YourWay Cannabis Brands Faces Challenges with Financial Reporting and Management Changes

LOS ANGELES- YourWay Cannabis Brands Inc., a company traded on the Canadian Securities Exchange  and the OTC market (OTC: YOURF), is grappling with significant challenges, including delays in financial reporting and management upheavals. The company has disclosed to its investors that it is still behind in reporting its 2022 financial results and has not yet commenced preparations for the 2023 financial statements.

The company is in the midst of conducting audits for its 2022 results, a process that is consuming considerable resources, with the completion timeline still uncertain. Additionally, YourWay has yet to file its tax returns for 2022. These delays come at a time when the company is striving to achieve financial stability, conduct essential financial audits, and relist its shares on the CSE, all while managing a cease trade order.

Recent Management Changes The past week saw significant changes in YourWay’s leadership. CEO and Chairman Jakob Ripshtein resigned, leading to the appointment of Brett Mecum, an existing board member, as the new chairman. Mason Cave, previously the CEO of Venom before its acquisition by YourWay, has been appointed as interim CEO and board member. Cave expressed his commitment to resolving the company’s issues, streamlining operations, and reducing expenses, with an eye toward delivering value to shareholders from the Venom asset.

In a notable development, CFO Sandra Ceccacci was terminated for cause, while directors Kevin Harrington, Eula Adams, and Lily Dash resigned. The search for a new CFO is currently underway.

Labtronix Challenges and Potential Sale Adding to its complexities, YourWay and its wholly owned subsidiary Labtronix are embroiled in a lawsuit filed by Trulieve Cannabis Corp., a legal battle that is draining the company’s resources. Labtronix has also seen a decline in sales recently, which coincides with the ongoing lawsuit.

However, there may be a silver lining with the potential sale of Labtronix. YourWay has received a letter of intent from an independent entity in Arizona to purchase Labtronix for $3 million. This deal would transfer the Trulieve lawsuit and another employee lawsuit to the buyer, along with all existing debts and tax liabilities of Labtronix. The sale of Labtronix, if finalized, could simplify the auditing process for YourWay and provide some much-needed financial relief.

As YourWay navigates these tumultuous times, with delayed financial reporting, management restructuring, and legal battles, the potential sale of Labtronix emerges as a crucial element in the company’s strategy to stabilize and move forward.