The CSE is cleaning house with cannabis companies and it hit both Wayland Group (WAYL) and MJardin (MJAR) with suspensions this week for defaults of exchange requirements.
CSE suspensions are imposed because of regulatory concerns, or failure of the issuer to pay applicable fees. It will suspend a firm if it fails to meet any of its policy requirements or if it feels it is in the public interest to do so.
Wayland failed to file audited financial statements and a management discussion and analysis, so it was hit with a failure-to-file cease trade order.
A company can only resume trading when it cures the default that sparked the suspension or paid a reinstatement fee. It risks a delisting if it cannot turn the situation around.
MJardin and Wayland were both suspended on Tuesday and MJardin resumed trading by 10:30 a.m. on Wednesday. Its price stood at C$2.06 before it was suspended, and it reopened at C$1.85, before decreasing to C$1.48 when trading closed on Thursday, May 9. It is down from C$5.25 on Dec. 31, 2018.
The firm swung from a net income of C$1.5 million in 2017 to a loss of C$84.3 million last year. Founder Rishi Gautam has resigned from its board of directors effective immediately, as have chief strategy officer Francis Knuettel II and chief operating officer Jorge Boone.
Wayland is still yet to resume trading. It is also significantly underperforming the cannabis sector this year and its price has gone from C$4.11 on Jan. 26 to just C$0.74 on Monday before trading was suspended.
It was also suspended on the Frankfurt Stock Exchange, but it has been trading over the counter under the ticker MRRCF, where it was down to $0.57 when the markets closed on Thursday.
Despite its current situation, Wayland believes that its suspension will “not materially affect” the company’s sale of a 49.9% stake in its international arm to International Cannabis Corp. It was already expecting a cease trade order after admitting the company and its auditors, MNP LLP, needed more time to its 2018 financial statements.
It has pledged to make the required filings within 90 days of the order and it will then resume trading.
The embattled firm was dealt another blow after learning that it has suffered a setback in its bid to begin cultivating medicinal marijuana in Germany. Wayland agreed to sell 49.9% of its international business to ICC for US$126 million in stock earlier this year. The two firms agreed to launch an international subsidiary, jointly owned by both companies. Shares in both firms decreased after the news from Germany.