Cannabis News
Smartest Guys in the Room Go Belly Up in Canada
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1 year agoon
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Fire and Flower Throw in the Towel, Citing Significant Losses
An initial order for creditor protection has been granted by a Canadian court to Fire & Flower Holdings and its cannabis-related businesses due to significant net losses of more than $150 million ($200 million) that have accrued since 2018. The Companies Creditors Arrangement Act (CCAA) was used by the Ontario Superior Court of Justice to grant this order, which enables the company to continue operating as it currently is and interact with stakeholders to consider options for future business ventures. The court has also approved a debtor-in-possession loan of CA$ 9.8 million to Fire & Flower as part of this procedure. This credit was provided by an affiliate of Alimentation Couche-Tard, a significant Canadian convenience store chain and stockholder in the cannabis retailer.
Fire & Flower Seeks Solutions to Sustain Operations
In a recent news release, Fire & Flower emphasized the significance of creditor protection, which allows the company to collaborate with the monitor, FTI Consulting Canada. This collaboration aims to streamline operations and facilitate a court-supervised sales process, with the ultimate goal of obtaining a going concern for its operations and maximizing the value of its assets. By leveraging this strategic approach, Fire & Flower seeks to secure the continuity of its operations and navigate the challenging landscape it faces.
To support its operations during this process, Fire & Flower has been granted a debtor-in-possession loan of CA$ 9.8 million from an affiliate of Alimentation Couche-Tard, a major Canadian operator of convenience stores and an investor in the cannabis retailer. This financial support will fund the company’s operations and enable it to execute its plans effectively.
Fire & Flower is among a growing number of Canadian cannabis companies turning to Canada’s corporate insolvency law to address financial challenges. Notably, between January 1 and December 22, 2022, 14 out of the 35 Companies’ Creditors Arrangement Act (CCAA) filings in Canada involved companies operating in the cannabis industry in some capacity. With a network comprising more than 90 corporate-owned stores, Fire & Flower will employ approximately 618 full-time and 806 part-time employees by the end of 2022. Recognizing the need for additional funding to sustain its business, the company recently announced a comprehensive review of strategic options, including exploring various financing alternatives.
The Financial Challenges and Root Causes for Fire & Flower’s Losses
Management of Fire & Flower stressed in a regulatory filing dated May 15 that the company’s ability to continue as a going concern depended on crucial elements, including growing revenues, improving profitability and cash flows, and securing funding from debt, warrants, and other capital market alternatives. According to a news statement from the company, after careful consideration, the board decided that it would be best for Fire & Flower to apply for creditor protection under the Companies Creditors Arrangement Act (CCAA).
Fire & Flower attributed its substantial financial losses primarily to difficulties it encountered in its cannabis retail business. These difficulties included increased margin pressure, heightened competitiveness, and higher operational costs. Additionally, according to the company’s filing, the regulatory limits on the cannabis business have resulted in fewer sales and higher expenses than had been projected for their retail locations.
Annual losses have been disclosed by Fire & Flower since 2018. The company and its subsidiaries suffered losses of $45.4 million and $83.4 million, respectively, in the fiscal years ended January 29, 2022, and December 31, 2022. Also included in these net losses were more than CA$25.2 million for the fiscal year that ended on February 2, 2019, more than CA$35.6 million for the following year, and more than CA$17.5 million for the next year. Fire & Flower reported a net loss of over $8.7 million CA as of the quarter ending March 31, 2023.
Fire & Flower’s cash situation has worsened over the last two years. Cash held by the corporation and its subsidiaries as of January 30, 2021, was worth CA $30.6 million; this amount fell to CA $19.8 million a year later. According to their statement, as of March 31, 2023, the cash balance was only CA$ 8.2 million, while current liabilities totaled more than CA$ 50.8 million.
Among the subsidiaries cited in the court order were Hifyre, a digital retail and analytics platform; Friendly Stranger Holdings, which Fire & Flower purchased for roughly CA$24.6 million in 2020; Pineapple Express Delivery; and Pineapple Express Delivery, which Fire & Flower acquired for around CA$7.2 million in 2021. On the Toronto Stock Exchange, shares of Fire & Flower are traded under the ticker FAF.
Subsidiaries Affected by Fire & Flower’s Creditor Protection Order
Fire & Flower’s recent grant of creditor protection under the Companies Creditors Arrangement Act (CCAA) also has implications for its subsidiaries. The court order encompasses various entities associated with Fire & Flower, including Hifyre, Friendly Stranger Holdings, and Pineapple Express Delivery.
Hifyre, a digital retail and analytics platform, is one of the subsidiaries named in the court order. As Fire & Flower’s digital arm, Hifyre provides technological solutions for the cannabis retail industry. The company’s involvement in the creditor protection process raises questions about the impact on its operations and the potential for restructuring.
Friendly Stranger Holdings, which Fire & Flower acquired for approximately CA$24.6 million in 2020, is another subsidiary affected by the creditor protection order. Friendly Stranger Holdings is a well-known cannabis retailer in Canada, operating multiple stores nationwide. The implications of the order on Friendly Stranger Holdings raise concerns about the continuity of its operations and the potential impact on its employees and customers.
Additionally, Pineapple Express Delivery, acquired for around CA$ 7.2 million in 2021, is among the subsidiaries impacted by Fire & Flower’s creditor protection. Pineapple Express Delivery offers cannabis delivery services, and its inclusion in the court order raises questions about the future of its delivery operations and the potential for restructuring or consolidation.
The involvement of these subsidiaries underscores the interconnectedness of Fire & Flower’s business ecosystem. The creditor protection order’s impact on these entities must be carefully managed to ensure a comprehensive and coordinated approach to their respective operations, financial stability, and long-term viability.
As Fire & Flower and its subsidiaries navigate the creditor protection process, stakeholders, including employees, suppliers, and customers, will closely monitor developments to assess the potential implications for their relationships with the company and its subsidiaries. The outcome of the process will play a significant role in determining the future landscape of Fire & Flower’s subsidiary companies within the cannabis industry.
Bottom Line
Fire & Flower Holdings, a Canadian cannabis retailer, has obtained creditor protection following significant net losses of over $150 million since 2018. The company will continue operating under court supervision, exploring options with stakeholders for future ventures. A debtor-in-possession loan from Alimentation Couche-Tard’s affiliate will support ongoing operations. However, Fire & Flower’s financial challenges, including increased competition and regulatory constraints, have contributed to their losses. The creditor protection order also affects subsidiary companies, raising concerns about their viability. As developments unfold, the outcome of the process will shape the future of Fire & Flower and its subsidiaries in the cannabis industry.
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Latest Trump Weed Rumor – Trump Will Federally Deschedule and Decriminalize Cannabis, but Not Legalize It
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November 14, 2024By
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In a recent interview, former New Jersey Governor Chris Christie made headlines by asserting that President-elect Donald Trump will pursue significant reforms in federal policies regarding marijuana and cryptocurrency. As the nation grapples with evolving attitudes toward cannabis and the burgeoning digital currency market, Christie’s predictions have ignited discussions about the potential implications of such changes on both industries. This article delves into Christie’s insights, the current state of marijuana and cryptocurrency regulations, and the broader implications of these anticipated reforms.
The Current Landscape of Marijuana Legislation
Federal vs. State Laws
Marijuana remains classified as a Schedule I substance under the Controlled Substances Act (CSA), which places it in the same category as heroin and LSD. This classification has created a complex legal landscape where states have moved to legalize cannabis for medical and recreational use, while federal law continues to impose strict prohibitions. As of now, over 30 states have legalized marijuana in some form, leading to a burgeoning industry that generates billions in revenue.
Challenges Faced by the Cannabis Industry
Despite its legality in many states, the cannabis industry faces significant hurdles due to federal restrictions. These challenges include:
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Banking Access: Many banks are hesitant to work with cannabis businesses due to fear of federal repercussions, forcing these businesses to operate largely in cash.
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Taxation Issues: The IRS enforces Section 280E of the tax code, which prohibits businesses engaged in illegal activities from deducting normal business expenses, leading to disproportionately high tax burdens for cannabis companies.
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Interstate Commerce: The lack of federal legalization prevents cannabis businesses from operating across state lines, limiting their growth potential.
Chris Christie’s Perspective on Marijuana Reform
Christie, a former presidential candidate known for his tough stance on drugs during his tenure as governor, has evolved his views on marijuana over the years. In his recent statements, he emphasized that Trump is likely to pursue descheduling cannabis, which would remove it from the Schedule I classification. This move would not only provide clarity for businesses operating in legal markets but also open avenues for banking and investment.
Christie highlighted that descheduling would allow for a more regulated market where safety standards could be established, thus protecting consumers. He believes that this approach aligns with a growing consensus among Americans who support legalization and recognize the potential benefits of cannabis use for both medical and recreational purposes.
The Future of Cryptocurrency Regulation = The Rise of Cryptocurrencies
Cryptocurrencies have surged in popularity over the past decade, with Bitcoin leading the charge as the first decentralized digital currency. The market has expanded to include thousands of alternative coins (altcoins), each with unique features and use cases. As cryptocurrencies gain traction among investors and consumers alike, regulatory scrutiny has intensified.
Current Regulatory Challenges
The cryptocurrency market faces several regulatory challenges that hinder its growth and adoption:
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Lack of Clarity: Regulatory frameworks vary significantly across states and countries, creating confusion for investors and businesses.
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Fraud and Scams: The rapid growth of cryptocurrencies has led to an increase in fraudulent schemes targeting unsuspecting investors.
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Consumer Protection: Without clear regulations, consumers are often left vulnerable to risks associated with volatile markets.
Christie’s Vision for Crypto Regulation
Christie believes that under Trump’s leadership, there will be an effort to find a “sweet spot” for cryptocurrency regulation balancing innovation with consumer protection. He argues that overly stringent regulations could stifle growth in this emerging sector while too little oversight could expose consumers to significant risks.
In his view, a balanced regulatory framework would include:
1. Clear Definitions: Establishing clear definitions for different types of cryptocurrencies and tokens to differentiate between securities and utility tokens.
2. Consumer Protections: Implementing measures to protect investors from fraud while promoting transparency within the market.
3. Encouraging Innovation: Creating an environment conducive to innovation by allowing startups to thrive without excessive regulatory burdens.
Christie’s insights reflect a growing recognition among policymakers that cryptocurrencies are here to stay and that appropriate regulations are necessary to foster growth while safeguarding consumers.
Implications of Proposed Reforms
Economic Impact
The potential reforms proposed by Christie could have far-reaching economic implications:
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Job Creation: Legalizing marijuana at the federal level could lead to significant job creation within the cannabis industry—from cultivation and production to retail sales.
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Investment Opportunities: Descheduling cannabis would open up investment opportunities for institutional investors who have been hesitant due to federal restrictions.
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Boosting Local Economies: Legal cannabis markets have proven beneficial for local economies through increased tax revenues and job creation.
Similarly, clear regulations around cryptocurrencies could stimulate investment in blockchain technology and related industries, fostering innovation and economic growth.
Social Justice Considerations
Both marijuana legalization and sensible cryptocurrency regulations have social justice implications:
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Addressing Past Injustices: Legalizing marijuana could help rectify past injustices related to drug enforcement policies that disproportionately affected marginalized communities.
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Financial Inclusion: Cryptocurrencies offer opportunities for financial inclusion for those underserved by traditional banking systems, particularly in low-income communities.
Political Landscape
The political landscape surrounding these issues is complex. While there is bipartisan support for marijuana reform among certain lawmakers, challenges remain in overcoming entrenched opposition. Similarly, cryptocurrency regulation has garnered attention from both sides of the aisle but requires collaboration to establish effective frameworks.
Conclusion
Chris Christie’s predictions about President-elect Donald Trump’s approach to federal marijuana descheduling and cryptocurrency regulation suggest a potential shift in U.S. policy that could significantly reshape both industries. As public opinion evolves on these issues, lawmakers have an opportunity to enact meaningful reforms that promote economic growth while ensuring consumer protection. The anticipated changes could foster a more robust cannabis industry that contributes positively to the economy and addresses social justice concerns, while clear regulatory frameworks for cryptocurrencies could encourage innovation and protect consumers in the digital economy. Stakeholders in both sectors are closely watching these developments, eager to see how potential reforms might impact their futures. While the realization of Christie’s predictions remains uncertain, it’s clear that the conversation around marijuana and cryptocurrency regulation is ongoing and far from settled.
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Webinar Replay: Post-Election Cannabis Wrap – Smoke ’em if You’ve Got ’em
Published
1 day agoon
November 13, 2024By
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On Thursday, November 7th, Vince Sliwoski, Aaron Pelley and Fred Rocafort held a post election discussion “Post-Election Cannabis Wrap – Smoke ’em if You’ve Got ’em”. Watch the replay!
Key Takeaways from the “Smoke ’em if You’ve Got ’em – 2024 Post Election Cannabis Wrap” Webinar:
- Panelists:
- Vince Sliwoski: Oregon Business lawyer specializing in cannabis and commercial real estate.
- Aaron Pelley: Experienced in cannabis law since Washington’s legalization in 2012.
- Fred Rocafort: Trademark attorney working closely with the cannabis team.
- Election Results Overview:
- Most 2024 cannabis ballot measures did not pass.
- Florida, South Dakota, and North Dakota saw failures.
- Nebraska became the 39th state to legalize cannabis for medical use when it passed two cannabis initiatives, Initiatives 437 and 438.
- Federal and State-Level Developments:
- Medical use is currently legal in 38 states, and 24 states allow recreational use.
- Republican support for marijuana legalization is growing.
- Federal Policy Implications:
- Schedule III Rescheduling: The process to move cannabis to Schedule III is ongoing, which could significantly impact the industry.
- Importance of Federal Appointments: The future of cannabis policy depends heavily on who is appointed to key positions in the administration.
- International and Domestic Trade:
- Schedule III status could ease import/export restrictions on cannabis.
- Unified control of House, Senate, and presidency might expedite legislative progress.
- Economic and Industry Impact:
- Cannabis stocks experienced volatility post-election, reflecting investor uncertainty.
- Federal legalization and banking reforms are crucial for industry stability and growth.
- Future Outlook:
- The potential for federal rescheduling remains strong, with hearings scheduled for early 2025.
- State-level initiatives and regulatory developments will continue to shape the industry.
“How Long Does One Puff of Weed Stay in Your System?”… This topic can be difficult to answer since it is dependent on elements such as the size of the hit and what constitutes a “one hit.” If you take a large bong pull then cough, it might linger in your system for 5-7 days. A moderate dose from a joint can last 3-5 days, whereas a few hits from a vaporizer may last 1-3 days.
The length of time that marijuana stays in the body varies based on a number of factors, including metabolism, THC levels, frequency of use, and hydration.
Delta-9-tetrahydrocannabinol, or THC, is the primary psychoactive component of cannabis. THC and its metabolites, which remain in your body long after the effects have subsided, are detected by drug tests.
Since these metabolites are fat-soluble, they cling to bodily fat molecules. They could thus take a while to fully pass through your system, particularly if your body fat percentage is higher.
THC is absorbed by tissues and organs (including the brain, heart, and fat) and converted by the liver into chemicals such as 11-hydroxy-THC and carboxy-THC. Cannabis is eliminated in feces at a rate of around 65%, while urine accounts for 20%. The leftover amount might be kept within the body.
THC deposited in bodily tissues ultimately re-enters the circulation and is processed by the liver. For frequent users, THC accumulates in fatty tissues quicker than it can be removed, thus it may be detectable in drug tests for days or weeks following consumption.
The detection time varies according to the amount and frequency of cannabis usage. Higher dosages and regular usage result in longer detection times.
The type of drug test also affects detection windows. Blood and saliva tests typically detect cannabis metabolites for shorter periods, while urine and hair samples can reveal use for weeks or even months. In some cases, hair tests have detected cannabis use over 90 days after consumption.
Detection Windows for Various Cannabis Drug Tests
Urine Tests
Among all drug tests, urine testing is the most commonly used method for screening for drug use in an individual.
Detection times vary, but a 2017 review suggests the following windows for cannabis in urine after last use:
– Single-use (e.g., one joint): up to 3 days
– Moderate use (around 4 times a week): 5–7 days
– Chronic use (daily): 10–15 days
– Chronic heavy use (multiple times daily): over 30 days
Blood Tests
Blood tests generally detect recent cannabis use, typically within 2–12 hours after consumption. However, in cases of heavy use, cannabis has been detected up to 30 days later. Chronic heavy use can extend the detection period in the bloodstream.
Saliva Tests
THC can enter saliva through secondhand cannabis smoke, but THC metabolites are only present if you’ve personally smoked or ingested cannabis.
Saliva testing has a short detection window and can sometimes identify cannabis use on the same day. A 2020 review found that THC was detectable in the saliva of frequent users for up to 72 hours after use, and it may remain in saliva longer than in blood following recent use.
In areas where cannabis is illegal, saliva testing is often used for roadside screenings.
Hair Tests
Hair follicle tests can detect cannabis use for up to 90 days. After use, cannabinoids reach the hair follicles through small blood vessels and from sebum and sweat surrounding the hair.
Hair grows at approximately 0.5 inches per month, so a 1.5-inch segment of hair close to the scalp can reveal cannabis use over the past three months.
Factors Affecting THC and Metabolite Retention
The length of time THC and its metabolites stay in your system depends on various factors. Some, like body mass index (BMI) and metabolic rate, relate to individual body processing, not the drug itself.
Other factors are specific to cannabis use, including:
– Dosage: How much you consume
– Frequency: How often you use cannabis
– Method of consumption: Smoking, dabbing, edibles, or sublingual
– THC potency: Higher potency can extend detection time
Higher doses and more frequent use generally extend THC retention. Cannabis consumed orally may remain in the system slightly longer than smoked cannabis, and stronger cannabis strains, higher in THC, may also stay detectable for a longer period.
How Quickly Do the Effects of Cannabis Set In?
When smoking cannabis, effects appear almost immediately, while ingested cannabis may take 1–3 hours to peak.
The psychoactive component THC produces a “high” with common effects such as:
– Altered senses, including perception of time
– Mood changes
– Difficulty with thinking and problem-solving
– Impaired memory
Other short-term effects can include:
– Anxiety and confusion
– Decreased coordination
– Dry mouth and eyes
– Nausea or lightheadedness
– Trouble focusing
– Increased appetite
– Rapid heart rate
– Restlessness and sleepiness
In rare cases, high doses may lead to hallucinations, delusions, or acute psychosis.
Regular cannabis use may have additional mental and physical effects. While research is ongoing, cannabis use may increase the risk of:
– Cognitive issues like memory loss
– Cardiovascular problems including heart disease and stroke
– Respiratory illnesses such as bronchitis or lung infections
– Mood disorders like depression and anxiety
Cannabis use during pregnancy can negatively impact fetal growth and development.
Duration of Effects
Short-term effects generally taper off within 1–3 hours, but for chronic users, some long-term effects may last days, weeks, or even months. Certain effects may even be permanent.
Bottom Line
The amount of time that cannabis remains in your system following a single use varies greatly depending on individual characteristics such as body fat, metabolism, frequency of use, and mode of intake. Frequent users may maintain traces of THC for weeks, whereas infrequent users may test positive for as little as a few days. Hair tests can disclose usage for up to 90 days, while blood and saliva tests identify more recent use. Urine tests are the most popular and have varying detection durations. The duration that THC and its metabolites are detectable will ultimately depend on a number of factors, including dose, strength, and individual body chemistry.
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