Cannabis media firm Hightimes Holding Corp. in April purchased West Hollywood, California consumption lounge The Mezz for $6 million, including $1,500,000 in convertible promissory notes and $4,500,000 of Hightimes Class A common stock, according to Green Market Report. However, since the company hasn’t published financial information in three years, the shares don’t trade – and potentially could never trade – so the value of the stock is effectively zero.
The deal still requires regulatory approval.
High Times also entered into a management services agreement with The Mezz to provide certain support services to the lounge, so even if the sale is not approved, High Times will get some income from the agreement.
According to Green Market, The Mezz is behind on its rent, owing more than $1 million total; the base rent is $35,000 a month. In May, the company paid an additional security deposit of $126,624 plus $42,208 in rent as part of an agreement with the lessor.
In May, High Times investors shared on Reddit that their stock was worth $0. In July 2020, the U.S. Securities and Exchange Commission (SEC) told High Times to halt its initial public offering after it missed a deadline to file its annual audited report. The company launched its Reg A offering in 2018 and in the following years, High Times started acquiring magazines, online publications, events that centered around cannabis culture, and cannabis retail companies.
High Times issued its last annual report in June 2019, which showed it had raised just $15 million of its $50 million goal. In a 2019 SEC report, Hightimes Holding had a net loss of $11.9 million on revenue of $10.7 million for the six months ending on June 30, 2019. The company at the time reported $105.2 million in debts.
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