10-Q 1 tcnnf-20220930.htm 10-Q 10-Q
two yeartwo yearone yearP2YP3Ytwo yearQ3--12-31falseP2Y0001754195 January 1, 2021UnlimitedUnlimitedone yearDecember 2029two yearP5Y0001754195us-gaap:RestrictedStockUnitsRSUMembertcnnf:HarvestHealthAndRecreationIncMember2021-10-012021-10-0100017541952021-01-012021-03-310001754195tcnnf:DirectorsAndOfficersMemberus-gaap:RestrictedStockUnitsRSUMember2022-01-012022-03-310001754195us-gaap:CommonStockMember2020-12-310001754195tcnnf:PromissoryNoteAcquiredFromHarvestMaturingInNovemberTwoThousandTwentyFiveSecuredByCertainAssetsMember2021-10-012021-10-310001754195tcnnf:HarvestHealthAndRecreationIncMember2021-10-012021-10-010001754195tcnnf:MultipleVotingSharesMember2020-12-3100017541952021-04-012021-06-300001754195us-gaap:RetainedEarningsMember2022-01-012022-03-3100017541952021-03-310001754195us-gaap:FairValueInputsLevel2Memberus-gaap:MeasurementInputMaturityMember2022-09-300001754195srt:MinimumMember2021-01-012021-09-300001754195srt:MinimumMember2022-01-012022-09-300001754195tcnnf:OmnibusIncentivePlanMembertcnnf:OfficersAndOtherSelectEmployeesMembersrt:MaximumMemberus-gaap:RestrictedStockUnitsRSUMember2021-09-292021-09-290001754195tcnnf:HarvestHealthAndRecreationIncMembertcnnf:DispensaryLicenseMember2021-10-010001754195tcnnf:ImpairmentAndDisposalOfLongedLivedAssetsNetMember2022-01-012022-09-300001754195tcnnf:UnmedicatedMember2022-09-300001754195tcnnf:FavorableLeaseholdInterestsMembertcnnf:KeystoneShopsMember2021-07-080001754195us-gaap:TrademarksMembertcnnf:HarvestHealthAndRecreationIncMember2021-10-0100017541952022-01-012022-03-310001754195us-gaap:AdditionalPaidInCapitalMembertcnnf:KeystoneReliefCentersLLCMember2021-04-012021-06-300001754195tcnnf:NaturesRemedyOfMassachusettsIncMember2022-01-012022-09-300001754195us-gaap:CustomerRelationshipsMember2021-12-310001754195tcnnf:AlachuaMember2021-10-012021-10-310001754195tcnnf:VariousRelatedPartiesMember2021-12-310001754195us-gaap:RetailMember2021-07-012021-09-300001754195tcnnf:EightPercentageSeniorSecuredNotesTrancheTwoMember2022-01-280001754195tcnnf:AnnaHoldingsLLCMembertcnnf:DispensaryLicenseMember2021-07-082021-07-080001754195tcnnf:AlachuaMember2021-10-310001754195us-gaap:CommonStockMember2022-04-012022-06-300001754195us-gaap:RetailMember2022-07-012022-09-300001754195us-gaap:DiscontinuedOperationsDisposedOfBySaleMembertcnnf:NevadaOperationsMember2022-07-012022-09-300001754195tcnnf:AssetsRepositioningMember2022-07-012022-09-300001754195tcnnf:CostOfGoodsSoldSalesAndMarketingGeneralAndAdministrativeMember2021-07-012021-09-300001754195tcnnf:EquityWarrantsMember2021-12-310001754195us-gaap:CommonStockMember2021-03-310001754195tcnnf:MultipleVotingSharesMember2022-01-012022-03-310001754195us-gaap:FairValueInputsLevel2Memberus-gaap:MeasurementInputExercisePriceMember2021-12-310001754195tcnnf:Cp4GroupLimitedLiabilityCompanyMember2022-02-142022-02-140001754195us-gaap:AdditionalPaidInCapitalMember2022-09-300001754195us-gaap:CostOfSalesMember2022-01-012022-09-300001754195tcnnf:MultipleVotingSharesMember2022-01-012022-09-300001754195tcnnf:JuneNotesMember2019-01-012019-12-310001754195us-gaap:BuildingAndBuildingImprovementsMember2021-12-310001754195us-gaap:RestrictedStockUnitsRSUMember2022-09-300001754195us-gaap:CommonStockMember2022-01-012022-03-310001754195tcnnf:SubordinateVotingSharesMembertcnnf:MountaineerHoldingLLCMember2021-04-012021-06-300001754195tcnnf:HarvestHealthAndRecreationIncMember2022-01-012022-09-300001754195us-gaap:OtherIncomeMember2022-07-012022-09-300001754195us-gaap:NotesReceivableMember2022-01-012022-09-3000017541952021-09-300001754195tcnnf:SolevoWellnessWestVirginiaLLCMember2021-06-080001754195tcnnf:MultipleVotingSharesMember2022-09-300001754195tcnnf:PromissoryNoteAcquiredInHarvestAcquisitionMaturingInFebruaryTwoThousandTwentyThreeMonthlyInterestPaymentsDueAtFivePointFivePercentMember2021-12-310001754195tcnnf:SubordinateVotingSharesMembertcnnf:NaturesRemedyOfMassachusettsIncMember2021-04-012021-06-300001754195tcnnf:HancockMember2022-01-012022-09-300001754195us-gaap:EmployeeStockOptionMembertcnnf:HarvestHealthAndRecreationIncMember2021-10-012021-10-0100017541952021-07-012021-09-300001754195us-gaap:FairValueInputsLevel2Membertcnnf:MeasurementInputExchangeRateMember2021-12-310001754195us-gaap:RetainedEarningsMember2021-12-310001754195us-gaap:SellingAndMarketingExpenseMembertcnnf:Cp4GroupLimitedLiabilityCompanyMember2022-01-012022-09-300001754195tcnnf:HancockMember2022-09-300001754195tcnnf:SubordinateVotingSharesMember2021-04-012021-06-300001754195tcnnf:CostOfGoodsSoldSalesAndMarketingGeneralAndAdministrativeMember2022-01-012022-09-300001754195tcnnf:PromissoryNoteAcquiredInHarvestMaturingInAprilTwoThousandTwentySixSecuredByEquipmentPrincipalDueAtMaturityMember2021-12-310001754195tcnnf:PromissoryNotesMatureInDecemberTwoThousandTwentyTwoMonthlyVariableInterestPaymentsDueOfSevenPointZeroPercentSecuredByPropertyMember2021-12-310001754195tcnnf:PromissoryNoteAcquiredInHarvestAcquisitionMaturingInAugustTwoThousandTwentyFourMonthlyInterestPaymentsDueOfTwoPercentSecuredByCertainAssetsMember2022-09-300001754195tcnnf:HancockMember2021-01-012021-12-310001754195tcnnf:PatientCentricOfMarthasVineyardLimitedMember2021-07-020001754195us-gaap:CommonStockMember2021-04-012021-06-300001754195us-gaap:FairValueInputsLevel2Memberus-gaap:MeasurementInputExercisePriceMember2022-09-300001754195us-gaap:CustomerRelationshipsMembertcnnf:HarvestHealthAndRecreationIncMember2021-10-012021-10-010001754195tcnnf:MultipleVotingSharesMember2022-07-012022-09-300001754195us-gaap:RestrictedStockUnitsRSUMemberus-gaap:SellingAndMarketingExpenseMember2022-01-012022-09-300001754195us-gaap:FurnitureAndFixturesMember2022-09-300001754195us-gaap:CommonStockMember2021-07-012021-09-300001754195tcnnf:PatientCentricOfMarthaSVineyardMember2021-07-012021-09-300001754195tcnnf:PromissoryNotesAcquiredFromHarvestMaturingInFebruaryTwoThousandTwentyTwoSecuredByCertainAssetsMember2021-10-012021-10-310001754195srt:MinimumMembertcnnf:OtherLeasedAssetsMember2022-09-300001754195tcnnf:SolevoWellnessWestVirginiaLLCMember2021-06-082021-06-080001754195tcnnf:HancockMember2021-10-310001754195stpr:MA2021-01-012021-12-310001754195tcnnf:OmnibusIncentivePlanMembertcnnf:OfficersAndOtherSelectEmployeesMembersrt:MinimumMemberus-gaap:RestrictedStockUnitsRSUMember2021-09-292021-09-290001754195tcnnf:PromissoryNotesOfConsolidatedVariableInterestEntitiesAcquiredInHarvestAcquisitionMaturingDecemberTwoThousandTwentyTwoAndTwoThousandTwentyNineMembersrt:MaximumMember2022-09-3000017541952022-09-300001754195tcnnf:WholesaleLicensingAndOtherMember2021-01-012021-09-300001754195srt:MaximumMember2021-01-012021-09-300001754195tcnnf:NaturesRemedyOfMassachusettsIncMember2021-04-012021-06-300001754195tcnnf:ConvertibleNoteReceivableDatedNovemberTwoThousandTwentyOneMaturingInNovemberTwoThousandTwentyFourMember2021-11-012021-11-300001754195tcnnf:PromissoryNotesOfConsolidatedVariableInterestEntitiesAcquiredInHarvestAcquisitionMaturingDecemberTwoThousandTwentyTwoAndTwoThousandTwentyNineMember2021-12-310001754195tcnnf:ImpairmentAndDisposalsOfNonoperatingAssetsNetMember2022-01-012022-09-300001754195tcnnf:SubordinateVotingSharesMember2020-12-310001754195tcnnf:KeystoneShopsMember2021-07-082021-07-080001754195us-gaap:FairValueInputsLevel2Memberus-gaap:MeasurementInputMaturityMember2021-12-310001754195tcnnf:ImpairmentAndDisposalOfNonOperatingAssetsMember2022-01-012022-09-300001754195us-gaap:RestrictedStockUnitsRSUMember2022-01-012022-09-300001754195tcnnf:AlachuaMember2022-09-300001754195tcnnf:OmnibusIncentivePlanMembertcnnf:DirectorsAndOfficersMembersrt:MaximumMember2022-02-242022-02-240001754195tcnnf:BusinessCombinationContingentConsiderationLiabilityCurrentMember2022-09-300001754195us-gaap:RestrictedStockUnitsRSUMemberus-gaap:CostOfSalesMember2022-07-012022-09-300001754195tcnnf:Cp4GroupLimitedLiabilityCompanyMember2022-02-1400017541952022-07-012022-09-300001754195tcnnf:EightPercentageSeniorSecuredNotesTrancheTwoMember2022-01-012022-09-300001754195tcnnf:MultipleVotingSharesMember2022-06-300001754195tcnnf:DispensaryLicenseMembertcnnf:SolevoWellnessWestVirginiaLLCMember2021-06-080001754195srt:MaximumMember2022-01-012022-09-300001754195us-gaap:CommonStockMember2021-06-300001754195tcnnf:DirectorsAndOfficersMembersrt:MinimumMembertcnnf:StockOptionPlanMember2021-01-042021-01-040001754195tcnnf:PromissoryNoteMaturingInOctoberTwoThousandTwentyFourMonthlyInterestPaymentsDueOfFivePointFivePercentPrincipalBalanceDueAtMaturityMember2022-01-012022-09-300001754195tcnnf:WholesaleLicensingAndOtherMember2022-01-012022-09-300001754195tcnnf:MedicatedMember2022-09-300001754195tcnnf:ScenarioThreeMembersrt:MinimumMemberstpr:PA2019-10-012019-10-310001754195tcnnf:DirectorsAndOfficersMemberus-gaap:RestrictedStockUnitsRSUMember2022-02-242022-02-240001754195stpr:FL2022-09-300001754195tcnnf:MultipleVotingSharesMember2022-03-310001754195tcnnf:PromissoryNoteAcquiredInHarvestAcquisitionMaturingInAugustTwoThousandTwentyFourMonthlyInterestPaymentsDueOfTwoPercentSecuredByCertainAssetsMember2022-01-012022-09-300001754195tcnnf:SolevoWellnessWestVirginiaLLCMembertcnnf:SubordinateVotingSharesMember2021-04-012021-06-3000017541952022-06-300001754195tcnnf:EightPercentageSeniorSecuredNotesTrancheTwoMember2022-01-282022-01-280001754195us-gaap:VariableInterestEntityPrimaryBeneficiaryMember2022-09-300001754195tcnnf:NovemberNotesMember2021-07-012021-09-300001754195tcnnf:SubordinateVotingSharesMembertcnnf:KeystoneShopsMember2021-07-012021-09-300001754195tcnnf:PublicWarrantsMember2022-09-300001754195tcnnf:CannabisPlantsMember2022-09-300001754195tcnnf:SubordinateVotingSharesMember2022-01-012022-09-300001754195tcnnf:EightPercentageSeniorSecuredNotesTrancheOneMember2021-10-062021-10-060001754195tcnnf:PromissoryNoteAcquiredInHarvestAcquisitionMaturingInJanuaryTwoThousandTwentyThreeMonthlyInterestPaymentsDueOfTwoPercentMember2022-09-300001754195us-gaap:CostOfSalesMember2021-07-012021-09-300001754195us-gaap:RetainedEarningsMember2022-06-300001754195tcnnf:AnnaHoldingsLLCMember2022-09-300001754195tcnnf:InternalUseSoftwareMember2022-09-300001754195us-gaap:SellingAndMarketingExpenseMember2021-07-012021-09-300001754195tcnnf:PromissoryNotesAcquiredFromHarvestMaturingInFebruaryTwoThousandTwentyTwoSecuredByCertainAssetsMember2021-10-310001754195tcnnf:SuperVotingSharesMember2021-01-012021-03-310001754195us-gaap:FairValueInputsLevel2Memberus-gaap:MeasurementInputSharePriceMember2021-12-310001754195srt:MaximumMemberus-gaap:GeneralAndAdministrativeExpenseMembertcnnf:EightPercentageSeniorSecuredNotesTrancheOneMember2022-01-012022-09-300001754195tcnnf:EquityWarrantsMember2022-09-300001754195tcnnf:SolevoWellnessWestVirginiaLLCMember2021-04-012021-06-300001754195tcnnf:CostOfGoodsSoldSalesAndMarketingGeneralAndAdministrativeMember2022-07-012022-09-300001754195us-gaap:RetainedEarningsMember2022-04-012022-06-300001754195tcnnf:MultipleVotingSharesMember2021-01-012021-12-310001754195tcnnf:PurepennLlcAndPioneerLeasingAndSolevoEarnoutMemberus-gaap:CommonStockMember2022-01-012022-03-310001754195tcnnf:HarvestHealthAndRecreationIncMembertcnnf:FloridaCannabisLicenseMember2021-10-012021-10-010001754195tcnnf:OmnibusIncentivePlanMembertcnnf:DirectorsAndOfficersMembersrt:MinimumMember2022-01-042022-01-040001754195tcnnf:VariousRelatedPartiesMember2022-09-300001754195tcnnf:SubordinateVotingSharesMember2022-07-012022-09-300001754195tcnnf:KeystoneShopsMember2022-01-012022-09-300001754195tcnnf:UnmedicatedMember2021-12-310001754195us-gaap-supplement:SoutheastRegionMember2022-07-012022-09-300001754195tcnnf:ImpairmentAndDisposalOfLongLivedAssetsMemberus-gaap-supplement:SoutheastRegionMember2022-01-012022-09-300001754195us-gaap:TrademarksMember2021-12-310001754195srt:MaximumMemberus-gaap:GeneralAndAdministrativeExpenseMembertcnnf:EightPercentageSeniorSecuredNotesTrancheOneMember2022-07-012022-09-300001754195us-gaap:CommonStockMember2021-01-012021-03-310001754195us-gaap:NoncontrollingInterestMember2022-01-012022-03-310001754195tcnnf:PurplemedHealingCenterMember2021-12-282021-12-280001754195us-gaap:InterestExpenseMember2022-07-012022-09-300001754195us-gaap:VehiclesMember2022-09-300001754195stpr:FL2019-10-310001754195us-gaap:DiscontinuedOperationsDisposedOfBySaleMembertcnnf:NevadaOperationsMember2022-01-012022-09-300001754195tcnnf:SubordinateVotingSharesMember2021-06-300001754195us-gaap:RetainedEarningsMember2021-09-300001754195tcnnf:ConvertibleNoteReceivableDatedNovemberTwoThousandTwentyOneMaturingInNovemberTwoThousandTwentyFourMember2021-11-300001754195us-gaap:AdditionalPaidInCapitalMembertcnnf:NaturesRemedyOfMassachusettsIncMember2021-04-012021-06-300001754195tcnnf:MultipleVotingSharesMember2021-03-310001754195tcnnf:DispensaryLicenseMembertcnnf:HarvestHealthAndRecreationIncMember2021-10-012021-10-010001754195tcnnf:LiabilityWarrantsMember2022-01-012022-09-300001754195tcnnf:DispensaryLicenseMembertcnnf:SolevoWellnessWestVirginiaLLCMember2021-06-082021-06-080001754195tcnnf:SubordinateVotingSharesMember2021-10-012021-10-310001754195tcnnf:PublicWarrantsMember2021-12-310001754195us-gaap:RetainedEarningsMember2021-06-300001754195tcnnf:PackagingAndSuppliesMember2021-12-310001754195us-gaap:RetainedEarningsMember2021-04-012021-06-300001754195srt:MaximumMember2022-09-300001754195tcnnf:SubordinateVotingSharesMember2022-03-310001754195srt:MaximumMember2021-09-300001754195tcnnf:HarvestHealthAndRecreationIncMember2022-09-300001754195tcnnf:PromissoryNoteMaturingInJulyTwoThousandTwentyThreeMonthlyInterestPaymentsDueAtFourPercentPerAnnumSecuredByCertainAssetsMember2022-09-300001754195tcnnf:PromissoryNoteAcquiredInHarvestAcquisitionMaturingInMayTwoThousandTwentyThreeQuarterlyInterestPaymentsDueOfTwoPercentMember2022-01-012022-09-300001754195us-gaap:CostOfSalesMember2021-01-012021-09-300001754195us-gaap:RestrictedStockUnitsRSUMembersrt:MinimumMember2022-01-012022-09-300001754195tcnnf:CertainEmployeesAndDirectorsMemberus-gaap:WarrantMember2020-01-012020-12-310001754195tcnnf:SubordinateVotingSharesMember2022-06-300001754195tcnnf:SubordinateVotingSharesMember2022-04-012022-06-300001754195tcnnf:PromissoryNoteAcquiredInHarvestAcquisitionMaturingInFebruaryTwoThousandTwentyThreeMonthlyInterestPaymentsDueAtFivePointFivePercentMember2022-09-300001754195tcnnf:NaturesRemedyOfMassachusettsIncMember2021-06-300001754195tcnnf:PurplemedHealingCenterMember2021-12-282021-12-280001754195tcnnf:PromissoryNoteOfConsolidatedVariableInterestEntityMaturingFebruaryTwoThousandTwentyNineMonthlyInterestPaymentsDueAtEightPercentMember2022-09-300001754195us-gaap:CommonStockMembertcnnf:PatientCentricOfMarthaSVineyardMember2021-07-012021-09-300001754195tcnnf:DirectorsAndOfficersMemberus-gaap:RestrictedStockUnitsRSUMember2022-01-042022-01-040001754195us-gaap:CommonStockMembertcnnf:KeystoneShopsMember2021-07-012021-09-300001754195us-gaap:GeneralAndAdministrativeExpenseMember2021-01-012021-09-300001754195tcnnf:SubordinateVotingSharesMember2021-09-300001754195us-gaap:AdditionalPaidInCapitalMembertcnnf:MountaineerHoldingLLCMember2021-04-012021-06-300001754195us-gaap:WarrantMemberus-gaap:RestrictedStockUnitsRSUMember2021-09-152021-09-150001754195us-gaap:RestrictedStockUnitsRSUMemberus-gaap:CostOfSalesMember2022-01-012022-09-300001754195tcnnf:InternalUseSoftwareMember2021-12-310001754195us-gaap:NoncontrollingInterestMember2022-04-012022-06-300001754195tcnnf:ImpairmentAndDisposalsOfNonoperatingAssetsNetMember2022-07-012022-09-300001754195tcnnf:MultipleVotingSharesMember2022-04-012022-06-300001754195tcnnf:CertainEmployeesAndDirectorsMemberus-gaap:WarrantMember2021-01-012021-09-300001754195tcnnf:PromissoryNoteAcquiredInHarvestAcquisitionMaturingInJanuaryTwoThousandTwentyThreeMonthlyInterestPaymentsDueOfTwoPercentMember2022-01-012022-09-300001754195tcnnf:JuneNotesMember2022-01-012022-09-300001754195us-gaap:InterestExpenseMember2021-07-012021-09-300001754195us-gaap:AdditionalPaidInCapitalMembertcnnf:KeystoneShopsMember2021-07-012021-09-300001754195tcnnf:SubordinateVotingSharesMember2021-01-012021-03-310001754195us-gaap:RetailMember2021-01-012021-09-300001754195tcnnf:HarvestHealthAndRecreationIncMembertcnnf:SubordinateVotingSharesMember2021-10-012021-10-010001754195tcnnf:PromissoryNoteMaturingInOctoberTwoThousandTwentyFourMonthlyInterestPaymentsDueOfFivePointFivePercentPrincipalBalanceDueAtMaturityMember2022-09-300001754195tcnnf:JuneNotesMember2022-07-012022-09-300001754195us-gaap:AdditionalPaidInCapitalMembertcnnf:PurePennLLCAndPioneerLeasingAndConsultingLLCMember2021-04-012021-06-300001754195tcnnf:DispensaryLicenseMembertcnnf:NaturesRemedyOfMassachusettsIncMember2021-06-302021-06-300001754195us-gaap:RetailMember2022-01-012022-09-300001754195srt:MaximumMembertcnnf:NaturesRemedyOfMassachusettsIncMember2021-06-302021-06-300001754195tcnnf:PromissoryNoteAcquiredInHarvestAcquisitionMaturingInJanuaryTwoThousandTwentyThreeMonthlyInterestPaymentsDueOfTwoPercentMember2021-12-310001754195us-gaap:RetainedEarningsMember2021-03-310001754195tcnnf:PromissoryNoteAcquiredInHarvestAcquisitionMaturingInMayTwoThousandTwentyThreeQuarterlyInterestPaymentsDueOfTwoPercentMember2021-12-310001754195us-gaap:OtherNonoperatingIncomeExpenseMember2022-07-012022-09-300001754195srt:MaximumMembertcnnf:EquityWarrantsMember2021-10-310001754195tcnnf:MedicatedMember2021-12-310001754195tcnnf:PatientCentricOfMarthaSVineyardMember2022-01-012022-09-300001754195tcnnf:AlachuaMember2021-01-012021-12-310001754195tcnnf:BusinessCombinationContingentConsiderationLiabilityCurrentMemberus-gaap:PendingLitigationMember2022-09-300001754195us-gaap:RestrictedStockUnitsRSUMember2021-07-012021-09-300001754195tcnnf:SolevoWellnessWestVirginiaLLCMemberus-gaap:CommonStockMember2021-04-012021-06-300001754195us-gaap:VariableInterestEntityPrimaryBeneficiaryMember2021-12-310001754195us-gaap:CommonStockMembertcnnf:NaturesRemedyOfMassachusettsIncMember2021-04-012021-06-300001754195tcnnf:EquityWarrantsMember2021-10-012021-10-310001754195tcnnf:KeystoneReliefCentersLLCMember2021-04-012021-06-300001754195us-gaap:PrepaidExpensesAndOtherCurrentAssetsMember2022-09-300001754195tcnnf:PromissoryNoteAcquiredInHarvestAcquisitionMaturingInFebruaryTwoThousandTwentyThreeMonthlyInterestPaymentsDueAtFivePointFivePercentMember2022-01-012022-09-300001754195tcnnf:MultipleVotingSharesMember2021-07-012021-09-300001754195tcnnf:NotContractuallyIssuableUntil2024Member2022-01-012022-09-300001754195us-gaap:CostOfSalesMember2022-07-012022-09-300001754195us-gaap:CommonStockMember2022-03-310001754195tcnnf:MultipleVotingSharesMember2021-01-012021-03-310001754195us-gaap:RetainedEarningsMember2022-09-300001754195us-gaap:NoncontrollingInterestMember2022-07-012022-09-300001754195us-gaap-supplement:SoutheastRegionMembertcnnf:ImpairmentAndDisposalOfNonOperatingAssetsMember2022-07-012022-09-300001754195tcnnf:NovemberNotesMember2022-07-012022-09-300001754195tcnnf:AssetsRepositioningMember2022-01-012022-09-300001754195tcnnf:EquityWarrantsMember2022-01-012022-09-300001754195tcnnf:PromissoryNoteAcquiredInHarvestMaturingInAprilTwoThousandTwentySixSecuredByEquipmentPrincipalDueAtMaturityMember2022-01-012022-09-300001754195tcnnf:PromissoryNoteAcquiredFromHarvestMaturingInNovemberTwoThousandTwentyFiveSecuredByCertainAssetsMember2021-12-310001754195tcnnf:OmnibusIncentivePlanMember2022-09-300001754195tcnnf:SubordinateVotingSharesMember2021-12-310001754195us-gaap:SellingAndMarketingExpenseMembertcnnf:Cp4GroupLimitedLiabilityCompanyMember2022-07-012022-09-300001754195stpr:PA2022-09-300001754195us-gaap:AdditionalPaidInCapitalMember2022-07-012022-09-300001754195tcnnf:OmnibusIncentivePlanMembertcnnf:OfficersAndOtherSelectEmployeesMember2021-09-292021-09-290001754195us-gaap:RetainedEarningsMember2021-07-012021-09-300001754195tcnnf:MountaineerHoldingLLCMembertcnnf:CultivationPermitAndDispensaryPermitsMember2021-05-062021-05-060001754195tcnnf:MultipleVotingSharesMember2021-10-012021-10-310001754195stpr:FL2019-10-012019-10-310001754195us-gaap:LicensingAgreementsMember2022-09-300001754195tcnnf:PurePennLLCAndPioneerLeasingAndConsultingLLCMember2021-04-012021-06-300001754195stpr:PA2021-01-012021-12-310001754195us-gaap:CommonStockMember2022-09-300001754195tcnnf:PromissoryNotesOfConsolidatedVariableInterestEntitiesAcquiredInHarvestAcquisitionMaturingDecemberTwoThousandTwentyTwoAndTwoThousandTwentyNineMembersrt:MinimumMember2022-09-300001754195us-gaap:CommonStockMembertcnnf:MountaineerHoldingLLCMember2021-04-012021-06-300001754195tcnnf:SubordinateVotingSharesMember2021-07-012021-09-300001754195tcnnf:PackagingAndSuppliesMember2022-09-300001754195us-gaap:AdditionalPaidInCapitalMember2021-12-310001754195tcnnf:PatientCentricOfMarthaSVineyardMembertcnnf:SubordinateVotingSharesMember2021-07-012021-09-300001754195us-gaap:FederalHomeLoanBankCertificatesAndObligationsFHLBMember2022-09-300001754195tcnnf:NovemberNotesMember2022-01-012022-09-300001754195us-gaap:RetainedEarningsMember2022-07-012022-09-300001754195tcnnf:SubordinateVotingSharesMember2022-09-300001754195stpr:PA2019-10-310001754195us-gaap:DiscontinuedOperationsDisposedOfBySaleMembertcnnf:NevadaOperationsMember2022-09-300001754195us-gaap:AdditionalPaidInCapitalMembertcnnf:PatientCentricOfMarthaSVineyardMember2021-07-012021-09-300001754195us-gaap:EmployeeStockOptionMember2021-01-012021-09-300001754195us-gaap:RetainedEarningsMember2021-01-012021-03-310001754195tcnnf:SuperVotingSharesMember2020-12-310001754195tcnnf:PromissoryNotesMatureInDecemberTwoThousandTwentyTwoMonthlyVariableInterestPaymentsDueOfSevenPointZeroPercentSecuredByPropertyMember2022-01-012022-09-300001754195tcnnf:ImpairmentAndDisposalOfLongLivedAssetsMemberus-gaap-supplement:SoutheastRegionMember2022-07-012022-09-300001754195us-gaap:LicensingAgreementsMember2021-12-310001754195tcnnf:HarvestHealthAndRecreationIncMember2021-10-010001754195tcnnf:Cp4GroupLimitedLiabilityCompanyMember2022-09-3000017541952022-04-012022-06-300001754195tcnnf:AlachuaMember2021-12-310001754195tcnnf:EightPercentageSeniorSecuredNotesTrancheOneMember2021-10-060001754195tcnnf:NovemberNotesMember2019-12-310001754195srt:MinimumMembertcnnf:HarvestHealthAndRecreationIncMemberus-gaap:EmployeeStockOptionMember2021-10-012021-10-010001754195stpr:PA2022-01-012022-09-300001754195srt:MaximumMemberus-gaap:RestrictedStockUnitsRSUMember2022-01-012022-09-300001754195tcnnf:PromissoryNoteOfConsolidatedVariableInterestEntityMaturingFebruaryTwoThousandTwentyNineMonthlyInterestPaymentsDueAtEightPercentMember2022-01-012022-09-300001754195us-gaap:AdditionalPaidInCapitalMember2020-12-310001754195tcnnf:NovemberNotesMember2021-01-012021-09-300001754195us-gaap:CustomerRelationshipsMember2022-09-300001754195tcnnf:LiabilityWarrantsMembertcnnf:HarvestLiabilityWarrantsMember2021-10-012021-10-310001754195us-gaap:PrepaidExpensesAndOtherCurrentAssetsMember2021-12-310001754195srt:MaximumMembertcnnf:OtherLeasedAssetsMember2022-09-300001754195us-gaap:AdditionalPaidInCapitalMember2021-09-300001754195tcnnf:PurepennLlcAndPioneerLeasingAndSolevoEarnoutMembertcnnf:SubordinateVotingSharesMember2022-01-012022-03-310001754195us-gaap:InterestExpenseMember2021-01-012021-09-300001754195tcnnf:PromissoryNoteAcquiredFromHarvestMaturingInNovemberTwoThousandTwentyFiveSecuredByCertainAssetsMember2022-09-300001754195tcnnf:OmnibusIncentivePlanMembertcnnf:DirectorsAndOfficersMembersrt:MinimumMember2022-02-242022-02-240001754195srt:MaximumMemberus-gaap:EmployeeStockOptionMembertcnnf:HarvestHealthAndRecreationIncMember2021-10-012021-10-0100017541952021-10-012021-10-0100017541952022-03-310001754195tcnnf:MultipleVotingSharesMember2021-12-310001754195us-gaap:OtherNonoperatingIncomeExpenseMember2022-01-012022-09-300001754195stpr:PA2019-10-012019-10-310001754195tcnnf:PromissoryNotesMatureInOctoberTwoThousandTwentyTwoMonthlyInterestPaymentsDueOfFourPointSevenFivePercentSecuredByPropertyMember2022-09-300001754195us-gaap:FairValueInputsLevel2Memberus-gaap:MeasurementInputPriceVolatilityMember2022-09-300001754195tcnnf:AnnaHoldingsLLCMember2021-07-080001754195tcnnf:MultipleVotingSharesMember2022-11-030001754195us-gaap:OtherIncomeMember2022-01-012022-09-300001754195tcnnf:MultipleVotingSharesMember2021-09-3000017541952020-12-310001754195tcnnf:PromissoryNotesAcquiredFromHarvestMaturingInFebruaryTwoThousandTwentyTwoSecuredByCertainAssetsMember2021-12-310001754195us-gaap:AccountingStandardsUpdate202108Member2022-09-300001754195tcnnf:CannabisPlantsMember2021-12-310001754195tcnnf:PatientCentricOfMarthasVineyardLimitedMember2021-07-020001754195tcnnf:OmnibusIncentivePlanMembersrt:MinimumMembertcnnf:SelectEmployeesAndCertainBoardMembersMember2021-10-262021-10-260001754195us-gaap:RestrictedStockUnitsRSUMember2021-12-310001754195us-gaap:WarrantMembertcnnf:CertainEmployeesAndDirectorsMember2020-12-310001754195tcnnf:DirectorsAndOfficersMembersrt:MaximumMembertcnnf:StockOptionPlanMember2021-01-042021-01-040001754195tcnnf:MountaineerHoldingLLCMember2021-05-062021-05-060001754195tcnnf:ImpairmentAndDisposalOfLongLivedAssetsMember2022-07-012022-09-300001754195us-gaap-supplement:SoutheastRegionMember2022-01-012022-09-300001754195tcnnf:NaturesRemedyOfMassachusettsIncMember2021-06-302021-06-300001754195us-gaap:LandMember2022-09-300001754195tcnnf:PromissoryNoteMaturingInJulyTwoThousandTwentyThreeMonthlyInterestPaymentsDueAtFourPercentPerAnnumSecuredByCertainAssetsMember2021-12-310001754195tcnnf:EightPercentageSeniorSecuredNotesTrancheTwoMembersrt:MaximumMemberus-gaap:GeneralAndAdministrativeExpenseMember2022-07-012022-09-300001754195us-gaap:FurnitureAndFixturesMember2021-12-310001754195tcnnf:PatientCentricOfMarthasVineyardLimitedMember2021-07-022021-07-020001754195us-gaap-supplement:SoutheastRegionMembertcnnf:ImpairmentAndDisposalOfNonOperatingAssetsMember2022-01-012022-09-300001754195stpr:MA2019-07-012019-07-310001754195us-gaap:RetainedEarningsMember2020-12-310001754195us-gaap:AdditionalPaidInCapitalMember2021-03-310001754195tcnnf:WholesaleLicensingAndOtherMember2021-07-012021-09-300001754195tcnnf:MultipleVotingSharesMember2021-04-012021-06-300001754195stpr:MA2022-09-300001754195us-gaap:CommonStockMember2021-12-310001754195us-gaap:FairValueInputsLevel2Memberus-gaap:MeasurementInputDiscountRateMember2022-09-300001754195tcnnf:ImpairmentAndDisposalOfLongedLivedAssetsNetMember2022-07-012022-09-300001754195stpr:FL2021-12-310001754195srt:MaximumMembertcnnf:SolevoWellnessWestVirginiaLLCMember2021-06-082021-06-080001754195us-gaap:AdditionalPaidInCapitalMember2022-03-310001754195us-gaap:CommonStockMember2022-07-012022-09-300001754195tcnnf:EightPercentageSeniorSecuredNotesMember2021-10-062021-10-060001754195us-gaap:FairValueInputsLevel2Memberus-gaap:MeasurementInputDiscountRateMember2021-12-310001754195tcnnf:PurplemedHealingCenterMember2022-01-012022-09-3000017541952018-12-310001754195tcnnf:PurplemedHealingCenterMember2021-12-280001754195us-gaap:CommonStockMember2022-06-300001754195tcnnf:ScenarioTwoMembersrt:MinimumMemberstpr:PA2019-10-012019-10-310001754195us-gaap:RestrictedStockUnitsRSUMember2021-09-152021-09-150001754195tcnnf:PatientCentricOfMarthasVineyardLimitedMember2021-07-022021-07-020001754195tcnnf:ScenarioTwoMembersrt:MaximumMemberstpr:PA2019-10-012019-10-310001754195tcnnf:GreenhouseWellnessWvDispensariesLimitedLiabilityCompanyMember2022-04-262022-04-260001754195us-gaap:RestrictedStockUnitsRSUMember2021-01-012021-09-300001754195us-gaap:RetainedEarningsMember2022-03-310001754195us-gaap:BuildingAndBuildingImprovementsMember2022-09-300001754195tcnnf:JuneNotesMember2021-07-012021-09-300001754195tcnnf:SuperVotingSharesMember2022-01-012022-09-300001754195srt:MinimumMember2021-09-300001754195srt:MinimumMembertcnnf:HarvestHealthAndRecreationIncMemberus-gaap:TradeNamesMember2021-10-012021-10-010001754195us-gaap:DiscontinuedOperationsDisposedOfBySaleMembertcnnf:NevadaOperationsMember2021-12-310001754195tcnnf:JuneNotesMember2021-01-012021-09-300001754195us-gaap:RestrictedStockUnitsRSUMemberus-gaap:GeneralAndAdministrativeExpenseMember2022-07-012022-09-300001754195tcnnf:MountaineerHoldingLLCMember2021-05-060001754195us-gaap:EmployeeStockOptionMember2022-07-012022-09-300001754195tcnnf:EightPercentageSeniorSecuredNotesMember2021-10-060001754195tcnnf:PromissoryNoteAcquiredInHarvestAcquisitionMaturingInAugustTwoThousandTwentyFourMonthlyInterestPaymentsDueOfTwoPercentSecuredByCertainAssetsMember2021-12-310001754195us-gaap:GeneralAndAdministrativeExpenseMember2021-07-012021-09-300001754195us-gaap:GeneralAndAdministrativeExpenseMember2022-01-012022-09-300001754195tcnnf:PromissoryNotesMatureInOctoberTwoThousandTwentyTwoMonthlyInterestPaymentsDueOfFourPointSevenFivePercentSecuredByPropertyMember2022-01-012022-09-300001754195us-gaap:TradeNamesMembertcnnf:KeystoneShopsMember2021-07-080001754195tcnnf:AnnaHoldingsLLCMember2021-07-082021-07-080001754195tcnnf:DispensaryLicenseMembertcnnf:PurplemedHealingCenterMember2021-12-282021-12-280001754195tcnnf:LiabilityWarrantsMember2021-12-310001754195tcnnf:ConvertibleNoteReceivableDatedNovemberTwoThousandTwentyOneMaturingInNovemberTwoThousandTwentyFourMember2022-09-300001754195us-gaap:FairValueInputsLevel2Memberus-gaap:MeasurementInputPriceVolatilityMember2021-12-310001754195srt:MinimumMembertcnnf:EquityWarrantsMember2021-10-310001754195tcnnf:DispensaryLicenseMembertcnnf:PatientCentricOfMarthasVineyardLimitedMember2021-07-022021-07-020001754195tcnnf:BusinessCombinationContingentConsiderationLiabilityCurrentMemberus-gaap:PendingLitigationMember2021-12-310001754195tcnnf:BusinessCombinationContingentConsiderationLiabilityCurrentMember2021-12-310001754195tcnnf:PurplemedHealingCenterMember2021-12-280001754195tcnnf:SuperVotingSharesMember2021-01-012021-12-310001754195tcnnf:PromissoryNoteAcquiredInHarvestMaturingInAprilTwoThousandTwentySixSecuredByEquipmentPrincipalDueAtMaturityMember2022-09-300001754195us-gaap:AccountsPayableMember2021-01-012021-12-310001754195tcnnf:GreenhouseWellnessWvDispensariesLimitedLiabilityCompanyMember2022-01-012022-09-300001754195us-gaap:AdditionalPaidInCapitalMember2022-06-300001754195us-gaap:SellingAndMarketingExpenseMember2022-01-012022-09-300001754195tcnnf:MultipleVotingSharesMember2021-06-300001754195us-gaap:RestrictedStockUnitsRSUMemberus-gaap:SellingAndMarketingExpenseMember2022-07-012022-09-3000017541952021-12-310001754195tcnnf:KeystoneShopsMember2021-07-012021-09-300001754195tcnnf:SubordinateVotingSharesMember2021-01-012021-12-310001754195tcnnf:EightPercentageSeniorSecuredNotesMember2022-01-012022-09-300001754195us-gaap:AdditionalPaidInCapitalMember2021-07-012021-09-300001754195tcnnf:HarvestHealthAndRecreationIncMember2021-12-310001754195us-gaap:InterestExpenseMember2022-01-012022-09-300001754195tcnnf:HancockMember2021-12-310001754195tcnnf:CostOfGoodsSoldSalesAndMarketingGeneralAndAdministrativeMember2021-01-012021-09-300001754195us-gaap:EmployeeStockOptionMember2022-01-012022-09-300001754195us-gaap:NoncontrollingInterestMember2022-06-300001754195tcnnf:SubordinateVotingSharesMember2022-11-030001754195tcnnf:HarvestHealthAndRecreationIncMembertcnnf:SubordinateVotingSharesWarrantMember2021-10-012021-10-010001754195us-gaap:AdditionalPaidInCapitalMember2022-04-012022-06-300001754195tcnnf:ScenarioThreeMembersrt:MaximumMemberstpr:PA2019-10-012019-10-310001754195tcnnf:PromissoryNotesOfConsolidatedVariableInterestEntitiesAcquiredInHarvestAcquisitionMaturingDecemberTwoThousandTwentyTwoAndTwoThousandTwentyNineMember2022-01-012022-09-300001754195us-gaap:RestrictedStockUnitsRSUMember2022-07-012022-09-300001754195tcnnf:LiabilityWarrantsMember2021-01-012021-12-310001754195tcnnf:MountaineerHoldingLLCMember2021-04-012021-06-300001754195us-gaap:NoncontrollingInterestMember2022-03-3100017541952022-01-012022-09-300001754195us-gaap:CustomerRelationshipsMembertcnnf:HarvestHealthAndRecreationIncMember2021-10-010001754195tcnnf:PromissoryNoteMaturingInOctoberTwoThousandTwentyFourMonthlyInterestPaymentsDueOfFivePointFivePercentPrincipalBalanceDueAtMaturityMember2021-12-310001754195tcnnf:WholesaleLicensingAndOtherMember2022-07-012022-09-300001754195us-gaap:SellingAndMarketingExpenseMember2021-01-012021-09-300001754195us-gaap:ConstructionInProgressMember2022-09-300001754195us-gaap:CommonStockMember2021-09-300001754195us-gaap:SellingAndMarketingExpenseMember2022-07-012022-09-300001754195tcnnf:OmnibusIncentivePlanMembertcnnf:DirectorsAndOfficersMembersrt:MaximumMember2022-01-042022-01-040001754195tcnnf:AlachuaMember2022-01-012022-09-300001754195tcnnf:KeystoneShopsMember2021-07-080001754195us-gaap:FairValueInputsLevel2Membertcnnf:MeasurementInputExchangeRateMember2022-09-300001754195tcnnf:MountaineerHoldingLLCMembertcnnf:CultivationPermitAndDispensaryPermitsMember2021-05-060001754195stpr:PA2021-12-310001754195tcnnf:LiabilityWarrantsMember2022-09-300001754195us-gaap:FairValueInputsLevel2Memberus-gaap:MeasurementInputSharePriceMember2022-09-300001754195tcnnf:Cp4GroupLimitedLiabilityCompanyMember2022-01-012022-09-300001754195stpr:PAtcnnf:ScenarioOneMember2019-10-012019-10-310001754195tcnnf:RealEstateAssetsMembersrt:MaximumMember2022-09-300001754195tcnnf:HarvestHealthAndRecreationIncAndAnnaHoldingsLlcMember2021-01-012021-09-3000017541952021-01-012021-12-310001754195tcnnf:StockOptionPlanMember2022-09-300001754195us-gaap:ConstructionInProgressMember2021-12-3100017541952020-01-012020-12-310001754195stpr:MA2019-07-310001754195us-gaap:WarrantMembertcnnf:HarvestHealthAndRecreationIncMember2021-10-012021-10-010001754195tcnnf:HarvestHealthAndRecreationIncAndAnnaHoldingsLlcMember2021-07-012021-09-300001754195tcnnf:SubordinateVotingSharesMember2022-01-012022-03-310001754195us-gaap:AdditionalPaidInCapitalMember2021-04-012021-06-300001754195tcnnf:HancockMember2021-10-012021-10-310001754195tcnnf:GreenhouseWellnessWvDispensariesLimitedLiabilityCompanyMembertcnnf:FavorableLeaseholdInterestsMember2022-04-260001754195tcnnf:PromissoryNoteAcquiredFromHarvestMaturingInNovemberTwoThousandTwentyFiveSecuredByCertainAssetsMember2021-10-310001754195us-gaap:NoncontrollingInterestMember2022-09-300001754195us-gaap:TradeNamesMember2021-12-310001754195us-gaap:TradeNamesMember2022-09-300001754195us-gaap:AdditionalPaidInCapitalMembertcnnf:SolevoWellnessWestVirginiaLLCMember2021-04-012021-06-300001754195us-gaap:AdditionalPaidInCapitalMember2021-06-300001754195us-gaap:GeneralAndAdministrativeExpenseMemberus-gaap:RestrictedStockUnitsRSUMember2022-01-012022-09-300001754195us-gaap:AdditionalPaidInCapitalMember2021-01-012021-03-310001754195tcnnf:NovemberNotesMember2019-01-012019-12-310001754195us-gaap:TrademarksMember2022-09-300001754195tcnnf:EightPercentageSeniorSecuredNotesTrancheTwoMembersrt:MaximumMemberus-gaap:GeneralAndAdministrativeExpenseMember2022-01-012022-09-300001754195tcnnf:KeystoneShopsMembertcnnf:DispensaryLicenseMember2021-07-0800017541952021-01-012021-09-300001754195us-gaap:NoncontrollingInterestMember2021-12-310001754195stpr:MA2021-12-310001754195tcnnf:PromissoryNoteMaturingInJulyTwoThousandTwentyThreeMonthlyInterestPaymentsDueAtFourPercentPerAnnumSecuredByCertainAssetsMember2022-01-012022-09-300001754195us-gaap:AdditionalPaidInCapitalMember2022-01-012022-03-310001754195us-gaap:EmployeeStockOptionMember2021-07-012021-09-300001754195tcnnf:ImpairmentAndDisposalOfLongLivedAssetsMember2022-01-012022-09-300001754195tcnnf:PromissoryNoteAcquiredInHarvestAcquisitionMaturingInMayTwoThousandTwentyThreeQuarterlyInterestPaymentsDueOfTwoPercentMember2022-09-300001754195tcnnf:RealEstateAssetsMembersrt:MinimumMember2022-09-300001754195tcnnf:SubordinateVotingSharesMember2021-03-310001754195tcnnf:HarvestHealthAndRecreationIncMembertcnnf:MultipleVotingSharesWarrantsMember2021-10-012021-10-010001754195tcnnf:PromissoryNotesMatureInDecemberTwoThousandTwentyTwoMonthlyVariableInterestPaymentsDueOfSevenPointZeroPercentSecuredByPropertyMember2022-09-3000017541952018-01-012018-12-310001754195tcnnf:ConvertibleNoteReceivableDatedNovemberTwoThousandTwentyOneMaturingInNovemberTwoThousandTwentyFourMember2021-12-310001754195us-gaap:VehiclesMember2021-12-310001754195tcnnf:GreenhouseWellnessWvDispensariesLimitedLiabilityCompanyMembertcnnf:DispensaryLicenseMember2022-04-262022-04-260001754195srt:MaximumMembertcnnf:HarvestHealthAndRecreationIncMemberus-gaap:TradeNamesMember2021-10-012021-10-010001754195srt:MinimumMember2022-09-300001754195tcnnf:WalkinsMember2022-01-012022-09-300001754195tcnnf:OmnibusIncentivePlanMembersrt:MaximumMembertcnnf:SelectEmployeesAndCertainBoardMembersMember2021-10-262021-10-260001754195tcnnf:GreenhouseWellnessWvDispensariesLimitedLiabilityCompanyMember2022-04-2600017541952021-06-300001754195tcnnf:JuneNotesMember2019-12-310001754195us-gaap:GeneralAndAdministrativeExpenseMember2022-07-012022-09-300001754195us-gaap:LandMember2021-12-310001754195tcnnf:ImpairmentAndDisposalOfNonOperatingAssetsMember2022-07-012022-09-30iso4217:CADxbrli:sharesxbrli:purexbrli:sharesiso4217:USDxbrli:sharestcnnf:Officerstcnnf:Votetcnnf:Optioniso4217:USD

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

 

FORM 10-Q

 

(Mark One)

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2022

OR

 

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the transition period from to

Commission File Number: 000-56248

 

img6211418_0.jpg 

TRULIEVE CANNABIS CORP.

(Exact Name of Registrant as Specified in its Charter)

 

 

British Columbia

84-2231905

(State or other jurisdiction of

incorporation or organization)

(I.R.S. Employer
Identification No.)

 

 

6749 Ben Bostic Road

Quincy, FL

32351

(Address of principal executive offices)

(Zip Code)

 

Registrant’s telephone number, including area code: (850) 480-7955

 

Securities registered pursuant to Section 12(b) of the Act: None

 

Title of each class

 

Trading

Symbol(s)

 

Name of each exchange on which registered

N/A

 

N/A

 

N/A

 

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer

 

 

Accelerated filer

 

 

 

 

 

 

 

 

Non-accelerated filer

 

 

Smaller reporting company

 

 

 

 

 

 

 

 

Emerging growth company

 

 

 

 

 

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No

As of November 3, 2022, the registrant had 159,645,155 Subordinate Voting Shares and 26,235,054 Multiple Voting Shares (on an as converted basis) outstanding.

 

 


Trulieve Cannabis Corp.

 

Table of Contents

 

 

 

Page

PART I.

FINANCIAL INFORMATION

 

Item 1.

Financial Statements (Unaudited)

1

 

Condensed Consolidated Balance Sheets as of September 30, 2022 and December 31, 2021

1

 

Condensed Consolidated Statements of Operations and Comprehensive (Loss) Income for the three and nine months ended September 30, 2022 and 2021

2

 

Condensed Consolidated Statements of Changes in Shareholders’ Equity for the three and nine months ended September 30, 2022 and 2021

3

 

Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, 2022 and 2021

5

 

Notes to Condensed Consolidated Financial Statements

7

Item 2.

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

40

Item 3.

Quantitative and Qualitative Disclosures About Market Risk

50

Item 4.

Controls and Procedures

50

 

 

 

PART II.

OTHER INFORMATION

 

Item 1.

Legal Proceedings

54

Item 1A.

Risk Factors

54

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds

54

Item 3.

Defaults Upon Senior Securities

54

Item 4.

Controls and Procedures

54

Item 5.

Other Information

54

Item 6.

Exhibits

55

 

Signatures

56

 

 

i


CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

 

This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of safe harbor provisions of the Private Securities Litigation Reform Act of 1995. In some cases, you can identify these statements by forward-looking words such as “may”, “will”, “would”, “could”, “should”, “believes”, “estimates”, “projects”, “potential”, “expects”, “plans”, “intends”, “anticipates”, “targeted”, “continues”, “forecasts”, “designed”, “goal”, or the negative of those words or other similar or comparable words. Any statements contained in this Quarterly Report on Form 10-Q that are not statements of historical facts may be deemed to be forward-looking statements. We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our business, financial condition, results of operations and future growth prospects. The forward-looking statements contained herein are based on certain key expectations and assumptions, including, but not limited to, with respect to expectations and assumptions concerning receipt and/or maintenance of required licenses and third party consents and the success of our operations, are based on estimates prepared by us using data from publicly available governmental sources, as well as from market research and industry analysis, and on assumptions based on data and knowledge of this industry that we believe to be reasonable. These forward-looking statements are not guarantees of future performance or development and involve known and unknown risks, uncertainties and other factors that are in some cases beyond our control. As a result, any or all of our forward-looking statements in this Quarterly Report on Form 10-Q may turn out to be inaccurate. Factors that may cause actual results to differ materially from current expectations include, among other things, those listed under “Risk Factors” and discussed elsewhere in this Quarterly Report on Form 10-Q and in “Part I, Item 1A – Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2021. These forward-looking statements speak only as of the date of this Quarterly Report on Form 10-Q. Except as required by law, we assume no obligation to update or revise these forward-looking statements for any reason, even if new information becomes available in the future. You should, however, review the factors and risks we describe in the reports we will file from time to time with the SEC after the date of this Quarterly Report on Form 10-Q.

 

ii


PART I—FINANCIAL INFORMATION

Item 1. Financial Statements.

Trulieve Cannabis Corp.

Condensed Consolidated Balance Sheets (Unaudited)

(in thousands, except per share data)

 

 

 

September 30, 2022

 

 

December 31, 2021

 

ASSETS

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

Cash and cash equivalents

 

$

114,468

 

 

$

230,085

 

Restricted cash

 

 

 

 

 

3,013

 

Accounts receivable, net

 

 

11,309

 

 

 

8,563

 

Inventories, net

 

 

301,239

 

 

 

209,943

 

Notes receivable - current portion

 

 

715

 

 

 

1,530

 

Prepaid expenses and other current assets

 

 

62,068

 

 

 

68,145

 

Assets associated with discontinued operations

 

 

2,838

 

 

 

3,615

 

Total current assets

 

 

492,637

 

 

 

524,894

 

Property and equipment, net

 

 

795,506

 

 

 

779,413

 

Right of use assets - operating, net

 

 

100,864

 

 

 

111,723

 

Right of use assets - finance, net

 

 

75,305

 

 

 

66,764

 

Intangible assets, net

 

 

1,027,058

 

 

 

1,081,240

 

Goodwill

 

 

791,495

 

 

 

765,358

 

Notes receivable, net

 

 

12,059

 

 

 

12,147

 

Other assets

 

 

21,531

 

 

 

17,640

 

Long-term assets associated with discontinued operations

 

 

4,503

 

 

 

52,167

 

TOTAL ASSETS

 

$

3,320,958

 

 

$

3,411,346

 

LIABILITIES

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

Accounts payable and accrued liabilities

 

 

87,773

 

 

 

93,801

 

Income tax payable

 

 

4,681

 

 

 

28,084

 

Deferred revenue

 

 

6,385

 

 

 

7,168

 

Notes payable - current portion, net

 

 

4,823

 

 

 

10,052

 

Operating lease liabilities - current portion

 

 

10,779

 

 

 

10,020

 

Finance lease liabilities - current portion

 

 

8,719

 

 

 

6,185

 

Construction finance liabilities - current portion

 

 

1,137

 

 

 

991

 

Contingencies

 

 

25,590

 

 

 

13,017

 

Liabilities associated with discontinued operations

 

 

390

 

 

 

92

 

Total current liabilities

 

 

150,277

 

 

 

169,410

 

Long-term liabilities:

 

 

 

 

 

 

Notes payable

 

 

7,942

 

 

 

6,456

 

Private placement notes, net

 

 

540,301

 

 

 

462,929

 

Warrant liabilities

 

 

268

 

 

 

2,895

 

Operating lease liabilities

 

 

110,625

 

 

 

107,570

 

Finance lease liabilities

 

 

75,011

 

 

 

65,244

 

Construction finance liabilities

 

 

182,257

 

 

 

175,198

 

Deferred tax liabilities

 

 

220,206

 

 

 

241,882

 

Other long-term liabilities

 

 

8,616

 

 

 

8,400

 

Long-term liabilities associated with discontinued operations

 

 

14,575

 

 

 

23,989

 

TOTAL LIABILITIES

 

 

1,310,078

 

 

 

1,263,973

 

Commitments and contingencies (see Note 22)

 

 

 

 

 

 

SHAREHOLDERS' EQUITY

 

 

 

 

 

 

Common stock, no par value; unlimited shares authorized. 185,880,209 issued and outstanding as of September 30, 2022 and 180,504,172 issued and outstanding as of December 31, 2021.

 

 

 

 

 

 

Additional paid-in-capital

 

 

2,041,748

 

 

 

2,008,100

 

Accumulated (deficit) earnings

 

 

(31,299

)

 

 

137,721

 

Non-controlling interest

 

 

431

 

 

 

1,552

 

TOTAL SHAREHOLDERS' EQUITY

 

 

2,010,880

 

 

 

2,147,373

 

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY

 

$

3,320,958

 

 

$

3,411,346

 

 

The accompanying notes are an integral part of these condensed consolidated financial statements.

 

1


Trulieve Cannabis Corp.

Condensed Consolidated Statements of Operations and Comprehensive (Loss) Income (Unaudited)

(in thousands, except per share data)

 

 

 

Three Months Ended

 

 

Nine Months Ended

 

 

 

September 30, 2022

 

 

September 30, 2021

 

 

September 30, 2022

 

 

September 30, 2021

 

Revenues, net of discounts

 

$

300,793

 

 

$

224,092

 

 

$

937,612

 

 

$

633,037

 

Cost of goods sold

 

 

132,760

 

 

 

70,147

 

 

 

405,278

 

 

 

199,345

 

   Gross profit

 

 

168,033

 

 

 

153,945

 

 

 

532,334

 

 

 

433,692

 

Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

Sales and marketing

 

 

75,915

 

 

 

51,724

 

 

 

224,026

 

 

 

142,858

 

General and administrative

 

 

37,646

 

 

 

28,223

 

 

 

104,840

 

 

 

55,874

 

Depreciation and amortization

 

 

30,190

 

 

 

7,728

 

 

 

88,645

 

 

 

19,829

 

Impairment and disposal of long-lived assets, net

 

 

52,035

 

 

 

(5

)

 

 

70,151

 

 

 

(5

)

Total expenses

 

 

195,786

 

 

 

87,670

 

 

 

487,662

 

 

 

218,556

 

  (Loss) Income from operations

 

 

(27,753

)

 

 

66,275

 

 

 

44,672

 

 

 

215,136

 

Other income (expense):

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense, net

 

 

(19,264

)

 

 

(6,145

)

 

 

(56,815

)

 

 

(20,693

)

Change in fair value of derivative liabilities - warrants

 

 

365

 

 

 

 

 

 

2,627

 

 

 

 

Impairment and disposal of non-operating assets, net

 

 

(2,604

)

 

 

 

 

 

(6,004

)

 

 

 

Other income (expense), net

 

 

448

 

 

 

89

 

 

 

3,016

 

 

 

385

 

Total other expense

 

 

(21,055

)

 

 

(6,056

)

 

 

(57,176

)

 

 

(20,308

)

  (Loss) Income before provision for income taxes

 

 

(48,808

)

 

 

60,219

 

 

 

(12,504

)

 

 

194,828

 

Provision for income taxes

 

 

28,199

 

 

 

41,603

 

 

 

116,742

 

 

 

105,254

 

   Net (loss) income from continuing operations and comprehensive (loss) income

 

 

(77,007

)

 

 

18,616

 

 

 

(129,246

)

 

 

89,574

 

   Net loss from discontinued operations, net of tax benefit of $12,981, $ - , $14,439, and $-, respectively

 

 

(38,065

)

 

 

 

 

 

(42,329

)

 

 

 

Net (loss) income

 

 

(115,072

)

 

 

18,616

 

 

 

(171,575

)

 

 

89,574

 

   Less: Net loss and comprehensive loss attributable to non-controlling interest from continuing operations

 

 

(518

)

 

 

 

 

 

(2,555

)

 

 

 

   Net (loss) income and comprehensive (loss) income attributable to common shareholders

 

$

(114,554

)

 

$

18,616

 

 

$

(169,020

)

 

$

89,574

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net (loss) income per share - Continuing operations:

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

(0.41

)

 

$

0.15

 

 

$

(0.68

)

 

$

0.73

 

Diluted

 

$

(0.41

)

 

$

0.14

 

 

$

(0.68

)

 

$

0.68

 

Net loss per share - Discontinued operations:

 

 

 

 

 

 

 

 

 

 

 

 

Basic and diluted

 

$

(0.20

)

 

 

 

 

$

(0.23

)

 

 

 

Weighted average number of common shares used in computing net (loss) income per share:

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

188,597,094

 

 

 

128,146,298

 

 

 

187,549,359

 

 

 

122,983,729

 

Diluted

 

 

188,597,094

 

 

 

136,909,266

 

 

 

187,549,359

 

 

 

130,927,083

 

 

The accompanying notes are an integral part of these condensed consolidated financial statements.

 

2


Trulieve Cannabis Corp.

Condensed Consolidated Statements of Changes in Shareholders’ Equity (Unaudited)

(in thousands, except per share data)

 

 

 

Super Voting Shares

 

 

Multiple Voting Shares

 

 

Subordinate Voting Shares

 

 

Total Common Shares

 

 

Additional Paid-in-Capital

 

 

Accumulated (Deficit) Earnings

 

 

Non-Controlling Interest

 

 

Total

 

Balance, January 1, 2022 (audited)

 

 

 

 

 

51,916,999

 

 

 

128,587,173

 

 

 

180,504,172

 

 

 

2,008,100

 

 

 

137,721

 

 

 

1,552

 

 

 

2,147,373

 

Share-based compensation

 

 

 

 

 

 

 

 

 

 

 

 

 

 

4,564

 

 

 

 

 

 

 

 

 

4,564

 

Exercise of stock options

 

 

 

 

 

 

 

 

45,775

 

 

 

45,775

 

 

 

108

 

 

 

 

 

 

 

 

 

108

 

Shares issued for cash - warrant exercise

 

 

 

 

 

 

 

 

1,648

 

 

 

1,648

 

 

 

22

 

 

 

 

 

 

 

 

 

22

 

Shares issued under share compensation plans

 

 

 

 

 

 

 

 

16,257

 

 

 

16,257

 

 

 

 

 

 

 

 

 

 

 

 

-

 

Tax withholding related to net share settlements of equity awards

 

 

 

 

 

 

 

 

(10,005

)

 

 

(10,005

)

 

 

(230

)

 

 

 

 

 

 

 

 

(230

)

Conversion of Multiple Voting to Subordinate Voting Shares

 

 

 

 

 

(2,699,100

)

 

 

2,699,100

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Shares issued for PurePenn, Pioneer, and Solevo earnouts

 

 

 

 

 

 

 

 

3,626,295

 

 

 

3,626,295

 

 

 

 

 

 

 

 

 

 

 

 

 

Distribution

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(50

)

 

 

(50

)

Divestment of variable interest entity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(111

)

 

 

(111

)

Net loss and comprehensive loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(31,975

)

 

 

(507

)

 

 

(