OAKLAND, Calif. and TORONTO, Oct. 19, 2020 /CNW/ - PRESS RELEASE - Harborside Inc., a California-focused, vertically-integrated cannabis enterprise, has reached a definitive agreement to acquire 50.1% of the equity of FGW Haight, Inc., a California corporation which has the conditional use approval necessary to operate a cannabis dispensary and related businesses in the Haight Ashbury area of San Francisco, Calif.

The acquisition further expands Harborside's footprint in the state of California, solidifying a strong presence in the historical and culturally significant Haight-Ashbury district of San Francisco.

"We're thrilled to be bringing Harborside's reputation for high-quality products and excellent retail experiences to the iconic Haight-Ashbury district," said Peter Bilodeau, chairman and interim CEO of Harborside. "Upon completion of the acquisition, build-out and receipt of all necessary approvals, our latest retail location will seamlessly blend elevated, contemporary-industrial architecture with the best-in-class service and unbeatable product selection that Harborside has become famous for. We're excited to continue engaging with our consumers and delivering strong value for our shareholders."

Under the terms of the agreement, Harborside will pay an aggregate purchase price of USD $2,179,350 (subject to purchase price adjustments) based on a post build-out and proforma working capital enterprise value of USD $4,350,000. The purchase price will be comprised of: (a) USD $1,265,000 as consideration for convertible notes of FGW entitling the company to such number of underlying shares equal to 29.1% of the shares; and (b) the balance of the purchase price in multiple voting shares valued at CAD$125 per MVS as consideration to certain selling shareholders of FGW for 21% of the issued and outstanding shares.

Harborside has also agreed to purchase an additional 29.9% of the issued and outstanding shares to get to an 80% ownership of FGW, subject to regulatory approvals. The aggregate purchase price for the subsequent shares will be USD $1,300,650, which will be satisfied in MVS valued at the greater of: (i) the 30 day VWAP of the subordinate voting shares of the company on the Canadian Securities Exchange (CSE) at the time of issuance less a discount multiplied by 100; (ii) C$150 per MVS; or (iii) such other price as may be approved by the CSE .

Lastly, Harborside will also have a right of first refusal to purchase, in its discretion, in whole or in part and in one or more closings, the remaining 20% of the shares, subject to regulatory approvals.

The acquisition is subject to certain material closing conditions, including approvals from regulatory authorities and the CSE. There can be no assurance that the transaction will be completed on the current terms or at all. Closing of the acquisition is expected to occur on or before Oct. 31, 2020.

This week, Michigan Gov. Gretchen Whitmer signed multiple “clean slate” bills into law that will automatically expunge criminal records for those convicted of certain cannabis-related offenses. Elsewhere, in Illinois, the state announced that the first eight months of adult-use cannabis sales have generated more than $100 million in tax revenue.

Here, we’ve rounded up the 10 headlines you need to know before this week is over.

• Federal: A multi-disciplinary team of seven North American universities and federal laboratories, led by Dr. Jeb Fields at the Louisiana State University Agricultural Center, is seeking input from growers and growing media manufacturers/suppliers across the continent, representing multiple sectors and demographics, to identify needed innovations and constraints when producing specialty crops with soilless substrates. The United States Department of Agriculture Specialty Crops Research Initiative awarded the researchers a planning grant, which the group plans to use to reimagine and redefine soilless substrate science to better meet the expanding range of crops and productions systems that are transitioning from traditional field soils into soilless substrates. Read more
• Colorado: The USDA’s National Institute of Food and Agriculture program has granted Colorado State University Pueblo $275,000 to develop its Industrial Hemp Education, Agriculture and Research (InHEAR) program. CSU Pueblo started offering a Bachelor of Science in Cannabis Biology and Chemistry degree this fall, and the grant will allow the school to expand this degree to include hemp agriculture beginning in the fall of 2021. Read more
• Massachusetts: A judge has sided with Cambridge, Mass., in the latest ruling in a lawsuit over the city’s cannabis ordinance, which bars existing medical cannabis operators from receiving adult-use cannabis licenses for two years in order to prioritize social equity applicants. Revolutionary Clinics, a licensed medical cannabis dispensary in Cambridge, sued the city over the two-year licensing delay, and while a judge sided with the company in January, Associate Justice Diana Maldonado has now ruled in favor of Cambridge. Read more
• Michigan: Michigan Gov. Gretchen Whitmer signed multiple “clean slate” bills into law this week that will automatically expunge criminal records for those convicted of certain cannabis-related offenses. The new law will automatically clear the records of those convicted of cannabis-related offenses that would not have been considered a crime after Dec. 6, 2018, when Michigan legalized adult-use cannabis, although it does not apply to felony convictions that carried a sentence of 10 years or more. Read more
• Missouri: The state is inching closer to launching its first medical cannabis sales as EKG Labs, the state’s first licensed testing facility, is testing cannabis for BeLeaf Medical, the state’s first licensed cultivator. BeLeaf co-founder John Curtis told St. Louis Public Radio that while the initial batch submitted to EKG is not large enough to stock dispensary shelves, he expects to send a second batch for testing and have product ready for sale at BeLeaf’s store within the next couple of weeks. Read more
• Mississippi: Gov. Tate Reeves has signed legislation that allows the state’s patients to access FDA-approved cannabis medications. The move comes weeks before voters head to the polls to decide on two competing ballot measures that would legalize medical cannabis in the state. Read more
• New Mexico: Ultra Health, a New Mexico cannabis company, has successfully filed a Writ of Mandamus against the New Mexico Department of Health (NMDOH) asking the court to rescind an NMDOH mandate that added additional requirements for reciprocal patients to participate in the New Mexico Medical Cannabis Program. Santa Fe District Court Judge Matthew Wilson prepared the Writ and signed it on Oct. 13, invalidating the NMDOH mandate and Emergency Rule that attempted to disallow qualified reciprocal participants from accessing New Mexico’s Medical Cannabis Program. Read more
• Illinois: The first eight months of adult-use cannabis sales in Illinois have generated more than $100 million in tax revenue. Total adult-use sales have reached more than $431 million since launching in January, reaching a new monthly record of nearly $68 million in September. Read more
• Washington, D.C.: D.C. councilmembers have introduced a bill that would allow returning citizens to work in the medical cannabis industry. The legislation would repeal a rule included in the Legalization of Marijuana for Medical Treatment Initiative of 1999 that prevents anyone with a felony conviction or misdemeanor cannabis offense from working at a medical cannabis cultivation center or dispensary. Read more
• International: Colombia’s legislature is discussing several initiatives that seek to regulate production and consumption of cannabis for recreational purposes among adults, and the Congress of Colombia has advanced two bills that would regulate adult-use cannabis. On Sept. 16, the first committee of the Lower House approved the first debate with a narrow vote of 18-17, allowing the first bill to move forward to the plenary of the Lower House. Separately, a group of 38 lawmakers of the opposition and the center-right parties led by Sens. Gustavo Bolivar and Luis Fernando Velasco submitted a second congressional bill that aims to regulate marijuana production and consumption. Read more