Malta’s Parliament Approves Legislation to Legalize Adult-Use Cannabis


2021-12-15 22:28:00 Business Times


As a cannabis company, secured debt may be your only option for a line of credit or for funding the evolution of your business. Secured debt is where the lender takes a lien against either all assets or a particular set assets of a borrower as collateral for a loan. As can be imagined, trudging blindly into this type of debt can sink your business. Moreover, there are particular concerns when cannabis companies incur secured debt. Increasingly, experienced secured debt lenders are entering this space, but a significant portion of those potential partners remain prohibited by federal law from participating in cannabis company debt. In the meantime, it falls disproportionately on cannabis companies to educate and steward and carefully consider potential debt partners. Unless you have been active in the space before, it is going to be hard for you to judge what is right, wrong or weird without trusted advisors. The responsibilities between a borrower and the lender are commonly misunderstood. It is not an equal (or close to equal) partnership, which is the universal issue of this article. If you incur secured debt, it is your responsibility to understand that your lender has a right to your collateral—a right that is superior to rights of all others. The consequence of misunderstanding this relationship can be the lender calling default on your loan. Grasping this responsibility involves two important concepts under Article 9 of the Uniform Commercial Code (UCC): (1) Attachment: This pertains to how a security interest grant is enforceable against the borrower, requiring the occurrence of each of the following events: (i) the borrower receives value for the grant; (ii) the borrower has rights in the collateral; and (iii) the secured lender receives a grant in the collateral, usually pursuant to a written security agreement; and (2) Perfection: This pertains to how a secured lender’s security interest has priority to all other creditors. With respect to secured debt, it is easier to ensure attachment when working with a trusted attorney. Following the elements above, here’s what happens: (i) You receive value in a secured debt transaction through a loan of funds or the promise to access to a loan of funds, (ii) you typically have rights in the collateral, but an attorney will help investigate potential issues, and (iii) the transaction documents should contain a specific grant of collateral as required under the UCC, but there are other methods to receive a grant. Here is where you will run into your initial problem as a cannabis company. Except in limited instances, including in Oregon and Maryland, legal regimes prohibit cannabis companies from granting a security interest in the applicable license and/or cannabis. Poof, your two most valuable assets–the right to engage in the cannabis industry and your inventory–are eliminated from the collateral package offered to lenders. So, what else might a business have to offer? You will need to frame discussions with your lender to highlight the values on your balance sheet in equipment, land or other assets, and your attorney needs to make it clear that the license and inventory is excluded from the collateral package. You can alleviate lender' concerns on losing the value in the license and inventory if you pledge the equity of the entities holding licenses and consequently inventory. A pledge of equity is a security interest but is a reference to equity (membership interests, shares, etc.) that has value only to the extent the obligations of the direct creditors of the issuing entity are paid and has particular rules. Naturally, a secured lender’s attempts to enforce a pledge cause other issues involving ownership change under applicable regulatory regimes. Depending on the regulatory regime, a lender taking ownership of equity of a licensed cannabis entity upon foreclosure is likely reportable and subject to consent of the applicable regulatory body, which will likely include burdensome and time-consuming compliance requirements such as extensive background checks on the lender and its affiliates. Thusly, this avenue may not be desirable for or a convincing point to your lender. Your lender is not in the cannabis business–they are in the money business. Consequently, a secured lender may involve a trustee or an agent to act on their behalf such that the secured lender would not hold the equity or other assets of a cannabis company. But, you will more than likely pay the fees of these trustees and agents as a condition to the debt transaction. In addition, some of our clients are having difficulties securing a trustee or agent due to a lack of available options. So, timing can be a concern here if you are targeting a quick closing. Next, perfection of a security interest is specific to the type of assets subject to the security interest. Generally, a security interest is perfected by one of the following methods: Filing a financing statement covers most typical business assets, such as inventory, equipment and general intangibles. The failure to file a financing statement or failure to do so correctly is one of the common ways other creditors (but because of federal limitations, probably not a bankruptcy trustee) poke through the priority of a secured lender. Therefore, it’s important to have a trained eye who will ensure that a financing statement adequately and correctly names the debtor, the secured party and the collateral and a responsible party to file them. In this regard, you should consider how collateral is described in financing statements. As these financing statements are of public record, it is suggested that the collateral description explicitly exclude cannabis licenses and inventory. Lastly, you should consider what financing statements have been filed by others on your UCC record. This is typically done as a part of due diligence by the lender, and you may be required to clean up certain filings as a condition to the debt transaction. Another wrinkle with respect to your efforts toward perfection comes up with respect deposit accounts (i.e., bank accounts). A security interest in deposit accounts is perfected by control, and the means to do that is by the secured party, the debtor and the applicable financial institution entering into a deposit account control agreement.  It is a typical condition to a secured debt transaction that the borrower and the applicable bank enter into a deposit account control agreement in favor of the lender prior to closing the debt transaction or within a period of time post-closing. Large banks typically have a department that handles these requests and the process is relatively smooth. But because of the current federal banking regulatory stance, you do not have access to those banks. Instead, you are likely relying on smaller credit unions or community banks willing to provide banking services to cannabis companies that have no experience with deposit account control agreements. In more than one instance, such institutions have refused to execute a deposit account control agreement. This puts you at risk for not complying with your loan agreement and would likely require moving all funds to a new, willing financial institution. Depending on the loan agreement’s contents, failure to execute a deposit account control agreement typically may put you in default. Confirming your bank’s position on this issue well in advance of a loan transaction would help manage this issue. Some of our clients have had extreme difficulty finding alternative banking partners because of the outright refusal to enter into a deposit account control agreement by some of their prior banking partners. Not all cannabis companies are alike, but nearly all desire more access to capital. Secured debt presents its advantages and disadvantages, which can be enhanced or avoided based upon careful review, consideration and negotiation. As the above may have shown, it takes effort from a you, your trusted advisers and experienced debt partners for debt to elevate your business rather than dragging it into the murk. JT Schuweiler is an attorney at Fox Rothschild, where he advises clients on complex financial transactions. He frequently works with early stage companies especially in the cannabis sector.
作为一个大麻公司,担保债务可能是您唯一的选择,以信贷额度或为您的业务发展提供资金。 担保债务是指贷款人对借款人的所有资产或特定资产取得留置权,作为贷款的抵押品。可以想象,盲目地陷入这种类型的债务会让你的业务陷入困境。此外,当大麻公司产生担保债务时,人们特别担心。 越来越多有经验的担保债务放款人进入这一领域,但这些潜在合作伙伴中的很大一部分仍然被联邦法律禁止参与大麻公司的债务。与此同时,大麻公司承担了不成比例的教育和管理以及仔细考虑潜在债务伙伴的责任。除非你以前活跃在这个领域,否则如果没有值得信任的顾问,你很难判断什么是对的,什么是错的,什么是奇怪的。 借款人和贷款人之间的责任通常被误解。它不是一种平等(或接近平等)的伙伴关系,这是本文的普遍性问题。如果你产生了担保债务,你有责任理解你的贷款人对你的抵押品有权利--这种权利优于所有其他人的权利。 误解这种关系的后果可能是贷款人要求拖欠你的贷款。 把握这一责任涉及《统一商法典》第9条下的两个重要概念: (1)附件:这涉及担保权益授予如何可对借款人强制执行,要求发生下列每一事件:(i)借款人收到授予的价值;(ii)借款人对抵押品享有权利;以及(iii)有担保贷款人通常根据书面担保协议获得抵押品中的授予;和 (2)完善性:这涉及有担保贷款人的担保权益如何优先于所有其他债权人。 关于有担保的债务,在与信任的律师合作时,更容易确保依恋。以下是发生的情况:(i)您通过资金贷款或获得资金贷款的承诺在担保债务交易中获得价值,(ii)您通常对抵押品有权利,但律师将帮助调查潜在的问题,(iii)交易文件应包含UCC要求的特定抵押品授予,但有其他方法获得授予。 在这里,你会遇到你作为一个大麻公司的最初问题。 除俄勒冈州和马里兰州等少数情况外,法律制度禁止大麻公司授予适用许可证和/或大麻的担保权益。噗,你最有价值的两项资产--从事大麻行业的权利和你的库存--从提供给贷款人的抵押品包中消失了。 那么,企业还能提供什么呢?您需要与您的贷款人进行讨论,以突出您的资产负债表上设备、土地或其他资产的价值,您的律师需要明确说明许可证和库存不包括在抵押品包中。 如果您将持有许可证和存货的实体的股权质押,您可以减轻贷款人对许可证和存货价值损失的担忧。股权质押是一种担保权益,但指的是股权(成员资格权益、股份等),只有在发行实体的直接债权人的债务得到偿付的情况下才有价值,并有特定的规则。 自然,有担保贷款人强制执行质押的努力会引起其他涉及适用监管制度下所有权变更的问题。根据监管制度,贷款人在取消抵押品赎回权时获得许可大麻实体股权的所有权可能是可报告的,并须经适用的监管机构同意,这可能包括繁琐和耗时的合规要求,如对贷款人及其附属机构进行广泛的背景调查。因此,这条途径对你的贷款人来说可能不是可取的或令人信服的。你的贷款人不是做大麻生意的--他们是做货币生意的。 因此,有担保放款人可能会让受托人或代理人代表他们行事,以便有担保放款人不会持有大麻公司的股权或其他资产。但是,你很可能会支付这些受托人和代理人的费用,作为债务交易的条件。此外,我们的一些客户由于缺乏可用的选择而难以获得受托人或代理人。因此,如果你的目标是快速关闭,时机可能是一个问题。 其次,担保物权的完善是特定于受担保物权支配的资产类型的。 通常,担保权益通过下列方法之一完善: 提交融资报表涉及最典型的企业资产,如库存品、设备和一般无形资产。未能提交融资声明或未能正确提交融资声明是其他债权人(但由于联邦的限制,可能不是破产受托人)窥探有担保贷款人优先权的常见方式之一。因此,重要的是要有一个训练有素的眼睛,他将确保融资报表充分和正确地列出债务人、担保权人和担保品的名称,以及提交这些名称的责任方。在这方面,你应该考虑在融资报表中如何描述抵押品。由于这些融资报表是公开记录的,建议在担保说明中明确排除大麻许可证和库存。 最后,你应该考虑你的UCC记录中的其他财务报表。这通常是作为尽职调查的一部分由贷款人,你可能需要清理某些文件作为债务交易的条件。 关于你追求完美的努力的另一个皱纹是关于存款账户(即银行账户)。通过控制完善存款账户上的担保权益,实现这一目的的手段是由有担保权人、债务人和适用的金融机构订立存款账户控制协议。担保债务交易的一个典型条件是,借款人和适用的银行在债务交易结束前或结束后的一段时间内订立有利于贷款人的存款账户控制协议。 大型银行通常有一个部门处理这些请求,过程相对平稳。但由于目前联邦银行监管的立场,你无法进入这些银行。相反,你可能依赖较小的信用社或社区银行,这些银行愿意向没有存款账户控制协议经验的大麻公司提供银行服务。 在不止一个例子中,这些机构拒绝执行存款账户控制协议。这会让你面临不遵守贷款协议的风险,并可能需要将所有资金转移到一个新的、愿意的金融机构。根据贷款协议的内容,未能执行存款账户控制协议通常可能会使您违约。在贷款交易之前确认你的银行在这个问题上的立场将有助于管理这个问题。我们的一些客户很难找到其他银行合作伙伴,因为他们的一些以前的银行合作伙伴断然拒绝订立存款账户控制协议。 并非所有的大麻公司都一样,但几乎所有的公司都希望获得更多的资本。担保债务有其优点和缺点,在仔细审查、审议和谈判的基础上,这些优点和缺点可以得到加强或避免。正如以上所示,你、你信任的顾问和有经验的债务合作伙伴需要努力来提升你的业务,而不是把它拖入黑暗。 JT Schuweiler是福克斯罗斯柴尔德的律师,在那里他为客户提供复杂的金融交易建议。他经常与早期公司合作,尤其是在大麻行业。