Pursuant to the Urbn Leaf Lock-Up Agreement, the Urbn Leaf Locked-Up Shareholders will agree not to sell, assign or otherwise transfer the Harborside SVS received. The restrictions lapse in three installments with each one-third of the shares released from the restrictions on the 6-month, 12-month and 18-month anniversaries from the closing of the Urbn Leaf Transaction. Harborside is currently a publicly listed company on the Canadian Securities Exchange (“CSE”) trading under the ticker symbol “HBOR” and on the OTCQX Best Market under the ticker symbol “HBORF”. The Company sells its Fuzzies, Sublime, KEY and Harborside Farms branded consumer products through third party retailers and delivery outlets across the state of California, as well as in its own stores. Harborside has played an instrumental role in making cannabis safe and accessible to a broad and diverse community of California consumers since 2006, when it was awarded one of the first six cannabis licenses granted in the United States.
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Harborside Inn fire: Block Island, Rhode Island, demolition set for September - The Boston Globe
Harborside Inn fire: Block Island, Rhode Island, demolition set for September.
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The Company's new CUSIP number for its Common Shares will be 85754G301 and its new ISIN number will be CA85754G3017 upon completion of the Name Change and the Reclassification. Contributing original content and curating quality news on only the most promising cannabis companies and the most influential investors. A decade of hard work paid off on January 1, 2018, when DeAngelo, sold the first gram of legal cannabis to an adult in California. This historic event marked the end of prohibition and the birth of the modern cannabis industry. Founded in 2006 by industry Veterans and activists Steve Deangelo and Dress Wedding, Harborside is a vertically integrated California Cannabis Business with retail locations in Oakland, San Jose, San Leandro, San Francisco, and Desert Hot Springs. Ducera Partners LLC and Beacon Securities Limited acted as financial advisor and Feuerstein Kulick LLP acted as United States legal counsel to Loudpack.
Concurrent Financing
The Board will continue to monitor market conditions carefully and could proceed with the Consolidation at a later date if it determines that such a decision is in the best interests of shareholders. Depending on the timing of the implementation of such Consolidation, shareholder approval may be required in order to effect the Consolidation. The cannabis industry in California has reached an important tipping point, and with the collective strengths of these three companies and the benefits of integration, we have the right combination of assets and skills to set a new standard, offering consumers the widest variety of products with best-in-class customer service. The Transactions are expected to close in the first half of 2022, subject to approval by Harborside shareholders, the CSE, regulatory approval and customary closing conditions.
“The Best Dispensary In California.”
Reconciliations of the supplemental non-IFRS measures are presented in the Company's management's discussion and analysis for the period ended September 30, 2021. These non-IFRS financial measures are presented because management has evaluated the financial results both including and excluding the adjusted items and believes that the non-IFRS financial measures presented provide additional perspective and insights when analyzing the core operating performance of the business. The Company believes that these supplemental measures provide information which is useful to shareholders and investors in understanding our performance and may assist in the evaluation of the Company's business relative to that of its peers. The Loudpack Agreement provides for, among other things, customary representations and warranties and covenants, including mutual non-solicitation provisions and a US$5.0 million termination fee payable by either the Company or Loudpack in certain circumstances. About Harborside (to be renamed StateHouse)Harborside, a vertically integrated enterprise with cannabis licenses covering retail, major brands, distribution, cultivation, nursery and manufacturing, is one of the oldest and most respected cannabis companies in California.
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Urbn Leaf prepares their financial statements in accordance with Generally Accepted Accounting Principles (GAAP) in the United States. Sublime for the period prior to acquisition by Harborside on July 2, 2021 prepared their financial statements in accordance with Generally Accepted Accounting Principles (GAAP) in the United States. Effective upon the market open on July 25, 2022, the stock will trade on the Canadian Securities Exchange under the new ticker symbol "STHZ.". The Name Change was overwhelmingly approved by shareholders of the Company at a special meeting (the "Meeting") held on February 22, 2022. The new corporate website statehouseholdings.com will launch on that date with additional information about the Company and its go-forward strategy.
Cannabis for all
Founded in 2006, Harborside was awarded one of the first six medical cannabis licenses granted in the United States. Today, the Company operates 14 dispensaries covering Northern and Southern California and one in Oregon, distribution facilities in San Jose and Los Angeles, California and integrated cultivation/production facilities in Salinas and Greenfield, California. Harborside is a publicly listed company, currently trading on the Canadian Securities Exchange ("CSE") under the ticker symbol "HBOR" and the OTCQX under the ticker symbol "HBORF". The Company continues to play an instrumental role in making cannabis safe and accessible to a broad and diverse community of California and Oregon consumers. There are no comparable IFRS financial measures presented in Harborside’s financial statements. Reconciliations of the supplemental non-IFRS measures are presented in the Company’s management’s discussion and analysis for the period ended September 30, 2021.
Pursuant to the terms of the Definitive Agreement with respect to the Loudpack Transaction (the “Loudpack Agreement”), Harborside will acquire all of the equity interest of Loudpack through the issuance of approximately 91,427,786 SVS, subject to adjustment, 2,000,000 warrants and the assumption and restructuring of debts. Ducera Partners LLC and Beacon Securities Limited acted as financial advisor and Feuerstein Kulick LLP acted as United States legal counsel to Loudpack. PGP Capital Advisors, LLC acted as financial advisor and Burns & Levinson LLP acted as United States legal counsel to Urbn Leaf. Cassels Brock & Blackwell LLP acted as Canadian legal counsel and Duane Morris LLP acted as United States legal counsel to Harborside.
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The aggregate consideration for the Transactions will be met through the issuance of 151,427,786 subordinate voting shares of Harborside ("SVS") and the assumption and restructuring of debts and other obligations as well as the issuance of 2,000,000 warrants at a strike price of US$2.50 per SVS (the "Warrants"). Harborside, Urbn Leaf and Loudpack noted that the structure of the transaction and overall consideration contemplates both a return to normalized enterprise valuations for California-focused cannabis companies and the potential for StateHouse to become a leading participant in that market. Based upon the relative enterprise value of each party, following closing of the Transactions, existing Harborside, Loudpack and Urbn Leaf shareholders will own approximately 35%, 39% and 26% of StateHouse, respectively, on a fully diluted basis and assuming conversion of all multiple voting shares of Harborside ("MVS") to SVS.
What are the check-in and check-out times at Harborside Atlantis?
Harborside is currently a publicly listed company on the Canadian Securities Exchange ("CSE") trading under the ticker symbol "HBOR" and on the OTCQX Best Market under the ticker symbol "HBORF". The Urbn Leaf Transaction has been unanimously approved by the board of directors of Urbn Leaf. The directors and officers and certain shareholders of Urbn Leaf, collectively holding approximately 69% of Series A shares and 96% of common shares, have entered into voting and support agreements to vote in favour of the Urbn Leaf Transaction. In addition, concurrent with the closing of the Urbn Leaf Transaction, the Company will enter into a lock-up agreement with certain shareholders of Urbn Leaf (the "Urbn Leaf Locked-Up Shareholders") in respect of the Harborside SVS to be received by such shareholders pursuant to the Urbn Leaf Transaction (the "Urbn Leaf Lock-Up Agreement").
These non-IFRS financial measures should not be considered superior to, as a substitute for, or as an alternative to, and should be considered in conjunction with, the IFRS financial measures presented in the Company’s financial statements. For more information, please see “Use of Non-IFRS Measures” and “Non-IFRS Measures” in the Company’s management’s discussion and analysis for the period ended September 30, 2021, which is available under the Company’s profile on Harborside’s board of directors has unanimously approved the Transactions and has unanimously resolved to recommend that the shareholders of Harborside vote in favour of the Transactions.
Current cultivation capacity assumes increased plant density at the Salinas facility with consistent yields. Additional near-term cultivation capacity assumes completion of two additional greenhouses that are partially completed at our Salinas facility. For fact-based information on The Harborside Group, view the company’s sponsored Investor Dashboard. Visit the Harborside Investor Dashboard and stay up to date with data-driven, fact based due diligence for active traders and investors.
In addition, concurrent with the closing of the Urbn Leaf Transaction, the Company will enter into a lock-up agreement with certain shareholders of Urbn Leaf (the “Urbn Leaf Locked-Up Shareholders”) in respect of the Harborside SVS to be received by such shareholders pursuant to the Urbn Leaf Transaction (the “Urbn Leaf Lock-Up Agreement”). All of the voting members of the sole stockholder of Loudpack have entered into a voting and support agreement to vote in favour of the Loudpack Transaction. In addition, concurrent with the closing of the Loudpack Transaction, the Company will enter into a lock-up agreement with the sole stockholder of Loudpack in respect of the Harborside SVS to be received pursuant to the Loudpack Transaction (the "Loudpack Lock-Up Agreement"). Pursuant to the Loudpack Lock-Up Agreement, Loudpack's sole stockholder will agree not to sell, assign or otherwise transfer the Harborside SVS received, except to its members, who will be required to enter into equivalent lock-up agreements. The restrictions lapse in three installments with each one-third of the shares released from the restrictions on the 6-month, 12-month and 18-month anniversaries from the closing of the Loudpack Transaction. In addition, concurrent with the closing of the Loudpack Transaction, the Company will enter into a lock-up agreement with the sole stockholder of Loudpack in respect of the Harborside SVS to be received pursuant to the Loudpack Transaction (the “Loudpack Lock-Up Agreement”).
PI Financial Corp. has provided fairness opinions to the board of directors of Harborside that, subject to the assumptions, limitations and qualifications set out in each such fairness opinion, the consideration to be paid by Harborside shareholders pursuant to the Transactions is fair from a financial point of view to Harborside's shareholders. "The cannabis industry in California has reached an important tipping point, and with the collective strengths of these three companies and the benefits of integration, we have the right combination of assets and skills to set a new standard, offering consumers the widest variety of products with best-in-class customer service," said Mr. Schmults. In connection with the Transactions, management has entered into a letter of intent with Pelorus Equity Group to complete the Real Estate Financing (as defined below) of US$77.3 million of non-dilutive real estate debt financing, which unlocks significant value from the StateHouse real estate portfolio and provides significant growth capital for the business. SHARE CONSOLIDATIONAfter careful consideration, the Board has elected not to proceed with the consolidation of its issued and outstanding SVS (the "Consolidation") on a six-for-one basis at this time.
Harborside's board of directors has unanimously approved the Transactions and has unanimously resolved to recommend that the shareholders of Harborside vote in favour of the Transactions. In addition, all directors and executive officers, as well as certain shareholders of Harborside, collectively holding approximately 27% of the Harborside voting interest, have indicated their intention to vote in favor of both the Loudpack Transaction and the Urbn Leaf Transaction. "We are very pleased with the changes to the Company's equity capitalization that have now resulted in a 'one share - one vote' structure," added Mr. Schmults. "This streamlined structure is part of a broader strategy designed to create a company that treats all shareholders equally, attracts institutional investors, and reflects our goal of being the premier investment vehicle in the California cannabis industry."
The Warrants will be exercisable to purchase SVS at a price of US$2.50 per SVS, anytime within 5 years of the closing date. Harborside will have the option to accelerate the expiration date of the Warrants in the event that the volume weighted average trading price of the SVS is equal to or greater than US$5.00. Neither the CSE nor its Market Regulator (as that term is defined in the policies of the CSE) accepts responsibility for the adequacy or accuracy of this release. SHARE RECLASSIFICATIONThe Company's SVS will be reclassified as Common Shares, effective July 25, 2022. The Reclassification is attributable to the mandatory conversion of Harborside multiple voting shares into SVS (the "Mandatory Conversion"), which was completed on March 31, 2022. Due to the Mandatory Conversion, there is now just a single class of StateHouse shares and no need for a designation other than Common Shares to describe such shares outstanding.
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