When Hath, a newly launched CBD brand, had an ad approved to run on Facebook and Instagram earlier this month, the video didn’t show any of the company’s products, and purposefully used “neutral language,” according to Kelley Ireland-Kelly, co-founder and CMO of Hath. The copy on the ad: “Discover the next generation of wellness and start feeling better today.”

“You really have to avoid language that would send red flags to the FDA,” said Kelly. “The challenge is that it doesn’t really provide a lot of information for the customer or solve a lot of their questions because our ads that are approved have to stay pretty vague.”

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PRESS RELEASE: OAKVILLE, ONTARIO - GVA Lighting, Inc., a Canadian manufacturer specializing in high-tech, reliable, outdoor, color-changing LED fixtures has officially launched a new, horticultural lighting division called “Linnaeus Lighting”.

Dmitry Bernadiner, the CEO and president of GVA Lighting said: “We are thrilled to officially enter this new, exciting market and I believe that we have a lot to offer growers. GVA has been designing and manufacturing LED lighting products in Canada for almost 20 years and we have a unique experience in making the most durable, highly advanced, color-changing luminaires and lighting up various architectural landmarks around the world. It seemed like a natural step to take what we know about designing and building high quality fixtures for the architectural world and apply the know-how to the horticultural industry.”

“The horticultural lighting product design started about two years ago and we have put a lot of time and effort into researching how lighting works in the horticultural world. I think we now have a compelling lineup suitable for large-scale growers and home growers alike” Vladimir Grigorik, the company chairman and CTO added.

Linnaeus Lighting soft-launched its Hedera family of fixtures at the Cannabis Conference in Las Vegas in April 2019 and later promoted them at O’Cannabiz in Toronto, Canada, and at GreenTech in Amsterdam.

The Hedera family of slim, linear LED fixtures consists of three models: Helix, Vertex, and Apex, each suitable for different applications. Hedera Helix is a high-efficacy, cost-effective solution meant to be used by commercial indoor facilities as well as home growers. Hedera Vertex, with its 60° optic, was designed with greenhouses and green “living” walls in mind. Hedera Apex is a state-of-the-art smart fixture with digital controls and six adjustable color channels, intended for academic or private research, giving its user complete control over the light spectrum.

All three fixtures are highly customizable in terms of light recipes and are available in different sizes ranging from 600mm (2 ft.) to 1,500mm (5 ft.), with a robust tempered glass lens, built to meet the IP66 and IP67 standards for easier cleaning and maintenance along with a 5-year limited warranty.

Linnaeus Lighting offers the highest quality horticultural lighting on the market using the proprietary technologies its parent company GVA Lighting has developed over the last two decades.

GVA’s UNIBODY technology brings a high degree of reliability to the fixture construction with no seams, endcaps or gaskets. INFINITY® technology gives customers the ability to power fixtures in the entire facility from remote, rack mounted power supplies bringing peace of mind and easy serviceability. Combined with the revolutionary Hornet (Horticultural Networking) protocol which can control over 65,000 Hedera Apex fixtures on a single low-cost network, Linnaeus Lighting is heading to forefront of the horticultural lighting revolution. 

COLUMBUS, Ohio, July 09, 2019 (GLOBE NEWSWIRE) PRESS RELEASE -- Green Growth Brands Inc. is pleased to announce that it has entered into a securities acquisition and contribution agreement, dated as of July 8, 2019, with, among others, MXY Holdings LLC (Moxie) under which a new Ontario limited partnership, of which GGB will be the general partner (GGB LP), will acquire the operating companies of GGB and the issued and outstanding units of Moxie, an arm’s length third party, in an all-equity interest transaction. As part of the Transaction, GGB will also be directly acquiring shares of MXY C, INC. and MXY D, INC., Delaware entities within the Moxie structure, and interests in two entities, PurePenn LLC and Pure CA, LLC (collectively, the Pure Entities), with which Moxie has current acquisition agreements (subject to regulatory approval). 

The equity purchase price of the Transaction is US$310 million, and will be satisfied through the issuance of either GGB Common Shares or Exchangeable LP Units, as more fully described below.

The Transaction is a part of GGB’s focused growth strategy. GGB is rapidly building its cannabidiol (CBD) business, including recently securing additional distribution through Designer Brands Inc., the parent company of DSW shoe stores and Abercrombie & Fitch Co., and is expanding its footprint of Seventh Sense Botanical Therapy shops from the current 61 to an expected 200+ by the end of calendar year 2019. GGB is also building its MSO network, which now includes the potential for up to 47 dispensary licenses in three key states.

The combination of Moxie and GGB would create one of the first cannabis companies to provide consumers a comprehensive product offering, including both CBD and tetrahydrocannabinol (THC) product lines and distribution that runs from mainstream retail to cannabis dispensaries, all led by management with decades of expertise and credibility.

Management Commentary

"In the short time since we began operations, we have built a business comprised of highly experienced management and merchant teams and cannabis experts, who have created successful CBD and MSO businesses. The coming together of Moxie and Green Growth Brands is anticipated to complete the circle," said Peter Horvath, CEO of Green Growth Brands. “As a '360 degree' cannabis company, we expect to bring an expertise to each segment of the combined business: cannabis dispensaries, vertically-integrated and wholesale CBD and wholesale cannabis consumer products."

"The pairing between Moxie and Green Growth Brands is anticipated to accelerate growth for both businesses that results in a differentiated and expansive business model," said Jordan Lams, Co-Founder and CEO of Moxie. "Moxie's success comes from keeping our promise of delivering premium quality products to our consumers that creates an emotional connection with Moxie across multiple geographies. Both companies have proven track records of building customer loyalty through authenticity, and together, we are going to focus on taking steps to rapidly grow America's mainstream cannabis brands."

Terms of the Transaction

The Transaction is structured to include the formation of GGB LP, a new Ontario limited partnership of which GGB will be the general partner, with the operating companies of GGB being placed under the partnership. Payment of the Purchase Price will be satisfied through the issuance of common shares of GGB and exchangeable limited partnership units in GGB LP as follows: (i) through the issuance of GGB Common Shares to the shareholders of MXY C and MXY D; (ii) through the issuance of either GGB Common Shares or Exchangeable LP Units to the unitholders of Moxie; and (iii) through the issuance of Exchangeable LP Units to the holders of the Pure Entities. The Exchangeable LP Units are exchangeable into GGB Common Shares on a one-for-one basis for no additional consideration; however, the Exchangeable LP Units may not be exchanged for GGB Common Shares for the first year following the closing of the Transaction.

The total number of securities issuable as payment under the Transaction is equal to that number determined by dividing the Purchase Price by the 30-day volume-weighted average price (VWAP) of GGB Common Shares ending on the third trading day prior to the closing (but in no case will the Closing VWAP be less than US$2.07 or greater than US$3.45 (being the equivalent to CAD$2.71 and CAD$4.52, based on the Bank of Canada exchange rate as of July 5, 2019)), such that following the issuance of the GGB Common Shares and Exchangeable LP Units, the former Moxie members, the shareholders of MXY C and MXY D and the holders of the Pure Entities will hold between approximately 30% and 42% of the fully-diluted equity of GGB (treasury method and assuming the closing of GGB’s previously announced Spring Oaks acquisition in Florida) with the majority of such securities to be subject to lock up agreements for a period of 12 months from the completion of the Transaction with staggered releases. 

The Agreement may be terminated in certain circumstances including by mutual agreement of the parties; by either party for a significant breach by the other party that would cause the closing conditions not to be met; by either party if the Transaction has not been effected by June 30, 2020; by Moxie, if it does not receive a legal opinion from counsel regarding the United States federal income tax consequences of the exchange of certain units of Moxie for Exchangeable LP Units; or, by GGB, if GGB enters into an agreement regarding an acquisition transaction. Subject to the terms and conditions set out in the Agreement, if either party terminates as a result of a significant breach by the other party, the breaching party will pay a termination fee of US$10 million or if the Agreement is terminated by Moxie in the event of an Opinion Termination, it will pay GGB a termination fee of US$10 million. If the Agreement is terminated by GGB in the event of an Acquisition Termination, GGB will pay to Moxie a termination fee of US$17.5 million. GGB will satisfy payment of its termination fee, in either case, in GGB Common Shares, and Moxie will satisfy payment of its termination fee, in either case, through forgiveness of the Loan (as defined below) and a cash payment.

The closing of the Transaction is expected to occur within the following six months, but remains subject to the satisfaction of various closing conditions, including receipt of all necessary regulatory approval for the transfer of the cannabis-related licenses of Moxie by local and state authorities in each of the markets where Moxie’s assets and licenses are held; approval from the Canadian Securities Exchange for the listing of GGB Common Shares issuable in connection with the Transaction (including the GGB Common Shares issuable upon the exchange of the Exchangeable LP Units); that all required securityholder approval for Moxie, MXY C and MXY D is received and certain pre-closing transactions have been effected; that the Lock-Up Agreements have been entered into; there has been no material adverse effect in respect of either Moxie or GGB; and, that all documents required in connection with the transfer of Moxie, MXY C and MXY D securities have been delivered to GGB.  There can be no assurance that the Transaction will be consummated.

On closing, the controlling members of Moxie will be entitled to nominate two directors of GGB and, in connection with the foregoing, the Company and certain shareholders of GGB, will enter into a nomination rights and voting agreement with respect to matters relating to the nomination and election of such nominees.  Management of Moxie will continue to lead the company as part of GGB, with key management joining GGB.

As part of the Transaction, Moxie has agreed to make available a loan of US$5 millionto GGB in order to fund certain pending acquisitions and the parties have agreed to enter into a distribution agreement. The Loan will bear interest at 6% and, if the Transaction is terminated, will be repaid within 12 months of termination.  The Distribution Agreement provides that GGB will distribute Moxie CBD products through its kiosk and dispensary network for a period of up to thirty (30) months.

Both companies’ board of directors have determined that the proposed transaction is in the best interests of their respective companies. Canaccord Genuity Corp. has delivered a fairness opinion to the board of directors of GGB, and Eight Capital has delivered a fairness opinion to the board of managers of Moxie.

A coalition of national organizations will work together to advocate for cannabis reform with a focus on racial justice in this emerging industry, according to public statements issued today.

The newly formed Marijuana Justice Coalition comprises the ACLU, the Center for American Progress, the Drug Policy Alliance, Human Rights Watch and other organizations committed to advancing social equity in the private and public spheres. The announcement has been timed with the planned July 10 House Judiciary Committee hearing on cannabis laws and racial justice in the U.S. 

“This coalition was formed with the goal of reforming federal marijuana laws, but doing so in a way that gives back to the communities most impacted by the war on drugs,” Queen Adesuyi, policy coordinator at Drug Policy Alliance’s Office of National Affairs, said in a public statement. “Black and brown people have been traumatized by our racist marijuana laws and, as the federal government embraces reform, our groups will make sure that any proposal will repair the damage done to those communities.”

Read the full statement and the coalition’s set of principles below. 

***

For decades, marijuana prohibition has devastated the lives of millions and disrupted the economic and social fabric of communities. The continued enforcement of marijuana prohibition laws results in over 600,000 arrests annually, disproportionately impacting people of color who are on average almost 4 times more likely to be arrested for marijuana possession than their white counterparts, despite equal rates of use across race. Additionally, simple marijuana possession was the fourth most common cause of deportation for any offense and the most common cause of deportation for drug law violations.

An ever-growing majority of American voters—68% percent—support marijuana legalization, according to a 2018 Center for American Progress and GBA Strategies poll. Even higher, 73% of American voters support the automatic sealing of marijuana offenses.

The nation has moved beyond the question of ‘should we legalize marijuana?’, and is now grappling with ‘how do we legalize?’ Thirty-three states plus the District of Columbia have adopted laws allowing legal access to medical marijuana with 11 states plus the District of Columbia allowing legal access to recreational marijuana. Nationwide, the communities that have been most harmed by marijuana prohibition are benefitting the least from the legal marijuana marketplace.

Individuals who have suffered from the impact of a marijuana arrest or conviction are still languishing from the thousands of unique collateral consequences of over-enforcement of marijuana laws—collateral consequences that include difficulty securing or maintaining employment, housing, federal financial aid, nutritional assistance, the ability to vote, a valid driver’s license, and harsh immigration-related consequences for noncitizens.

Despite the fact that the harms of marijuana prohibition have not been borne equally across the nation and across specific populations, people of color are woefully underrepresented in the marijuana industry. Historically disproportionate and racially biased arrests and convictions make it particularly difficult for Black and Brown people to enter the legal marijuana marketplace, as most states bar these individuals from participating because of their record. The Administration recently threatened that it will deny naturalization to lawful permanent residents, the great majority of whom are people of color, if they are employed in the industry. Other barriers include exorbitant licensing fees and the need for large amounts of capital before gaining a license.

Ending prohibition on the federal level presents a unique and desperately needed opportunity to rightfully frame legalization as an issue of criminal justice reform, equity, racial justice, economic justice, and empowerment, particularly for communities most targeted by over-enforcement of marijuana laws.

As Congress considers the end of marijuana prohibition, the Marijuana Justice Coalition believes that any legislation that moves forward in Congress should be comprehensive. The provisions set forth below are agreed upon by the undersigned criminal justice, drug policy, civil rights, and anti-poverty groups as principles that should be considered as a part of any moving marijuana reform efforts in Congress:

• Descheduling marijuana, as maintaining marijuana on the Controlled Substances Act serves to preserve federal criminalization and enforcement. 
• Criminal justice reform provisions (e.g. expungement, resentencing).
• Provisions eliminating barriers to access to public benefits (e.g. nutrition assistance, public housing, etc.) and other collateral consequences related to an individual’s marijuana use or previous arrest or conviction.
• Provisions eliminating unnecessarily discriminatory elements for marijuana use, arrests and convictions, including drug testing for public benefits or marijuana use as a reason for separating children from their biological families in the child welfare system.
• Provisions that ensure that marijuana use or participation in the marijuana industry does not impact the immigration status of noncitizens nor their ability to naturalize.
• Marijuana tax revenue be directed to local units of government and community-based organizations to reinvest in individuals and communities most impacted by the war on drugs, particularly through programming that helps eliminate the collateral harms of marijuana prohibition, especially for individuals with systemic and structural barriers to employment and/or living in high-poverty communities.
• Marijuana tax revenue be directed to support entrepreneurs from communities directly impacted by the war on drugs with a process to provide them with the requisite capital to develop cannabis businesses, and encourage emerging licensing programs to be inclusive and reflective of their communities.

Signed by the members of the Marijuana Justice Coalition:
ACLU • Center for American Progress • Center for Law and Social Policy •
Drug Policy Alliance • Human Rights Watch • Immigrant Legal Resource Center •
Lawyers’ Committee for Civil Rights Under Law • Leadership Conference on Civil & Human Rights • NORML • Students for Sensible Drug Policy