MjLink Cannabis Business News and Press
MARSHALL,Mich., Dec. 20, 2021 – PRESS RELEASE – Common Citizen, which produces safe, high-quality cannabis products for patients andadult-use customers, announced the launch of its Principle product line, which is nowavailable at its retail stores. All net proceeds from Principle sales go backinto the communities Common Citizen proudly serves.
Principlecannabis is now available in a single, 1-gram pre-roll in a decorative tin atCommon Citizen’s retail locations.
“OurPrinciple product line embodies our priority of people over product, andarrives just in time for the holidays to help our ongoing efforts to reinvestin the diverse communities we proudly call home,” Common Citizen CEO Michael Eliassaid. “The Principle project also helps us educate the common citizen about themany wellness benefits of cannabis and helps achieve our goal of eliminatingstigma around its production, distribution and consumption.”
Principlewas unveiled at a recent two-day media event, which included a tour of CommonCitizen’s state-of-the-art hybrid greenhouse in Marshall and the company’sflagship retail location in Flint. The event included dignitaries and membersof the national media and culminated in the launch of the film “Cannabis For Humanity” in Detroit.The film embodies Common Citizen’s mission to serve the unique cannabis needsof patients and adult-use customers across Michigan. A public release date forthe film will soon be announced.
Watcha preview of the film here.
Creatingtangible impact through cannabis ventures requires action, sustained engagementand collaboration with partners already doing transformative work to achievethis goal. To help advance these efforts, Common Citizen has partnered withCannaclusive to better serve its employees and local communities. In the comingmonths, Cannaclusive will help Common Citizen direct its profits toorganizations dedicated to creating meaningful opportunities for marginalizedcommunities.
Eindhoven, the Netherlands, PRESS RELEASE – Signify today announced that it has entered into a definitive agreement with ams OSRAM to acquire Austin, Texas-based Fluence for USD $272 million (EUR 242 million) on a cash and debt-free basis. This acquisition will strengthen our global Agriculture lighting growth platform and extend our position in the attractive North American horticultural lighting market.
The acquisition is fully in line with our strategy to expand in attractive growth segments and our commitment to improving food availability by providing growers with horticultural lighting that helps them to reduce resource consumption and increase yields. We expect the global market for agricultural lighting to grow by more than 20% per year to EUR 1.6 billion in 2024.
The acquisition will add Fluence’s complementary horticultural lighting technology to our existing knowledge and expertise. This includes light recipes for the legal growing of cannabis1 - which, due to the legalization in Canada and many US states in recent years, currently generates the majority of Fluence’s sales – and light recipes for the company’s fast-growing business to grow other crops. Fluence’s technology also includes more than 140 issued and pending patents, focusing on areas such as light quality, thermal management and installation methods. Currently Fluence generates a majority of its sales in North America.
“We’re excited to announce that we’re acquiring Fluence, strengthening our agricultural lighting business, one of our main growth platforms. It also further underlines the strategic importance of the North American market to our business,” said Harsh Chitale, Division Leader Digital Solutions at Signify. “We’re looking forward to welcoming the team from Fluence. Its lighting innovations and solid go-to-market strategy have helped build a recognized brand with a strong position in North America and a fast-growing business in Europe. We feel that now is the right moment to join forces, allowing both of us to serve more customers with high-quality horticulture lighting products.”
“Since Fluence’s founding, it has been our sole mission to improve the interaction between light and life to yield a healthier and more sustainable world. Adding our lighting solutions to Signify’s strong portfolio empowers our combined businesses to deliver the world’s most advanced horticulture technology to cultivators on a global scale,” said David Cohen, CEO of Fluence. “The combination of our companies will immediately expand our collective footprints and inject valuable expertise into both companies’ product innovations. We look forward to uniting with the Signify team.”
Fluence employs more than 200 people. In the trailing 12 months (October 2020 to September 2021), Fluence generated USD 141 million (EUR 124 million) in revenue. Fluence will operate as an entity within Signify’s agricultural lighting business in Division Digital Solutions.
2021 was another year of growth, but also uncertainty, for the rapidly expanding cannabis industry.
For Jonathan Havens, co-chair of Saul Ewing Arnstein & Lehr’s Cannabis Law Practice and chair of the firm’s Food, Beverage and Agribusiness Practice, and Marc Adesso, partner of Saul Ewing’s Cannabis Law and Corporate practices, there are several key developments from 2021 that will impact the industry’s outlook in 2022.
Here, they share their predictions.
1. Federal policy reform has stalled.
While this year saw cannabis policy reform efforts gain momentum at the federal level, Havens said there was “no real advancement,” even for incremental reform like the Secure and Fair Enforcement (SAFE) Banking Act.
That piece of legislation, which would allow banks to provide services to the federally illegal cannabis industry, cleared the House for the first time in 2019, and twice in 2020 as part of two separate COVID-19 relief bills. This year, the House passed the SAFE Banking Act for the fourth time in April before approving it a fifth time as an amendment to the National Defense Authorization Act (NDAA) in September.
Entry into today’s cannabis space is rife with obstacles posed by states with opaque licensing awarding procedures, caps on entry, as well as other challenges set in motion by local governments (and local officials) seeking bounty of all sorts for the privilege of operating a business within the city, town or county’s physical boundaries.
In the last few years, we’ve seen lawmakers pass imperfect laws that intentionally or negligently include loopholes that undermine a law’s stated purpose and that can be contorted—for example, to benefit multi-state operators over social equity beneficiaries. Government officials (often behind closed doors) sometimes steer their associates, friends, or those to whom they have ties to the prizes of cannabis licenses, zoning allowances, and/or amenable community host agreement buy-ins. It feels to many that the deck is rigged. Grumbling does little because unless confronted by lawyers or litigation (of the criminal or civil litigation kind), those involved typically deny any impropriety.
As a result, civil lawsuits against states and localities are becoming commonplace. Consider the flurry of civil litigation in Illinois against the way it awards licenses, or the December 2021 lawsuit filed against the city of Gloucester, Mass., sued by a cannabis operator for charging almost $500,000 as a “community impact fee” above the state’s statutory limit for a cannabis company seeking to operate in that bucolic seaside city. The cannabis business operator’s lawyers there allege that the fees, excess taxes, and charitable giveaways are in no way reasonably related to the costs incurred by the municipality to permit the business to operate in the city. The cannabis company lawyers are also asking the court to bar the city from assessing such fees and have even asked the court to order the city to refund some of the money already paid.
The lawsuit is indicative of those broader trends within the regulated cannabis space.
The Arizona Department of Health Services (ADHS) has its work cut out after more than 1,500 adult-use cannabis applications were filed ahead of Tuesday’s deadline for the state’s 26 social equity retail licenses.
The licenses are tied to applicants who have recently lived in 87 qualifying ZIP codes, ADHS officials announced in October.
While ADHS officials did not release details about their residency requirement selection process—there are more than 500 ZIP codes in the state—the chosen areas appear heavily focused on or near Native American reservations, The Arizona Republic reported.
The 26 licenses are in adherence to Proposition 207, the adult-use cannabis ballot measure Arizona voters passed in the 2020 election, establishing that those licenses be awarded to applicants impacted by prohibition.
A limited license state, Arizona’s adult-use cannabis program allows for a total of 169 retail licenses. To be eligible for the 26 social equity licenses, applicants must meet three of four qualifying criteria, including the residency requirement, set forth by the ADHS.
Live resins separate themselves from other concentrated cannabis products by their higher terpene contents. These products offer consumers an experience closer to smoking flower compared to distillates, which have been stripped of most of their natural terpenes and aromatic compounds during the drying, curing, and/or extraction process—although they often are reinfused with flavor to improve user experience.
Live resins are produced by flash-freezing cannabis flower before the drying and curing stage—this preserves the volatile terpenes and other essential oils found in the biomass. Extractors then process that frozen material, ensuring they capture any and all terpenes during the decarboxylation stage, and reintroduce the original terpenes into the extracted cannabinoid mix. These products can then be filled into vape cartridges and other vaporizers, or “dabbed” on glass water pipes.
These high-terpene products are hitting all-time highs in sales and are growing at a faster rate than other concentrate categories, according to data from Headset.
“Live Resin” total sales in California, Colorado, Michigan, Nevada, Oregon, and Washington from January through November grew by 29% from $255 million in 2020 to $329 million in 2021. This was more than double the growth rate of the total “Concentrate” category, which increased in sales by 14% over the same time frame. “Live Resin” also makes up the plurality of “Concentrate” sales, increasing in category share from 29% in 2020 to 33% in 2021. In comparison, its closest rival is “Wax” with 24% of Concentrate sales.
At Revolution Global, an Illinois-based cultivator and processor that recently won a 2021 High Times’ Illinois Cannabis Cup in the “Best Concentrate” category for its Blueberry Clementine live resin this year, live resins make up 5%-7% of total monthly sales, according to Dusty Shroyer, the company’s president and COO. While live resin products are especially popular with the connoisseur crowd, he says the increasing number of products in the category is mostly supply, not demand, driven.
Especially in markets like California, “there's an abundance of greenhouse cannabis that's getting frozen straight off the stem,” Shroyer explained, noting this “has allowed extractors there to have a lot of live resin material.”
WAKEFIELD, Mass., Dec. 16, 2021 – PRESS RELEASE – Curaleaf Holdings Inc., a leading international provider of consumer products in cannabis, announced that it has closed its previously announced private placement of 8% senior secured notes due 2026 (the "Notes"), with a settlement date of Dec. 15, 2021, for aggregate gross proceeds of $425 million (the "Offering"). The Notes are governed by a trust indenture that was entered into on closing of the Offering (the "Indenture").
The Indenture enables the Curaleaf to issue additional notes on an ongoing basis as needed, subject to maintaining leverage ratios and complying with the other terms and conditions of the Indenture. In addition, the Indenture permits up to $200 million of senior bank financing.
The net proceeds from the Notes will be used to refinance existing indebtedness, for working capital, and to pay transaction fees and expenses. The Notes were issued at 100% of face value, are senior secured obligations of the company, and bear interest at a rate of 8% per annum, payable semiannually in equal installments until the maturity date, unless earlier redeemed or repurchased. The Notes will mature on Dec. 15, 2026.
"We are pleased to successfully complete what we believe is the largest debt financing of any publicly traded MSO to date, underscoring our leading market position and strong financial profile,” Curaleaf CEO Joe Bayern said.
“With the closing of this offering and refinancing of our existing debt, we have meaningfully reduced the average interest rate on our outstanding debt,” he said. “In addition, by strengthening our already solid balance sheet and gaining increased flexibility to raise additional debt financing as needed, Curaleaf is extraordinarily well-positioned to execute both organic and M&A growth initiatives and continue building leading brands."
Seaport Global Securities LLC and Canaccord Genuity Corp. (the "Agents") acted as placement agents for the Notes in the U.S. and Canada, respectively.
As the cannabis industry turns the corner into a new year, many people within the space and in government and policy are advocating for more representation and ownership for Black, Indigenous, and People of Color (BIPOC) in cannabis. In many cases, they’re making that a reality, all the while acknowledging that much more work needs to be done.
At Cannabis Conference 2021, Cannabis Business Times and Cannabis Conference awarded Ngiste Abebe, vice president of public policy at Columbia Care, with a Cannabis Leadership Award. Abebe champions for social equity in the market, and broke down what that really means in an interview for a CBT profile.
“The three pillars of equity that I always raise when I’m talking about equity and policy, which is, first, stop the harm,” she told CBT. “You know, not just stopping arrests, but expungements, resentencing, all of those things. [Second], equity in the cannabis industry means making sure that there’s licensed program support for folks who were impacted by prohibition having the opportunity within the industry. And then equity beyond that, because not everybody who was harmed by prohibition wants to own a license; how else are we restoring the hopes and dreams that were shattered by prohibition?”
These are some of the social-equity storylines that CBT has been following this year:
Internships for HBCU Students and Graduates
The U.S. Cannabis Council (USCC) recently announced that it has partnered with the Congressional Black Caucus Foundation to launch the Spring 2022 Pathways to the C-Suite internship program. Seniors and recent graduates from historically black colleges and universities (HBCUs) will work with eight of USCC’s member companies and organizations.
New Mexico’s Cannabis Control Division (CCD) has announced that it issued the state’s first adult-use cannabis licenses Dec. 15 to three producers.
“This is a big day for New Mexico’s future,” said Gov. Michelle Lujan Grisham, in a public statement. “I am proud of the work this administration has done. Securing legalization was only the first step. Creating an industry where New Mexico entrepreneurs can prosper and where communities can reap the economic benefit of a new industry is crucial. And today’s news is a key milepost in that ongoing effort.”
The first producer license went to Steve Martinez, Mitchell Martinez, and Tony Martinez, a father-and-sons team in Aztec.
The first micro producer licenses were awarded to Carver Family Farm in Albuquerque and BAUDABOOMZ2 in Edgewood.
“With the issuing of these three licenses, the adult-use cannabis industry in New Mexico is officially up and running,” said Regulation and Licensing Department (RLD) Superintendent Linda M. Trujillo, in a public statement. “In the coming days and weeks, we look forward to licensing more cannabis businesses and microbusinesses so that entrepreneurs, communities and the state can maximize the economic opportunities created by a thriving cannabis industry.”
The Ohio Senate has passed legislation that would make sweeping changes to the state’s medical cannabis program, according to a WBNS report.
Senate Bill 261, which was introduced by State Sen. Steve Huffman last month, would allow physicians to recommend cannabis for any condition, increase the number of dispensary licenses in the state, and allow cultivators to expand their operations.
The measure would also create a new Division of Marijuana Control within the Ohio Department of Commerce to oversee the state’s medical cannabis dispensaries, which are currently regulated by the Ohio Board of Pharmacy.
RELATED: Ohio Republican Aims High With Medical Cannabis Expansion Bill
The bill stipulates that there should be one dispensary for every 1,000 of the first 300,000 registered medical cannabis patients, and proposes adding more retailers as needed, WBNS reported.
The Colorado Department of Revenue (DOR) and Colorado Department of Public Health and Environment (CDPHE) have issued a health and safety advisory after identifying a potentially unsafe cannabis concentrate produced by Innovative Fusion LLC, which does business as DRIP.
The DOR identified batches of medical and adult-use cannabis that had not been tested, were not tested properly, or were confirmed to contain levels of contaminants, potency, and/or homogeneity that were above the state’s acceptable limits.
The DOR and CDPHE have deemed all batches of medical and adult-use cannabis produced by DRIP to be a potential threat to public health and safety.
The contaminated or untested batches were sold to consumers in Colorado before Dec. 10, and the health and safety advisory states that consumers who experience adverse health effects after consuming the product should seek medical attention and report it to the dispensary where they purchased the product.
In addition, those who have cannabis products produced by the following licensees should return them to the dispensary where they were purchased:
Medical Marijuana Products Manufacturer License: 404-00615Retail Marijuana Products Manufacturer License: 404R-00338Retail Marijuana Products Manufacturer License: 404R-00355The U.S. Cannabis Council (USCC) is on a mission to create a diverse and inclusive cannabis industry with equal opportunities for all entrepreneurs, which means shattering what USCC Director of Social Equity & Inclusion Tahir Johnson views as the biggest barrier of entry for Black business owners: lack of access.
“U.S. Cannabis Council’s goal or mission is to make sure it’s a diverse and inclusive industry that’s prosperous for everyone, not only in equity and license ownership, but also in making sure that the cannabis industry itself is diverse,” Johnson told Cannabis Business Times and Cannabis Dispensary.
To improve access to the industry for Black entrepreneurs, the USCC is launching a new internship program in partnership with the Congressional Black Caucus Foundation (CBCF), as well as maintaining its diversity, equity and inclusion (DEI) task force, which is about to launch a tool to assess member companies’ success in these areas.
‘A Strong Pathway to Future Leadership’
The Spring 2022 Pathways to the C-Suite internship program will partner Black college seniors and recent college graduates with eight of USCC’s member cannabis companies and organizations, including ACHEM, Canopy, Columbia Care, Curaleaf, Holistic, Marijuana Policy Project, USCC, and Weedmaps.
The deadline for applications was Dec. 3, and the internship program officially kicks off in January.
Driving up yields is key to greater profit margins in the cannabis space, especially for indoor operators who have to balance the costs of running and maintaining their facility.
While several factors contribute to the end result of any grow cycle, the inputs that lead to good yields are primarily three-fold: environmental control, lighting and watering or fertigation, according to Geoff Brown, the vice president of product and business development at AGronomic IQ, formerly Quest IQ.
“We sort of call it the triangle of good yields,” Brown said. “And investing in a purpose-built, unitary solution removes the HVAC challenge for growers.”
Choosing an all-in-one system to deliver the most precise temperature and humidity control allows indoor operators to take a hands-off approach to HVAC and a hands-on approach to what they entered the business for—growing cannabis.
While some indoor operators walk into a retrofitted facility where they utilize numerous pieces of HVAC equipment in a Frankenstein approach to controlling their environments, the cost and time associated with maintenance to as many as 15 different units results in distracted growers who are the mercy of 15 sources of failure or breakdowns. In addition, those units sometimes work against one another, driving up energy costs that may exceed a facility’s power limit.
Investing in unitary HVAC equipment that is engineered from the ground up and purpose-built for the indoor cannabis space may be an unbudgeted cost for new operators entering the industry, but choosing the right system can help growers maximize their yields and provide a return on investment (ROI) that supports energy efficiency, consistent grow cycles and scalability.
Editor’s Note: This article is an extract taken from the Getting Grow Rooms Rightbook, published by AGronomic IQ. The book can be downloaded in its entirety at AGronomicIQ.com.
Ensuring that HVAC equipment is properly sized for its grow room application is critical for growers, as it will help define the success and profitability of your operation.
Units that are too big cost more to buy and use far more energy than necessary and could possibly result in an overcooled or overdried space. Similarly, equipment that is too small will be unable to keep up with demand and result in space conditions such as overheating or excess humidity, and these issues could potentially reduce crop quality or put plants in danger.
Given the many variables at play in grow rooms, significantly more than in standard environments, and considering most engineers are unfamiliar with this specific application, sizing calculations for grow room HVAC has been a very challenging task. This is largely due to misinformation and a lack of knowledge among those involved in the facility design industry. Even the most technically qualified engineering firms have had to guess at a considerable amount of the science and mechanics behind creating optimal grow environments due to a lack of HVAC design standards for engineers, and because the cannabis industry is so secretive about what works and what does not. In this industry, engineering jobs are extremely complex and involve dozens more variables than designing traditional HVAC systems for commercial buildings.
Getting grow room specifications right requires careful modeling of grow cycles, transpiration rates, temperature and humidity specifications, lighting loads, and irrigation loads, just to name a few. It also requires careful modeling of external factors, including annual temperature and humidity ranges, type of building structure, solar impacts of mixed-light sources, etc. Some of these factors may vary by type of plant and strain, which only further complicates the matter.
The Unitary Advantage
St. Louis Mayor Tishaura O. Jones signed a cannabis decriminalization bill into law Dec. 13 that repeals city ordinances that previously made it illegal to possess 35 grams or less of cannabis, according to the St. Louis Post-Dispatch.
The new law stipulates that the odor or presence of cannabis can no longer be sole probable cause for search and arrest, the news outlet reported. The measure also prohibits police from enforcing state and federal laws prohibiting the possession of small amounts of cannabis, with certain exceptions.
In a news conference before the bill signing, Jones said enforcing strict cannabis laws takes police resources away from violent crime, according to the St. Louis Post-Dispatch, and that the new policy will reduce racial disparities in policing.
Malta became the first European country to legalize adult-use cannabis Dec. 14 when its parliament approved legislation that would legalize the cultivation and possession of cannabis for adults 18 and older.
RELATED: Malta to Legalize Cannabis Cultivation, Possession for Personal Use
The bill, which is expected to be signed into law by the president, allows adults to possess up to 7 grams of cannabis and to cultivate up to four plants, but consuming cannabis in public or in the presence of minors will remain illegal, according to an AP News report.
Those cultivating plants for personal use can store up to 50 grams of dried cannabis, AP News reported, and the law allows non-profit clubs to distribute cannabis and cannabis seeds to their members.
The legislation also establishes an authority that will work with Malta’s government to develop national policy regulating cannabis use, according to the news outlet.
New Mexico’s Cannabis Control Division (CCD) is now accepting applications for all cannabis license types as it works to get the state’s adult-use program up and running.
The department, which had received more than 1,500 adult-use cultivation license applications as of mid-November, has expanded its application process to include manufacturing and retail businesses “to further streamline the licensing process,” according to a press release.
“The Cannabis Control Division’s licensing system is open for business,” Regulation and Licensing Department (RLD) Superintendent Linda M. Trujillo said in a public statement. “As part of the CCD’s mission to stand up a thriving adult-use cannabis industry in New Mexico, we are expanding user-friendly online platform to allow applicants to start the licensing process now for more business types so that they can be prepared as more rules are being quickly finalized.”
Prospective entrepreneurs can access the New Mexico’s licensing application system online, but the CCD will not issue cannabis licenses until the state’s adult-use rules have been finalized, according to the press release.
Final regulations for New Mexico’s adult-use cannabis industry must be adopted by a Jan. 1, 2022 deadline and sales are set to launch by April 1.
December 14, 2021 – Orange County, CA – PRESS RELEASE – Tyson 2.0, legendary boxer, entrepreneur and icon Mike Tyson’s newly launched cannabis company, announced today that its premium quality cannabis line is now available at more than 100 retailers across the state of California. Designed with his national fanbase in mind, Tyson 2.0 cannabis products will provide consumers with a suite of flower products offered at multiple price points.
“With the launch of products in California, consumers throughout the golden state can now experience some of my favorite cannabis products and strains. Each Tyson 2.0 product has been personally tested and approved by me. I’m better today thanks to the healing powers of cannabis, and I’m eager to share what we’ve created so others can benefit from this magical plant the way I have,” said Tyson, Chief Brand Officer for Tyson 2.0.
RELATED: Mike Tyson’s New Cannabis Brand Will Sell 1-Oz. Bags of Flower in Colorado
As a cannabis company, secured debt may be your only option for a line of credit or for funding the evolution of your business.
Secured debt is where the lender takes a lien against either all assets or a particular set assets of a borrower as collateral for a loan. As can be imagined, trudging blindly into this type of debt can sink your business. Moreover, there are particular concerns when cannabis companies incur secured debt.
Increasingly, experienced secured debt lenders are entering this space, but a significant portion of those potential partners remain prohibited by federal law from participating in cannabis company debt. In the meantime, it falls disproportionately on cannabis companies to educate and steward and carefully consider potential debt partners. Unless you have been active in the space before, it is going to be hard for you to judge what is right, wrong or weird without trusted advisors.
The responsibilities between a borrower and the lender are commonly misunderstood. It is not an equal (or close to equal) partnership, which is the universal issue of this article. If you incur secured debt, it is your responsibility to understand that your lender has a right to your collateral—a right that is superior to rights of all others.
The consequence of misunderstanding this relationship can be the lender calling default on your loan.
Grasping this responsibility involves two important concepts under Article 9 of the Uniform Commercial Code (UCC):
Malta is poised to become the first European country to legalize cannabis cultivation and possession for personal use.
The Maltese parliament is expected to vote in favor of the legislation on Dec. 14, according to The Guardian. The law will then be signed by the president and is expected to be implemented by this weekend.
The legislation would legalize the possession of up to 7 grams of cannabis for adults 18 and older, The Guardian reported, as well as allow adults to grow up to four cannabis plants at home for personal use.
The new law would also allow non-profit cannabis clubs to cultivate plants to distribute to their members, according to the news outlet. Club membership would be limited to 500 people and clubs can only distribute up to 7 grams of cannabis to each member per day, with a maximum of 50 grams per month.
Cannabis policy reform has been on the rise in Europe this year. Germany is also on the cusp of legalizing adult-use cannabis; its new governing coalition is expected to introduce legislation that would allow specialized shops to sell cannabis products.
