OAKLAND, Calif. and TORONTO, June 8, 2020 /CNW/ -PRESS RELEASE- Harborside Inc., a California-focused, Toronto-based, vertically integrated cannabis enterprise, announced June 8 an update to its previously disclosed application to the Ontario Securities Commission (OSC) for a management cease trade order (MCTO). As announced on April 23, 2020, Harborside continues to expect to report revenue of approximately $50 million and negative adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) for its fiscal year ended Dec. 31, 2019, and revenue of approximately $14 million and positive adjusted EBITDA for its first quarter ended March 31, 2020.
The OSC has agreed to grant Harborside a MCTO in respect of its previously announced delayed filing of its audited annual financial statements and corresponding management's discussion and analysis for the year ended Dec. 31, 2019 due to the continued impact of COVID-19. The MCTO in respect of the annual filings lasts for 30 days from the filing deadline of June 15, 2020. Harborside intends to file no later than July 10, 2020.
In addition, the OSC issued a temporary cease trade order in connection with Harborside's previously announced proposed refiling of certain historical financial statements for the fiscal years ended Dec. 31, 2017 and 2018, and the interim periods ended March 31, 2019, June 30, 2019, and Sept. 30, 2019, and any corresponding management's discussion and analyses due primarily to changes in the application of accounting treatments related to certain transactions by its reverse takeover acquirer, FLRish Inc., Harborside does not expect there to be a fundamental change to its current financial position as a result of the refiling of the restated documents. The temporary order prevents trading in Harborside’s subordinate voting shares effective immediately and will expire after 15 days. If the company is unable to re-file the restated documents by June 22, 2020, a permanent cease trade order will be issued by the OSC.
Harborside anticipates that the temporary order (or any permanent cease trade order) will be revoked if the company has filed its audited financial statements for the fiscal years ended Dec. 31, 2017, 2018 and 2019, following which an MCTO may be issued for any outstanding restated documents for a period of up to 30 days.
Harborside will release an update once the filings have been made.
