metal Studios President Tommy Coriale attending NECANN and speaking on behalf of Heavy Metal Entertainment.

HME has been on the forefront of bringing counterculture to the mainstream through adult-oriented science fiction, fantasy, and horror entertainment since its founding in 1977.  The new ownership group is focused on a 360-degree fan experience unlike any other in entertainment, delivering unrivaled content across print publishing, new media, and a newly launched TV, Film, and animation focused content studio.  Tying in Heavy Metal’s boundary pushing DNA and world class art and storytelling to great cannabis products will deliver a level of customer experience never before seen in either the entertainment or cannabis industries.

According to CEO James Winokur, “Building on the reputation and consumer loyalty Berkshire Roots has established since it launched, we are now in a position to guide other brands that want to enter the cannabis market and Massachusetts specifically.  We want to work with unique offerings that set themselves apart in a crowded field.  When I first started thinking about the Heavy Metal brand and how creative we could get in our product offerings, I became really passionate about working with the HME team.  I think this model is game-changing for the industry, and I can’t think of another partnership like this in the cannabis space. Our customers are going to really love this pairing!”

“When we were all introduced to Berkshire Roots, we immediately gravitated to the idea of a connection between our brand and cannabis,” offered Coriale. “As conversations with company management went on and Heavy Metal got a glimpse of their follow-up product ideas, we grew increasingly excited as they really understood the DNA of the brand and its commitment to enhancing our customer experience in unexpected ways. We can’t wait to see this product connect to both the long-time fans, and the younger generation who are just getting to know Heavy Metal for the first time.”

Heavy Metal was founded as a print publication that uniquely blended comic book-style stories with adult-themed subjects and characters no other publisher had been able to achieve in those early days. Shortly thereafter, Heavy Metal and legendary Producer/Director Ivan Reitman (Ghostbusters, Stripes, Twins) released the groundbreaking 1981 film that brought the magazine to life and introduced adult animation as we know it today to the masses. There is a broad range of history and influence to draw on for this partnership, along with today’s brand-new artists and writers who are also developing new story arcs and characters which will play in emerging digital spaces with art, NFTs, AR/VR, and more.

Berkshire Roots, based in Pittsfield, MA, is a leading cultivator, manufacturer and dispensary operator well known for its own highly awarded products. Berkshire Roots dispensaries are located at 501 Dalton Avenue, Pittsfield, MA and 253 Meridian Street, East Boston, MA The Heavy Metal products will be available simultaneously at the beginning of April with a select group of retailers throughout the state, including Budzee Delivery, Dreamer, The Goods, Honey, Nature’s Remedy, Northeast Alternatives, Nova Farms, Panacea Wellness and Zyp Run Delivery.

 

Women’s History Month: Honoring Women’s Impact on the Cannabis Industry

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By Kerri Accardi, 420MEDIA

As we celebrate Women’s History Month, it’s important to recognize the incredible contributions of women in the cannabis industry. While it’s no secret that the industry has traditionally been male-dominated, women have been breaking barriers and paving the way for others to follow.

One way to learn more about the amazing women in cannabis is by tuning in to “Chronicles of Women in Cannabis,” a video series streaming on CANNECTED TV and produced by 420MEDIA. The series highlights the journeys of women in the industry and sheds light on the challenges they’ve faced, the successes they’ve achieved, and the lessons they’ve learned along the way.

With 50 stories currently streaming and more coming out this month, there’s no shortage of inspiration to be found. For example, there’s Mara Gordon, the Co-Founder of Aunt Zelda’s™, Zelira Therapeutics, and Octopi Wellness™, who specializes in developing data-driven cannabis treatment protocols for seriously ill patients. There’s also Dr. Bridget Williams, an established board-certified family physician and the CEO of Green Harvest Health, who combines her medical background with certifications in life and cannabis coaching to provide valuable “medical motivational talks” on medical cannabis, CBD, life balance, and confidence.

Stacey Theis, the founder of the Canna Sense Campaign and a board member of Freedom Grow, is another incredible woman in cannabis who has been working to educate communities, support patients, and advocate for the freedom of those incarcerated for cannabis offenses. And let’s not forget about Barbara Laronde, a Cannabis Patient Community Activist and Educator, Cannabis Journalist, Cannabis Cultivator, Cannabis Consultant, Cannabis Industry Leader, and Cannabis Business Owner who is planning an exciting event on 4/20 in the US Virgin Islands.

As we celebrate Women’s History Month, let’s take the time to acknowledge and honor the countless women who have made an impact in our society, including those in the cannabis industry. Let’s also continue to support and elevate women by amplifying their voices and stories. So, grab some popcorn, tune in to “Chronicles of Women in Cannabis,” and join the celebration of women’s history and their contributions to the world of cannabis.

If you’re a woman in the industry and want to share your story, submissions have reopened, and more information is available at 420MEDIA.US/herstory. This Women’s History Month, let’s continue to elevate and celebrate the incredible women in cannabis who are making a difference every day.