Zinger Key Points
- Complications arose as the company prepared for a scheduled payment to shareholders on October 5, 2024.
- The acquisition involved a structured payment plan with 4 scheduled payments. The outcome of this case could have far-reaching implications.
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Safe Harbor Financial SHFS, focused on cannabis banking solutions, is embroiled in a legal battle over its $30 million acquisition of Rockview Digital Solutions (Abaca), initially agreed upon in October 2022. Complications arose as the company prepared for a scheduled payment to shareholders on October 5, 2024.
The acquisition involved a structured payment plan with four scheduled payments: the first on November 14, 2022, followed by payments on October 5, 2023, 2024, and 2025. As the 2024 payment date approached, Safe Harbor struggled to obtain necessary details from the shareholders' representative, escalating into a legal dispute.
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Legal Battle Over Acquisition
The dispute began when Daniel Roda, who oversaw the payments, cited a conflict of interest and designated James R. Carroll as his successor. Carroll then appointed Gregory Ellis as an agent to receive a $3 million payment, which he controversially requested be sent to his account.
This raised significant concerns for SHF, prompting a lawsuit aimed at asserting that Roda lacked the authority for these changes.
Debra Borchardt reported that the outcome of this case could have far-reaching implications for Safe Harbor’s reputation and financial standing as it navigates the complexities of the cannabis banking sector.
The legal troubles could put Safe Harbor’s plans on hold and complicate its relationships with potential partners. How this situation plays out could influence future deals in the cannabis banking sector, making it essential for Safe Harbor to resolve the dispute quickly.
Price Action: SHFS was trading at $0.5185, up 8.73% or $0.04, at the time of writing, Wednesday morning.
Read Next: Marijuana Banking Innovator Exits $3.1M Loan, Collects Over $200K In Accrued Interest
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