One company that has been overlooked by the market in recent action – or so it appears to us – is Cannabis Global, Inc. (OTCMKTS:CBGL), a leading cannabinoid products company that recently underwent a name and ticker change (previously MCTC Holdings – MCTC).
CBGL has piled up catalysts recently, and its worth a closer look at present levels, particularly after the company just announced the repayment and retirement of multiple convertible notes along with “other positive restructuring of the Company’s debt obligations.”
In short, this is a dilution-risk positive adjustment of the cap structure overall, including the repayment of three convertible notes with a total principal value of $178,500. The move also included a binding agreement with an institutional investor to finance the payoff of an additional $63,000 note.
According to the company’s release, these actions, which prevented the conversion of debt to equity, are in addition to corporate actions taken during May 2020, which canceled convertible notes valued at $133,101 from the balance sheet as well as the transition of short term notes valued at $500,000 into a long term, 5-year, zero-interest note paid in monthly installments. The Company expects these debt payments and restructurings to have a significant positive impact on the Company’s balance sheet for the fiscal year ending August 31, 2020, minimize shareholder dilution risk.
In other words, in addition to the name and ticker change, the company has been hard at work to make its structure more and more investor friendly. All of this denotes a company willing to make whatever changes necessary to cultivate a positive and productive relationship with capital markets. Good investments generally start with that disposition.
“The funds we raised from convertible notes earlier this year were used wisely to jump-start the development of what we believe to be the most robust set of cannabinoid infusion technologies in the marketplace,” commented Cannabis Global CEO, Arman Tabatabaei. “As a result, we were able to file six provisional patents, develop several new technologies, which we are classifying as trade secrets, and develop multiple new products based on our IP accomplishments. With the largest component of these notes paid in full and a definitive agreement in place to fully pay another note that is coming due, we are well-positioned not only to continue our R&D programs but also to roll out the highly innovative products developed based on our internally developed IP. We have now paid off – without conversion – three of these notes and have an agreement in place to pay off the fourth by August 18.”
This is also a company that has some very big goals being executed so far with success. This is an R&D-heavy play in the cannabinoid space.
Cannabis Global, Inc. (OTCMKTS:CBGL) has several recent developments that might offer some idea of the scale of the vision in play here.
Alcohol Substitutes You Can Feel
First, we would point out the company’s recent announcement of a CBD-based product that can mixed with popular drink mixers to create cocktails with no alcohol that still give you a light buzz. If this catches on, you can imagine the scale of the resulting impact for shareholders.
“Because of the ultra-low levels of hemp extracts utilized, we feel we set a new standard for product-safety and satisfaction in the hemp food and beverage category with this product,” commented Arman Tabatabaei, CEO of Cannabis Global. “While our Hemp You Can Feel™ beverages likely have the lowest hemp extract levels in the industry, we believe we provide a vastly superior positive effect upon use. We invite all consumers and alcohol industry participants to try what we see as the first viable alternative to alcoholic beverages. Our website is www.HempYouCanFeel.com. Take the HempYouCanFeel Challenge!”
A Cannabinoid Diet Drug?
Another big recent move from Cannabis Global, Inc. (OTCMKTS:CBGL) is its weight loss strategy around Tetrahydrocannabivarin (THC-V) an exotic cannabinoid that the company has developed technology to produce at commercial scale – leaving it potentially alone in that regard.
The company is now running a “mouse study” to see if it works. The test was prompted by anecdotal evidence from multiple sources suggesting THCV may have an appetite suppressant quality. If the study reveals a tangible impact, we would assume the company will proceed to further and more significant (and far more publicly visible) testing before the CEO is on Oprah or Dr. Oz with the good news and the stock is at $100.
Another big move from CBGL in recent weeks – this is all just in recent weeks – is a definitive agreement to enter the fast-growing California cannabis delivery market.
According to the release, Whisper Weed, Inc. and Cannabis Global, have created a new California Corporation to be named CGI Whisper W, Inc., which will provide management services for the delivery entity. CGI Whisper W, Inc, will receive 51% of the profits from the new entity, which will be recognized as income by Cannabis Global, Inc.
“The delivery sector is the hottest area of the California cannabis business and we are very pleased to have a seat at the table,” commented Tabatabaei. “We not only will be able to grow our revenue base relative to direct delivery, but we also see Whisper Weed as a perfect platform to launch our infusion technologies in the regulated marketplace. With the deal closing, we are already in the process of adding other delivery platforms and other businesses to our overall portfolio.”
Cannabis Global Inc (OTCMKTS:CBGL) is extremely cheap, likely because most people haven’t ever heard of it, suggesting some upside potential as word spreads on these key catalysts.