Thriving Thursday Welcomes You!

Cannabis Capital Markets

TILT Holdings Inc. (CBOE: TILT, OTC: TLLTF) has entered into a Debt and Security Agreement with Smoore Technology Limited, enhancing their existing credit line. This agreement allows continued sales of CCELL vape hardware products to TILT’s subsidiary Jupiter Research, LLC. TILT has guaranteed Jupiter's payments to Smoore, secured by a first lien on TILT's assets. The arrangement supports TILT's business expansion and customer demand. Additionally, TILT aims to reduce its payable balance to Smoore to US$25 million by the end of 2024, with specific payment terms. The agreement includes standard covenants and provisions. TILT, based in Phoenix, Arizona, operates in technology, hardware, and cannabis production across multiple regions.

Aurora Cannabis Inc. (NASDAQ: ACB, TSX: ACB) announced it will hold its third quarter fiscal year 2024 investor conference call on February 8, 2024. The company expects to achieve positive annual Adjusted EBITDA and generate positive free cash flow in calendar 2024. Aurora also plans to consolidate its Common Shares on a 10 to 1 basis, effective around February 20, 2024, to comply with Nasdaq's Minimum Bid Price Requirement and maintain investor accessibility. The consolidation will reduce its current 475,903,822 outstanding shares to approximately 47,590,382. This move will not result in the issuance of fractional shares, and there will be adjustments to the terms of Aurora's convertible securities. Aurora focuses on medical and consumer cannabis products.

4Front Ventures Corp. (CSE: FFNT, OTC: FFNTF), a multi-state cannabis operator, has completed a debt-to-equity conversion with LI Lending, LLC, converting approximately $USD 23,000,000 of debt into class A subordinate voting shares at $CAD 0.125 per share. This move, aimed at strengthening the company’s balance sheet, reduces its senior secured debt and enhances financial flexibility. The agreement also includes a restricted stock unit for the lender to maintain ownership percentage and a 15% warrant coverage at a premium exercise price. The company's Board of Directors has capped their remuneration, opting for payment in restricted stock units, aligning with long-term shareholder value creation goals. 4Front Ventures operates in the U.S. cannabis industry, focusing on cultivation, production, and retail.

Village Farms International, Inc. (NASDAQ: VFF) is constructing its first indoor cannabis facility in Drachten, Netherlands. This is part of the Dutch Closed Supply Chain Experiment, where the company's subsidiary, Leli Holland, is one of 10 licensed producers. The Drachten facility is set to produce 2,500 kg of dried flower annually, starting in late 2024. A larger facility in Groningen with a 10,000 kg capacity is planned for 2026. CEO Michael DeGiglio sees the Netherlands as vital for the company's global cannabis strategy, due to the country's established market and favorable regulations. The Drachten project will be financed using existing funds, drawing on Village Farms' Canadian cannabis market experience. The Dutch Program, a government initiative, is testing regulated cannabis supply to coffeeshops, which could lead to nationwide legalization. Village Farms, experienced in Controlled Environment Agriculture, is broadening its international presence in the cannabis and CBD sectors.

Organigram Holdings Inc. (NASDAQ: OGI, TSX: OGI) has shipped its first bulk dried flower to Germany's Sanity Group, marking its entry into the German medical cannabis market. This shipment is part of a multi-year agreement with Sanity Group.

Cannabis Policy

In Virginia the Senate Courts of Justice Committee has advanced two cannabis bills: one legalizing retail marijuana sales (SB 448) and another for resentencing individuals with cannabis-related convictions (SB 696). SB 448, led by Sen. Aaron Rouse, proposes licensing adult-use marijuana businesses from this year, with retail licenses available by 2025. SB 696, introduced by Sen. Angelia Williams Graves, aims to provide resentencing for those incarcerated for marijuana offenses. These bills follow the 2021 legalization of adult-use cannabis in Virginia and address establishing a legal market and addressing past convictions. The bills are now progressing to the Senate Finance and Appropriations Committee for further consideration. 

In Texas Attorney General Ken Paxton (R) is suing five cities over voter-approved local marijuana decriminalization laws, alleging they conflict with state law and promote drug use. The lawsuit challenges measures that limit police action on minor cannabis offenses, amidst broader decriminalization efforts in Texas. Advocacy groups contend these local laws address biased law enforcement and resource allocation. The action follows failed attempts by the Texas House to pass similar statewide reforms and occurs in a context where public support for marijuana decriminalization is notably high in Texas.

In New York Governor Kathy Hochul has criticized the state's marijuana legalization process as inefficient and problematic, particularly highlighting the slow pace of licensing and the growth of unlicensed dispensaries. She believes the law lacks effective enforcement against the illicit market and has issues with the Office of Cannabis Management and Cannabis Control Board's structure. Hochul acknowledges delays due to legal challenges and is skeptical about the legislature's willingness to significantly revise the law. Her focus is on enhancing enforcement and making the regulated market more competitive, even as the state considers measures to empower local governments to address unlicensed cannabis businesses. Despite these difficulties, New York recently saw an increase in licensed cannabis retailers.

Psychedelics

In California the Assembly unanimously approved a bill by Assembly member Marie Waldron (R) to create a state workgroup under the California Health and Human Services Agency for developing a regulatory framework for therapeutic access to psychedelics. The bill, AB 941, passed with a 58-0 vote and now heads to the Senate. It focuses on studying psychedelic-assisted therapy to address mental health issues but does not authorize immediate treatment. Waldron is also working with Sen. Scott Wiener (D) on a broader proposal for psychedelic therapy access. This initiative follows Gov. Gavin Newsom's veto of a previous bill, with a preference for a therapeutic-focused approach. The current bill serves as a preparatory step for the more comprehensive legislation being developed.

Filament Health Corp. (OTCQB: FLHLF, CBOE CA: FH), a drug development company, announced that the U.S. FDA has accepted its IND application for PEX010, a psilocybin-based drug for treating Substance Use Disorders. This clearance enables U.S. research, complementing ongoing Canadian studies for Opioid Use Disorder. The drug is also under study by various institutions for conditions like alcohol use disorder, depression, and coma.

Cryptocurrency

FTX, a cryptocurrency exchange founded by Sam Bankman-Fried, has scrapped plans to restart and will liquidate assets to repay customers. The decision, revealed in a Delaware bankruptcy court by FTX attorney Andy Dietderich, comes after failed negotiations with potential investors. Bankman-Fried, convicted of fraud, has been accused of mismanaging the company, leading to its bankruptcy in November 2022. FTX has amassed over $7 billion for customer repayment, calculated based on November 2022's cryptocurrency values, which has caused customer complaints due to price increases since then. Bankman-Fried's fraudulent activities, which involved misusing customer funds, resulted in a significant financial shortfall for FTX and its customers. Read all about it on the TDR Website!

Ripple's XRP token value dropped by over 5% following rumors of a network breach involving $112.5 million. Ripple Executive Chairman Chris Larsen confirmed the breach was limited to his personal XRP accounts, not the Ripple network. The issue was promptly addressed, and exchanges were alerted to freeze the affected addresses. The incident, initially reported by blockchain analyst ZachXBT, involved the theft and laundering of 213 million XRP tokens.

GSR, a crypto trading firm and digital asset market maker, has appointed Andreas Koukorinis, a former JPMorgan executive, as its new head of trading. This move is part of GSR's strategy to attract more conservative clients, focusing on major cryptocurrencies like bitcoin (BTC) and ether (ETH). Koukorinis, who previously led global algorithmic credit trading at JPMorgan, will now oversee GSR's trading platform and strategy, catering to a diverse clientele including token issuers, institutional investors, and family offices. The appointment comes at a time when digital asset markets are increasingly intersecting with traditional finance, evidenced by Wall Street firms issuing bitcoin ETFs and global banks exploring asset tokenization. Koukorinis' role will be crucial in shaping GSR's position in the evolving market infrastructure for digital assets. 

AI

In response to AI-generated nonconsensual sexualized images of Taylor Swift circulating on social media, the "Defiance Act" or the Disrupt Explicit Forged Images and Non-Consensual Edits Act of 2024, was introduced by a bipartisan group of US senators. This bill criminalizes the creation and distribution of such content, allowing victims to seek civil penalties against those responsible. The legislation targets the issue of deepfake pornography and provides legal protections against digital forgeries. Read all the details on the TDR website!

The UK and Canada have entered a Memorandum of Understanding to jointly enhance AI research by focusing on computing power. This agreement, signed by UK Technology Secretary Michelle Donelan and Canadian Minister François-Phillippe Champagne, aims to provide accessible high-powered computing for AI development. It's part of a larger science and technology partnership between the two countries, emphasizing collaboration in areas like quantum computing, AI, and clean energy. The initiative also includes investments in various joint research projects and reinforces the commitment of both nations to technological innovation in AI.

According to The Guardian, a Higher Education Policy Institute survey shows over half of UK undergraduates use AI for essay writing, and teachers are exploring its use in lesson planning. The Education Endowment Foundation is assessing AI's impact on teaching quality and workload reduction in secondary schools. Dr. Andres Guadamuz of the Institute stresses the importance of educating students about AI's limitations and misinformation risks, underscoring the need for clear guidelines amid rising AI use in education.

TDR University – Lessons of Trends vs Reality

At TDR University's "Trends vs Reality" session, we dissect financial reports using a family hike analogy. Learn why it's crucial to look beyond initial data, understand the real weight of progress, and compare absolute results for a true picture of a company's financial health.Read all about it on the TDR Website!

Did you see this yesterday?

Join us for yesterday’s episode of "Trade To Black" which covers key cannabis industry topics: Israel's investigation into Canadian cannabis firms, U.S. Senators advocating marijuana descheduling, Virginia's progress towards regulated recreational cannabis, and AYR Wellness's debt restructuring. Tune in for detailed insights on these developments.

TDR Mythbusters - How Cannabis Truly Affects Your Sleep?