BLUM HOLDINGS, INC. Completes Acquisition

TL;DR

BLUM HOLDINGS just closed a deal, likely an acquisition. Details to follow.

AI Summary

On June 10, 2024, BLUM HOLDINGS, INC. reported the completion of an acquisition. The filing indicates the entry into a material definitive agreement and the completion of an acquisition or disposition of assets. Specific details regarding the acquired entity or the financial terms of the transaction were not immediately available in this initial filing.

Why It Matters

This filing signals a significant corporate action for BLUM HOLDINGS, INC., indicating growth or strategic expansion through the acquisition of assets or another company.

Risk Assessment

Risk Level: medium — Acquisitions carry inherent risks related to integration, valuation, and potential undisclosed liabilities, but the filing itself doesn't detail specific risks.

Key Players & Entities

• BLUM HOLDINGS, INC. (company) — Registrant
• June 10, 2024 (date) — Date of earliest event reported

FAQ

Key Financial Figures

• $24.8 million — the total transaction consideration was $24.8 million. Pursuant to the MIPA, Haven Nectar acq
• $9.0 million — of People's. The consideration includes $9.0 million in cash (the "Cash Consideration") and
• $8.0 million — he Cash Consideration is in the form of $8.0 million paid in cash at closing and a $1.0 mill
• $1.0 million — 0 million paid in cash at closing and a $1.0 million secured promissory note to be paid over
• $5.53 million — n. The PFC liabilities are comprised of $5.53 million in accounts payable and accrued liabili
• $8.59 million — nts payable and accrued liabilities and $8.59 million in income tax payable, and pursuant to
• $1.03 million — me tax payable, and pursuant to US GAAP $1.03 million in Tax Provision and $0.69 million in L
• $0.69 million — GAAP $1.03 million in Tax Provision and $0.69 million in Lease Liabilities, for an aggregate
• $15.84 million — Lease Liabilities, for an aggregate of $15.84 million in liabilities. As a result of the sal
• $44.46 million — tinguishment of liabilities expected is $44.46 million based on pro forma estimates from the C
• $5.64 million — 024, which liabilities are comprised of $5.64 million in total accounts payable and accrued l
• $23.89 million — s, $8.59 million in income tax payable, $23.89 million in promissory notes and accrued interes
• $5.31 million — promissory notes and accrued interest, $5.31 million in lease liabilities, and $1.03 million
• $33.98 million — estimated gain from the sale of PFC is $33.98 million or $3.09 per Common Share based on esti
• $3.09 — om the sale of PFC is $33.98 million or $3.09 per Common Share based on estimates inc

Filing Documents

• blmh20240531_8k.htm (8-K) — 40KB
• ex_687358.htm (EX-10.1) — 300KB
• ex_687359.htm (EX-10.2) — 78KB
• ex_687360.htm (EX-10.3) — 74KB
• ex_685106.htm (EX-99.1) — 285KB
• 0001437749-24-020319.txt ( ) — 995KB
• blmh-20240610.xsd (EX-101.SCH) — 3KB
• blmh-20240610_def.xml (EX-101.DEF) — 10KB
• blmh-20240610_lab.xml (EX-101.LAB) — 14KB
• blmh-20240610_pre.xml (EX-101.PRE) — 10KB
• blmh20240531_8k_htm.xml (XML) — 2KB

01. Entry into a Material Definitive Agreement

Item 1.01. Entry into a Material Definitive Agreement. On June 10, 2024, Unrivaled Brands, Inc. ("Unrivaled"), a wholly owned subsidiary of Blum Holdings, Inc. (the "Company"), entered into a Membership Interest Purchase Agreement (the "MIPA") and simultaneously completed the sale (the "Disposition") of its controlling membership interest in People's First Choice, LLC ("PFC") to Haven Nectar, LLC ("Haven Nectar"). Haven Nectar is a recently formed entity owned and controlled by Mr. Shubham Pandey. PFC owns and operates a cannabis retail dispensary campus in Santa Ana, California named Blm Santa Ana. In connection with the MIPA, People's California, LLC ("Peoples"), sold its minority interest in PFC to Haven Nectar. Based on estimates included in the unaudited pro forma condensed consolidated financial statements for the period ended March 31, 2024, the total transaction consideration was $24.8 million. Pursuant to the MIPA, Haven Nectar acquired the 80% membership interests of Unrivaled and the 20% membership interests of People's. The consideration includes $9.0 million in cash (the "Cash Consideration") and the assumption of PFC's liabilities ("PFC's Liabilities"). The Cash Consideration is in the form of $8.0 million paid in cash at closing and a $1.0 million secured promissory note to be paid over 12 months. The Cash Consideration was paid to People's for settlement of the debt pursuant to the binding settlement term sheet between Unrivaled and People's entered into on March 6, 2023 (the "Settlement Term Sheet"). As a result of the sale and pursuant to the terms of the Settlement Term Sheet, after the Cash Consideration, the remaining debt to People's is settled, subject to any deficiencies as defined therein. The PFC liabilities are comprised of $5.53 million in accounts payable and accrued liabilities and $8.59 million in income tax payable, and pursuant to US GAAP $1.03 million in Tax Provision and $0.69 million in Lease Liabilities, for an aggregate of $

01. Completion of Acquisition or Disposition of Assets

Item 2.01. Completion of Acquisition or Disposition of Assets. The information under Item 1.01, above, is incorporated herein by reference. The unaudited pro forma condensed consolidated financial information of the Company, together with the related notes thereto, giving effect to the consummation of the Disposition of People's First Choice LLC is filed as Exhibit 99.1 to this Current Report on Form 8-K and incorporated herein by reference.

01. Financial Statements and Exhibits

Item 9.01. Financial Statements and Exhibits. (b) Pro Forma Financial Information. The following unaudited pro forma financial information is filed as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated herein by reference: Unaudited pro forma condensed consolidated balance sheet as of March 31, 2024; and Unaudited pro forma condensed consolidated statements of operations for the three months ended March 31, 2024 and for the year ended December 31, 2023. (d) Exhibits. Exhibit Description 10.1 Membership Interest Purchase Agreement. 10.2 Transition Services Agreement 10.3 Trademark License Agreement 99.1 Unaudited Pro Forma Condensed Consolidated Financial Statements of Blum Holdings, Inc. 104 Cover Page Interactive Data File (embedded within the Inline XBRL Document). 2

SIGNATURES

SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. BLUM HOLDINGS, INC. Date: June 14, 2024 By: /s/ Sabas Carrillo Sabas Carrillo Chief Executive Officer 3

View Full Filing

View this 8-K filing on SEC EDGAR