LOS ANGELES, California, June 29, 2021 – PRESS RELEASE - Vertical Wellness, a company in the branded health and wellness space, has announced a merger with CanaFarma Hemp Products Corp., a full-service company operating in the hemp industry offering a full range of hemp-related products and services.
The Vertical Wellness management team, including CEO J. Smoke Wallin, will run the combined business. The combined company will go under CanaFarma Corp. as the corporate entity but will keep the Vertical Wellness name.
This merger will make Vertical Wellness the first house of cannabidiol (CBD) brands to go public. The combined company will be worth over $50 million but could be significantly higher depending on stock price post-announcement.
CanaFarma went public in March 2020 just as the COVID-19 pandemic hit. The company had a successful IPO on the Canadian Securities Exchange, trading up to about $1.50 a share and ending up being an over $200 million market cap company.
“This is a platform for Vertical Wellness to fulfill its vision. To launch a portfolio of brands along a vast array of categories and segments requires resources, and the CanaFarma deal enables us to attract those resources at a scale we need," Wallin said. "It's a great combination because we can pursue our goal to become the preeminent brand company in the cannabinoid-derived health and wellness space.”
Vitaly Fargesen, senior vice president of strategic planning at CanaFarma Hemp said, “CanaFarma Hemp was founded with the express intention to be a large-scale brand company in the health and wellness space. Since early 2021, we have looked for the right opportunity to accelerate our mission through a business combination. Smoke and his team at Vertical Wellness are exactly what we were looking for, and our investor base could not be more excited to have him lead our combined company.”
chuchart1972 | Adobe Stock
Cultivators Dial Back Operations Amid Historic PNW Heat
As a brutal heat dome continues to scorch the Pacific Northwest, cannabis cultivators are scrambling to protect their crops, their teams and themselves.
A heat dome trapped over the Pacific Northwest has broiled much of the region, with record-setting triple-digit temperatures being felt from Whistler, British Columbia, all the way to Northern California. Cannabis cultivators in the area are hard-pressed to keep operations going as they try to protect both their crops and their teams from the potentially deadly heat.
“We are roasting both in Ellensburg and Seattle,” Jade Stefano, co-founder and CEO of Washington-based Puffin Farm, told Cannabis Business Times in a June 28 email. Stefano reported temperatures of 105 degrees Fahrenheit, with a weekly high of 112 degrees expected in the coming days.
Per The Washington Post, a heat dome is a pocket “of slow-moving hot air under higher pressure that blocks new weather systems from moving in.”
Stefano, who operates both an indoor extraction facility in Seattle and greenhouse operation in Ellensburg, added that conditions weren’t much improved in the greenhouse—even with shade cloths and swamp coolers, the structures remain above 80 degrees. While that is an improvement on the outdoor temperature, it remains elevated for ideal cannabis cultivation (which typically is set in the mid-to-high-70s).
Alex Cooley, co-founder of Solstice, which cultivates indoors, outdoors and in greenhouses in Seattle, Ephrata and Trinidad, Washington, said the company has moved shifts up earlier in the day, with some starting at 4 a.m. In addition, he noted they have increased irrigation frequency but decreased volume, and water right before the lights go out.
And, like Stefano, one of the primary tools Solstice using to beat the heat is “shade cloth, shade cloth, shade cloth,” Cooley said in an email sent June 29.
In Washington's Okanogan County, Cannasol Farms owner Jeremy Moberg said that the most shocking aspect about the heat is how early it arrived this year. While he has experienced triple-digit temperatures in past years, “it was like one day in August. ... It wasn't prolonged,” he said in a phone interview with CBT.
Moberg said he has yet to see any outsized negative impacts from the heat on the crops but remains vigilant for the health and safety of his team, especially when working under light-deprivation structures where he estimates the air to be approximately 130 degrees F (or roughly 55 degrees Celsius). He has stocked up on popsicles for staff to keep cool, as well as shifted work schedules to 5-10 a.m. so his team would not be working under the direct sun or during the peak heat.
As temperatures rocketed to 104 degrees in the Emerald City over the weekend, Stefano is allowing staff at the Seattle extraction lab to start and finish work earlier, or simply not come in. That’s because the warehouse is not equipped with air conditioning (the farmhouse in Ellensburg does have A/C for the team members to cool off).
In Southern Oregon, Takilma-based East Fork Cultivars saw temperatures peak at 115 degrees F this past weekend. Aaron Howard, co-founder of East Fork Cultivars, said in an email to CBT on June 29 that the company was able to plant its crop a bit earlier this year (thanks to warm and dry temperatures), allowing the plants to acclimate to the outdoor conditions over a longer period before the heatwave hit, minimizing heat-related plant stress. “I imagine if we had only just planted, the plants would have struggled,” he said.
To keep his recently planted crops alive through the heat, Moberg has been using roughly twice the amount of water he would normally be using at this time. “I have two of my own wells, and I’m a little bit worried about them going dry,” he said. “We are lucky enough to have a big, massive aquifer that dates back to the ice ages. But we're essentially mining [water]. It's not being replaced at the same rate.” Stefano also increased irrigation frequency in addition to running sprinklers through the crop.
Moberg said farmers who typically plant later in the season might want to consider waiting a few extra days to ensure clones and smaller plants don’t get overwhelmed by both the transplant shock and heat stress, the combination of which could lead to total crop loss.
One benefit of the heat, according to Moberg, is that he has not experienced the same pest pressures as in years past—although that is likely to be short-lived. Once the temperatures drop to optimal conditions for pest development, he expects insects such as russet mites to make their presence felt as they return to their normal lifecycles. “Be on top of the pest pressure,” he advised, “’cause it's going to follow the heatwave.”
Cannabis Business Times editor Michelle Simakis contributed to this story.
After an employee termination, unionized cannabis dispensary workers hold a one-day strike June 26 at the Greenleaf Compassionate Care Center in Portsmouth, R.I.
Courtesy of UFCW Local 328
Greenleaf Terminates Employee Involved With Union Negotiations in Rhode Island; Worker Strike Ensues
The UFCW Local 328 is now filing unfair labor practices charges with the National Labor Relations Board.
When Ben Telford showed up for work June 23 at the Greenleaf Compassionate Care Center in Portsmouth, R.I., he was shocked to learn that his employment was terminated.
In April, Greenleaf Portsmouth employees became the first cannabis dispensary workers in the state to unionize after a 21-1 vote to join the United Food and Commercial Workers Union (UFCW) Local 328. The organized Greenleaf team includes budtenders, keyholders, online team members and delivery associates.
Employed by Greenleaf since May 2020, Telford was a keyholder at the Portsmouth medical cannabis retail facility in Portsmouth, where his responsibilities included opening and closing the store, cash management and day-to-day operations, as well as performing other duties in the absence of management. He was also a member of Greenleaf’s union bargaining committee, a role he retains.
Courtesy of UFCW Local 328
Ben Telford, second from right, had his employment as a keyholder at the Greenleaf Compassionate Care Center in Portsmouth, R.I., terminated on June 23.
“I was definitely shocked,” Telford said of his termination. “I’m a hard worker, both on the job, at the site, and then off the job as far as the effort to unionize and get our team together and get a contract negotiated.”
While his termination came as a surprise, Telford said he had thought about the possibility.
“I’ve been a very loud voice for myself and for others on the team that worked there,” he said. “But the reason I was given the day I was terminated … was that my services were no longer required. And when I asked for further explanation, I was told that there was none needed to be given at the time, so I gathered my belongings and left for the afternoon and said goodbye to everybody.”
Telford was informed of his termination by Greenleaf’s chief of staff and director of retail operations, but he said it’s his understanding that the decision came from Greenleaf CEO Seth Bock. Cannabis Business Times and Cannabis Dispensary reached out to Bock for comment but as of June 30 have not yet received a response.
According to a UFCW Local 328 press release, Telford’s termination is only the latest in a string of firings by Bock. “In the last six months, the Greenleaf CEO has fired the director of retail operations, the head of delivery, the human resources manager and the chief operating officer.”
In addition, Telford said the director of inventory at a Greenleaf cultivation facility was also terminated recently.
“It depends on the person, but, overall, it’s been very retaliatory,” Telford said. “The owner, Seth Bock, has been allowed to move as he pleases. And, overall, when people get the skills that require higher pay and have had a long tenure, he’s been known to just kind of clear house and get some fresh faces that are happy to be there, because getting in the cannabis industry is something that a lot of people want to do.”
The UFCW Local 328, which represents more than 11,000 workers in a range of industries throughout Rhode Island and southeastern Massachusetts, is now filing unfair labor practices charges with the National Labor Relations Board (NLRB) over what the Local 328 called the illegal retaliatory firing of a Greenleaf employee.
The Local 328 release also claims Bock has exhibited a history of retaliation against employees.
Jeffery Dieffenbach, former finance director and general counsel for Greenleaf, was fired in January 2020. In September, Dieffenbach filed a lawsuit against Greenleaf to remedy and seek relief for unlawful employment practices arising under the Age Discrimination in Employment Act of 1967, the Americans with Disabilities Act, and other U.S. labor laws.
Dieffenbach, a 71-year-old Newport resident at the time he filed the lawsuit, worked for Greenleaf for six years. When he was first hired by Greenleaf as a part-time independent contractor, he was paid $30 per hour for 10 hours a week. By October 2018, Dieffenbach was being paid $90,000 per year as the finance director and general counsel, according to the lawsuit.
In a subsequent interview with WJAR-TV, a local NBC affiliate, Dieffenbach said, “I was never reprimanded. I was never given any negative comments or reviews of my work.”
While Greenleaf’s workers unionized in a 21-1 ballot count on April 5, 2021, they had filed for their union election in early March, citing concerns about job security and lack of workplace protections.
More specifically, contributing factors leading workers to organize included Greenleaf’s elimination of an employee sales incentive program that included weekly and monthly cash bonuses offered to sales associates, budtenders and delivery employees, Telford said. In addition, the company also reduced worker benefits such as a discount program for employee patients who also purchased medical cannabis from the center, he said.
“That came during the time of them kind of clearing house at the top end and getting rid of a few employees,” he said. “But it followed the history of abusive behavior and discriminatory practices from management.”
Amidst Telford’s termination, Greenleaf attempted to reinstate a new employee incentive program last week but then had to rescind that effort because it was not part of a union-negotiated contract, UFCW Local 328 Director of Organizing Sam Marvin said.
Theoretically, if such an incentive program is not in a contract, then the CEO can take it away at any time, he said.
“I don’t know what Greenleaf’s intent was, if it was a tactic,” Marvin said. “But they are required, and they have to come to the table and negotiate good faith over it, and they have to provide additional details like how it’s going to impact the workforce, who’s going to be eligible, who is not—really, they need to explain their proposal and why they’re proposing it, and they have to give their workers the chance to respond.”
Local 328 currently represents workers from four cannabis businesses, also including the Ocean State Cultivation Center (OSCC) in Warwick, R.I.; the Curaleaf medical dispensary in Hanover, Mass.; and the Cresco Labs cultivation and processing facility in Fall River, Mass.
After Greenleaf workers filed for their union election in March, the company hired Government Resources Consultants of America Inc., a counter-union organization based out of Illinois, according to an LM-20 Agreement and Activities Report filed with the U.S. Department of Labor.
The consultants’ objective? “To persuade employees to exercise or not to exercise, or persuade employees as to the manner of exercising, the right to organize and bargain collectively through representatives of their own choosing,” according to the report.
The out-of-state, union-prevention consultants held mandatory meetings and distributed flyers to employees at the Greenleaf dispensary, according to UFCW Local 328.
“Doing what we do, we encounter union-busters all the time,” Marvin said. “It doesn’t really matter what company or what industry you’re trying to organize. And they all say the same thing. They’re all going to try to use the same kind of tactics.”
Anti-union consultants often change their tactics based on what they think will work, but the underlying intention remains the same, Marvin said.
“They’ll talk about dues, they’ll talk about strikes, they’ll talk about, ‘Give us another chance,’” Marvin said. “They’ll talk about how long the process might take. So, they kind of throw everything against the wall and they hope that it sticks.”
The Greenleaf workers remained united with their nearly unanimous vote. Telford said his voice in favor of organizing remained active throughout the process.
After he was terminated last week, union representation reached out to Greenleaf’s lawyers for further explanation. They responded that his sales performance was subpar during the month of May, according to Telford.
“And I am not a sales associate,” he said. “Now we’re working with the National Labor Relations Board to file unfair labor practice charges and seek justice for wrongful termination.”
On Saturday, June 26, the UFCW Local 328 held a one-day strike near Greenleaf’s Portsmouth care center to protest Telford’s termination. The union employees at Greenleaf voted unanimously to authorize the strike.
“I don’t even have the words to describe the gratitude I feel and the appreciation I have for everyone, and the patients that came by while we were picketing [to] express their support too— that’s something I’ll never forget,” Telford said. “It was the most humbling experience I ever had.”
The unionized Greenleaf cannabis workers released the following joint statement in the Local 328 release:
“We want to first recognize our patients and thank them for the support we have received throughout this process of unionizing. We understand that this action may have disrupted some people’s ability to purchase their medicine, which is something we take very seriously. As workers, we strive to provide the highest quality services and products that we can, because we believe in cannabis and its medicinal benefits.
“Over these past few weeks, ownership at Greenleaf has continued to make decisions that impede us from providing that quality of work. After the wrongful termination of one of our best team members, we collectively decided that we had no choice but to take this action.
“We’re proud to work in this industry and will continue to stand together in solidarity as we progress towards our goal of negotiating a contract that helps in establishing a standard within our dispensary that supports our growth as professionals and helps bring the focus of our work back to the people that matter the most, our patients.
Courtesy of STIIIZY
STIIIZY Continues California Expansion With Dispensary Outside LA
The new Wildomar location picks up the brand’s engaging, experiential dynamics.
Earlier this month, STIIIZY opened its ninth retail location in California—this one in Wildomar, about 75 miles southeast of Los Angeles. It was an occasion that brought city officials to the store’s ribbon-cutting to celebrate the 2,500-sq.-ft. store built to support more than 50 local jobs.
Known for its engaging brand dynamics (the flagship LA store features Instagram “art pods” and an interactive LED tunnel running from check-in to the sales floor), STIIIZY captures a lively segment of the California cannabis consumer base. The company targets the cannabis connoisseur who also dabbles in the experience of a retail brand.
We chatted with STIIIZY founder James Kim about how the new Wildomar store fits into that broader story.
Eric Sandy: What does the Wildomar location mean to STIIIZY’s growth plans—both in the sense of geography and the new customer base?
James Kim: Every day at our downtown LA location we hear from people who drove an hour, even two hours, just to shop at STIIIZY. So, this new location in Wildomar not only increases needed access to safe and high -quality cannabis in an area with very few other options, but also brings STIIIZY to a region where we know we have a strong customer base.
Growing STIIIZY into a truly statewide brand means not only serving major metropolitan areas, but bringing the full STIIIZY experience to Riverside County, the San Diego area and everywhere our existing—and potential—customers live.
Courtesy of STIIIZY
ES: STIIIZY’s been known for its experiential retail store design, giving customers a more immersive shopping atmosphere. What are the notable features of the new Wildomar store?
JK: Because traditional marketing is so limited for the cannabis industry, you’re right that STIIIZY does place a premium on the in-store experience. The Wildomar store will have the attention to detail, excellent customer service, and products and pricing all of our stores are known for, but in a way what’s most remarkable about this location is how “normal” it is. Wildomar’s city government was eager to help us establish a location that was near a freeway and inside a traditional shopping plaza, and that normalizing of cannabis shows just how much the industry and municipalities have evolved from the early days of legalization.
ES: Separate from Wildomar, how has STIIIZY’s approach to retail evolved over the past year? Coming out of the pandemic, in particular, have the business’s different types of customer engagement changed?
JK: The health and safety of our staff and customers is paramount, which means creating and continuously implementing trainings and procedures over the last 18 months.
But despite the challenges, validation of cannabis as an essential business was a win for the entire industry. And for STIIIZY specifically, our continued growth even through hardship is a testament to our existing commitments to hiring only the best staff, finding easily accessible properties in each region, and using social media to maintain an engaged customer base.
Ultimately, we see ourselves and our stores belonging to the communities in which they are located. So, coming out of the pandemic, we’re excited to once again engage more extensively with our customers and the broader community through in-person events.
ES: What’s next? Any plans for the second half of 2021 that we should be watching for?
JK: As I mentioned previously, we’re focused on continued growth during the second half of the year, and beyond. The assets map on our website shows all of our retail stores in development (17 at the moment!), so I’d recommend keeping an eye on that for specific updates.
Jesce Horton Talks Small-Batch Production in Cannabis Conference’s ‘Beyond the Show’ Podcast
In Episode 2 of the new weekly series featuring conversations with Cannabis Conference speakers, the founder of LOWD shares the value cannabis businesses can find in catering to niche markets.
In the second episode of Cannabis Conference’s new podcast series Beyond the Show, Jesce Horton, founder of the Oregon-based cannabis cultivation company LOWD, joins Digital Editor Eric Sandy to talk about his journey in the cannabis industry. As a business owner in one of the most competitive cannabis markets in the U.S., Horton is finely in-tune with the ins and outs of what connoisseur cannabis consumers look for in their products.
When it comes to niche marketing, Horton emphasizes the importance of expressing the culture that you come from in your products and marketing tactics. Although the cannabis industry is quickly shifting to be centered around new consumers, Horton founded LOWD on the principle of marketing to members of the original cannabis community. Environmental sustainability and innovation are also key factors that Horton makes sure to carry over into his product marketing.
Horton also touches on the main points he will discuss during his session “How Cultivators have Succeeded Carving out their Small-Batch Niche” at Cannabis Conference 2021, including:
What vision he had in mind while establishing his business;
Which qualities make a connoisseur in the cannabis space, and how those characteristics define what they’re looking for in the flower they’re buying;
Which qualities keep in-demand products on shelves;
The importance of patience while searching for the right facility design in the fast-moving industry; and
And to hear even more from Horton about what it takes to effectively reach your target niche market, register for Cannabis Conference 2021 (Aug. 24-26, 2021, at Paris Las Vegas Hotel & Casino). His session, “How Cultivators Have Succeeded Carving Out Their Small-Batch Niche” will be held Aug. 26 from 11:25 a.m. – 12:15 p.m. PT. Regular registration rates expire July 31, 2021.
Legislative Map
Cannabis Business Times’ interactive legislative map is another tool to help cultivators quickly navigate state cannabis laws and find news relevant to their markets. View More