TREES Corp Files 10-Q for Period Ending March 31, 2024

TL;DR

<b>TREES Corp (Colorado) has filed its quarterly report (10-Q) for the period ending March 31, 2024, detailing its financial status and corporate information.</b>

AI Summary

TREES Corp (Colorado) (CANN) filed a Quarterly Report (10-Q) with the SEC on May 14, 2024. TREES Corp (Colorado) filed a 10-Q quarterly report for the period ending March 31, 2024. The company's principal executive offices are located at 215 Union Boulevard, Suite 415, Lakewood, CO 80228. TREES Corp was formerly known as GENERAL CANNABIS CORP and Advanced Cannabis Solutions, Inc. The company is incorporated in Colorado and has an IRS Employer Identification No. of 90-1072649. TREES Corp is classified as a smaller reporting company and a non-accelerated filer.

Why It Matters

For investors and stakeholders tracking TREES Corp (Colorado), this filing contains several important signals. This filing provides investors with an update on TREES Corp's financial performance and operational status for the first quarter of 2024. Understanding the company's historical name changes and current reporting status (smaller reporting company, non-accelerated filer) is crucial for assessing its regulatory compliance and investment profile.

Risk Assessment

Risk Level: low — TREES Corp (Colorado) shows low risk based on this filing. The filing is a standard 10-Q, indicating routine reporting without immediate red flags, and the company is classified as a smaller reporting company, suggesting lower complexity and scrutiny.

Analyst Insight

Monitor future 10-Q filings for specific financial performance metrics and operational updates from TREES Corp.

Key Numbers

• 2024-03-31 — Quarterly Period End Date (10-Q filing)
• 2024-05-14 — Filing Date (10-Q filing)
• 000-54457 — Commission File Number (SEC registration)
• 90-1072649 — IRS Employer Identification No. (Company identifier)

Key Players & Entities

• TREES Corp (Colorado) (company) — Filer name
• March 31, 2024 (date) — Quarterly period ended
• 215 Union Boulevard, Suite 415, Lakewood, CO 80228 (address) — Principal executive offices
• GENERAL CANNABIS CORP (company) — Former company name
• Advanced Cannabis Solutions, Inc. (company) — Former company name
• Colorado (location) — State of incorporation
• 90-1072649 (identifier) — IRS Employer Identification No.
• 000-54457 (identifier) — Commission file number

FAQ

Key Dates

• 2024-03-31: Quarterly period end — End of the reporting period for the 10-Q filing.
• 2024-05-14: Filing date — Date the 10-Q report was officially filed with the SEC.

Glossary

10-Q

A quarterly report required by the U.S. Securities and Exchange Commission (SEC) from companies with securities registered under the Securities Exchange Act of 1934. (This filing provides an update on the company's financial performance and condition for the specified quarter.)

Smaller reporting company

A company that meets certain criteria related to public float and annual revenues, allowing for scaled disclosure requirements. (Indicates TREES Corp is subject to less stringent reporting obligations compared to larger companies.)

Non-accelerated filer

A filer that does not meet the criteria for large accelerated filer or accelerated filer status. (Suggests the company is not subject to the same internal control attestation requirements as accelerated filers.)

Filing Documents

• ea0205856-10q_trees.htm (10-Q) — 499KB
• ea020585601ex31-1_treescorp.htm (EX-31.1) — 7KB
• ea020585601ex31-2_treescorp.htm (EX-31.2) — 7KB
• ea020585601ex32-1_treescorp.htm (EX-32.1) — 4KB
• 0001213900-24-042976.txt (&nbsp;) — 3900KB
• cann-20240331.xsd (EX-101.SCH) — 40KB
• cann-20240331_cal.xml (EX-101.CAL) — 39KB
• cann-20240331_def.xml (EX-101.DEF) — 210KB
• cann-20240331_lab.xml (EX-101.LAB) — 383KB
• cann-20240331_pre.xml (EX-101.PRE) — 206KB
• ea0205856-10q_trees_htm.xml (XML) — 365KB

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION 1 Item 1.

Financial Statements

Financial Statements 1 Item 2.

Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's Discussion and Analysis of Financial Condition and Results of Operations 12 Item 3.

Quantitative and Qualitative Disclosures about Market Risk

Quantitative and Qualitative Disclosures about Market Risk 17 Item 4.

Controls and Procedures

Controls and Procedures 17

OTHER INFORMATION

PART II. OTHER INFORMATION 19 Item 1.

Legal Proceedings

Legal Proceedings 19 Item 1A.

Risk Factors

Risk Factors 19 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 19 Item 3. Defaults Upon Senior Securities 19 Item 4. Mine Safety Disclosures 19 Item 5. Other Information 19 Item 6. Exhibits 20

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION

FINANCIAL STATEMENTS

ITEM 1. FINANCIAL STATEMENTS TREES CORPORATION CONDENSED CONSOLIDATED BALANCE SHEETS March 31, 2024 (unaudited) December 31, 2023 Assets Current assets Cash and cash equivalents $ 414,225 $ 969,676 Accounts receivable, net of allowance of $ 41,000 and $ 42,000 , respectively 81,455 111,863 Inventories, net 801,022 860,918 Prepaid expenses and other current assets 394,086 411,911 Total current assets 1,690,788 2,354,368 Right-of-use operating lease asset 1,866,226 1,979,833 Property and equipment, net 1,355,424 1,395,104 Intangible assets, net 1,507,465 1,637,491 Goodwill 15,880,097 15,880,097 Total assets $ 22,300,000 $ 23,246,893 Liabilities and Stockholders' Equity (Deficit) Current liabilities Accounts payable and accrued expenses $ 2,814,450 $ 2,617,536 Interest payable 1,823,447 1,570,077 Income tax payable 529,748 392,765 Operating lease liability, current 849,686 846,201 Finance lease liability, current 79,259 205,400 Accrued stock payable 60,900 60,900 Accrued dividends 123,900 106,200 Warrant derivative liability 3,223 4,716 Accrued legal fees 90,000 102,000 Notes payable - current 990,067 1,092,382 Contingent Earnout Liability 469,907 367,056 Total current liabilities 7,834,587 7,365,233 Operating lease liability, non-current 1,106,199 1,218,392 Finance lease liability, non-current 610,238 501,248 Notes payable - non-current (net of unamortized discount) 13,993,311 14,013,861 Total liabilities 23,554,335 23,098,734 Commitments and contingencies (Note 12) Stockholders' equity (deficit) Preferred stock, no par value; 5,000,000 and 5,000,000 shares authorized; 1,180 and 1,180 issued and outstanding, respectively 1,073,446 1,073,446 Common stock, $ 0.001 par value; 200,000,000 and 200,000,000 shares authorized; 108,746,520 and 108,746,520 shares issued and outstanding, respectively 108,746 108,746 Additional paid-in capital 9

financial statements

financial statements. 1 TREES CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) Three months ended March 31, 2024 2023 Revenue Retail sales $ 3,685,881 $ 5,110,619 Total revenue 3,685,881 5,110,619 Costs and expenses Cost of sales 2,189,095 3,057,714 Selling, general and administrative 1,445,249 2,296,240 Stock-based compensation 14,968 27,396 Professional fees 323,573 607,544 Depreciation and amortization 190,344 292,842 Total costs and expenses 4,163,229 6,281,736 Operating loss ( 477,348 ) ( 1,171,117 ) Other income (expenses) Amortization of debt discount ( 120,330 ) ( 181,677 ) Interest expense ( 553,743 ) ( 449,311 ) Gain on derivative liability 1,493 1,307 Loss on contingent earnout ( 102,851 ) — Total other income (expenses) ( 775,431 ) ( 629,681 ) Net loss before income taxes ( 1,252,779 ) ( 1,800,798 ) Provision for income taxes 136,983 85,736 Net loss $ ( 1,389,762 ) ( 1,886,534 ) Accrued preferred stock dividend ( 17,700 ) ( 17,700 ) Net loss attributable to common stockholders $ ( 1,407,462 ) ( 1,904,234 ) Per share data - basic and diluted Net loss attributable to common stockholders per share $ ( 0.01 ) $ ( 0.02 ) Weighted average number of common shares outstanding 108,746,520 118,664,094 See Notes to unaudited condensed consolidated

financial statements

financial statements. 2 TREES CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) Three months ended March 31, 2024 2023 Cash flows from operating activities Net loss $ ( 1,389,762 ) $ ( 1,886,534 ) Adjustments to reconcile net loss to net cash (used in) provided by operating activities: Amortization of debt discount 120,330 181,677 Depreciation and amortization 190,344 292,842 Non-cash lease expense 113,607 19,421 Loss (gain) on contingent earnout 102,851 — Loss (gain) on derivative liability ( 1,493 ) ( 1,307 ) Stock-based compensation 14,968 27,396 Changes in operating assets and liabilities, net of acquisitions Accounts receivable 30,408 ( 21,468 ) Prepaid expenses and other assets 17,825 ( 3,035 ) Inventories 59,896 ( 346,453 ) Income taxes 136,893 85,742 Accounts payable, accrued liabilities, and interest payable 438,284 1,148,754 Operating lease liabilities ( 108,708 ) — Net cash used in operating activities ( 274,467 ) ( 502,965 ) Cash flows from investing activities Purchase of property and equipment ( 20,638 ) ( 24,310 ) Acquisition of Station 2 assets — ( 256,582 ) Net cash used in investing activities ( 20,638 ) ( 280,892 ) Cash flows from financing activities Payments on notes payable and finance lease ( 260,346 ) ( 339,814 ) Net cash (used in) financing activities ( 260,346 ) ( 339,814 ) Net (decrease) in cash and cash equivalents ( 555,451 ) ( 1,123,671 ) Cash and cash equivalents, beginning of period 969,676 2,583,833 Cash and cash equivalents, end of period $ 414,225 $ 1,460,162 Supplemental schedule of cash flow information Cash paid for interest $ — $ 28,425 Cash paid for taxes $ — $ 6 Non-cash investing & financing activities Non-cash debt issuance for acquisition of Station 2 assets $ — $ 333,953 Issuance of accrued stock 17,700 17,700 See Notes to unaudited condensed consolidated

financial statements

financial statements. 3 TREES CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY For the three months ended March 31, 2024 Preferred Stock Common Stock Additional Paid- Accumulated Shares Amount Shares Amount in Capital Deficit Total January 1, 2024 1,180 $ 1,073,446 108,746,520 $ 108,746 $ 99,450,307 $ ( 100,484,340 ) $ 148,159 Share-based compensation — — — — 14,968 — 14,968 Dividend on Preferred Stock — — — — — ( 17,700 ) ( 17,700 ) Net loss — — — — — ( 1,389,762 ) ( 1,389,762 ) March 31, 2024 1,180 $ 1,073,446 108,746,520 $ 108,746 $ 99,465,275 $ ( 101,891,802 ) $ ( 1,244,335 ) For the three months ended March 31, 2023 Preferred Stock Common Stock Additional Paid- Accumulated Shares Amount Shares Amount in Capital Deficit Total January 1, 2023 1,180 $ 1,073,446 118,664,094 $ 118,664 $ 98,598,761 $ ( 93,384,382 ) $ 6,406,489 Share-based compensation — — — — 27,396 — 27,396 Dividend on Preferred Stock — — — — — ( 17,700 ) ( 17,700 ) Net loss — — — — — ( 1,886,534 ) ( 1,886,534 ) March 31, 2023 1,180 $ 1,073,446 118,664,094 $ 118,664 $ 98,626,157 $ ( 95,288,616 ) $ ( 4,529,651 ) See Notes to unaudited condensed consolidated

financial statements

financial statements. 4 TREES CORPORATION NOTES TO CONDENSED CONSOLIDATED FINANCIAL (Unaudited) NOTE 1. NATURE OF OPERATIONS, HISTORY, AND PRESENTATION Nature of Operations TREES Corporation, a Colorado Corporation (the "Company," "we," "us," or "our,") is a cannabis retailer and cultivator in the States of Colorado and Oregon. We presently operate six (6) cannabis dispensaries as follows: Englewood, Colorado o 5005 S Federal Boulevard – Recreational license only Denver, Colorado o East Hampden Avenue (formerly Green Man) – Recreational license only Longmont, Colorado o 12626 N. 107 th Street (formerly Green Tree/Ancient Alternatives) – Medical and Recreational licenses Three (3) in Oregon o SW Corbett Avenue, Portland, OR – Medical and Recreational licenses o NE 102 nd Avenue, Portland, OR – Medical and Recreational licenses o 7050 NE MLK, Portland, OR – Medical and Recreational licenses We also operate two (2) cultivation facilities in Colorado as follows: SevenFive Farm – 3705 N. 75 th Street, Boulder – Retail cultivation license only 6859 N. Foothills Highway E-100 (formerly Green Tree/Hillside Enterprises) – Retail cultivation license only Our principal business model is to acquire, integrate and optimize cannabis companies in the retail and cultivation segments utilizing the combined experience of entrepreneurs and synergistic operations of our vertically integrated network. Basis of Presentation The accompanying unaudited condensed consolidated financial statements include all accounts of the Company and its wholly owned subsidiaries. All inter-company accounts and transactions have been eliminated in consolidation. These unaudited condensed consolidated financial statements have been prepared following the requirements of the Securities and Exchange Commission for interim reporting. As permitted under those rules, certain footnotes and other financial information that are normally required by accounting pr

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