Executive Chairman Louisa Mojela Terminated for
Cause
Akanda Corp. ("Akanda" or the “Company”) (NASDAQ: AKAN), an
international medical cannabis platform company, today announced
that the High Court of Lesotho (the “Lesotho Court”) has placed in
liquidation the Company’s indirect, wholly-owned subsidiary,
Bophelo Bio Science & Wellness (Pty) Ltd. (“Bophelo”). The
action to place Bophelo in liquidation was taken by the Lesotho
Court pursuant to an unauthorized application and request (the
“Liquidation Application”) that was filed by Louisa Mojela, the
former Executive Chairman of Akanda, who was recently terminated as
Executive Chairman of Akanda, and the Mophuti Matsoso Development
Trust (“MMD Trust”), which the Company believes was established by
Ms. Mojela.
Tej Virk, the Chief Executive Officer of Akanda, stated, “The
application that was filed by Ms. Mojela to place Bophelo, our
wholly-owned subsidiary, in liquidation was taken without Akanda’s
prior authorization, knowledge or consent. We therefore have reason
to believe that Ms. Mojela’s actions reflect her efforts to
retaliate against the Company in response to her dismissal and
removal from the Board of Directors of Akanda on June 23, 2022, on
the basis of a lack of focus on profitability under her leadership.
It is appalling that Ms. Mojela would take the extraordinary and
significant action of seeking to cause Bophelo to be declared
insolvent without consulting with, or obtaining the consent of, the
Board of Directors or the senior management team of Akanda, which
is the beneficial owner of 100% of Bophelo’s equity interests, or
even of the full Board of Directors of Bophelo itself.”
Akanda intends to convene a special committee to investigate Ms.
Mojela’s actions and conduct, including actions and conduct taken
by her prior to her filing of the Liquidation Application, and will
pursue all of its available legal rights and remedies against Ms.
Mojela and the MMD Trust for taking this unauthorized action. The
Company also intends to contest and seek to reverse the
determination by the Lesotho Court to place Bophelo in liquidation.
In addition, Akanda will seek to recover significant loans that it
has made to Bophelo to fund the execution of Bophelo’s business
plan, including payment of rents and staffing costs, in the event
that the Lesotho Court does not reverse its determination to place
Bophelo in liquidation. Finally, Ms. Mojela has been summarily
terminated as Chairman of Bophelo for Cause, as a “bad leaver”, as
a result of her improper and unauthorized action to seek to place
Bophelo in liquidation.
In an action taken without the Company’s knowledge, the Lesotho
Court has ordered an insolvent liquidation of Bophelo, and has
appointed Mr. Chavonnes Cooper of Cape Town, South Africa, as
liquidator of Bophelo for purposes of maintaining the value of the
assets owned or managed by Bophelo. The order was signed by the
Honorable Mr. Justice Mokhesi on July 15, 2022.
Located near T’sakholo in the Mafeteng District of the Kingdom
of Lesotho, Bophelo is one of the largest licensed landholders
engaging in cannabis cultivation in the country. It leases the
premises on which it operates from the MMD Trust, pursuant to a
long-term agreement.
Bophelo’s operations consist primarily of a Good Agricultural
and Collection Practices (GACP) qualified hoop house and shade
cloth outdoor grow site, which completed its first harvest in May
2022. It is generating attributed run-rate operating losses of
approximately $2 million annually and was previously budgeted to
receive nearly $2.5 million of capital investment in 2022 to
construct a 2.5-acre Cravo green house for the 2023 growing
season.
Mr. Virk further stated, “Akanda believes that in this
situation, Ms. Mojela, our former Executive Chairman, failed to
consider or act in the best interests of either Akanda or our
shareholders. We intend to reclaim what rightfully belongs to
Akanda shareholders, which includes the Akanda Bokamoso Empowerment
Trust, which was established to support our hard working and loyal
staff at the Bophelo campus in Lesotho. While doing so, we remain
committed to our mission of helping people lead better lives
through improved access to high quality medical cannabis
products.”
Continued Mr. Virk, “Having a presence in Africa was always
about building for the long-term and making a social impact on our
communities. In May 2022, Akanda acquired Portugal-based Holigen,
an EU GMP certified medical cannabis producer, which has the means
to potentially contribute profits to Akanda over the next six to
nine months. With Holigen, Akanda believes it has more than
sufficient capacity to produce premium quality indoor, outdoor and
greenhouse medical cannabis within the European Union as the market
matures. Additionally, with shifting market dynamics, we have found
higher demand from German and UK customers for product produced in
Portugal than Lesotho due to evolving EU regulations. In the event
we are unable to reverse the determination of the Lesotho Court,
Akanda may actually experience considerable savings and greater
profitability as a result of reduced expenditures and the
elimination of losses associated with Bophelo’s operations.”
Concluding, Mr. Virk stated, “Financially, the reality is that,
an Akanda, without Bophelo, is on an accelerated path to
profitability and positive free cash flow. As a team, we are
focused on our core markets in the UK and Europe, and are already
executing on a number of commercial sales agreements, all of which
will leverage our Portuguese operations. Despite these realities,
Akanda remains committed to Bophelo, its employees and the
longer-term ramp-up of cannabis markets in Africa.”
About Akanda Corp.
Akanda (NASDAQ: AKAN) is an international medical cannabis and
wellness platform company seeking to help people lead better lives
through improved access to high quality and affordable products.
Akanda’s portfolio includes Bophelo Bioscience & Wellness, a
GACP qualified cultivation campus in the Kingdom of Lesotho in
Southern Africa; Holigen, a Portugal-based cultivator, manufacturer
and distributor with a prized EU GMP certified indoor grow
facility; and CanMart, a UK-based fully licensed pharmaceutical
importer and distributor which supplies pharmacies and clinics
within the UK. The company’s seed-to-patient supply chain also
includes partnerships with Cellen Life Sciences’ Leva Clinic, one
of the first fully digital pain clinics in the UK, and Cantourage,
which operates a platform for bringing medical cannabis to
Europe.
Connect with Akanda: Email | Website | LinkedIn | Twitter |
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Cautionary Note Regarding Forward-Looking Information and
Statements
This press release contains certain "forward-looking
information" within the meaning of applicable securities
legislation in Canada and the United States and may also contain
statements that may constitute "forward-looking statements" within
the meaning of the safe harbor provisions of the United States
Private Securities Litigation Reform Act of 1995. Such
forward-looking information and forward-looking statements are not
representative of historical facts or information or current
condition, but instead represent only Akanda's beliefs regarding
future events, plans or objectives, many of which, by their nature,
are inherently uncertain and outside of Akanda's control.
Generally, such forward-looking information or forward-looking
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or variations of such words and phrases or may contain statements
that certain actions, events or results "may", "could", "would",
"might" or "will be taken", "will continue", "will occur" or "will
be achieved." Forward-looking information may relate to anticipated
events or results including, but not limited to business strategy,
product development, market changes and sales and growth plans. The
forward-looking information and forward-looking statements
contained in this press release are made as of the date of this
press release, and Akanda does not undertake to update any
forward-looking information and/or forward-looking statements that
are contained or referenced herein, except in accordance with
applicable securities laws.
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version on businesswire.com: https://www.businesswire.com/news/home/20220726006192/en/
Investors Matt Chesler, CFA FNK IR
ir@akandacorp.com
Media Imogen Saunders Irvine
Partners imogen@irvinepartners.co.uk
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