North American Cannabis Holdings, Inc (OTCMKTS:USMJ) Wipes Big Green Session in Full
After an attention-grabbing 30% spike in an all-time record volume session, North American Cannabis Holdings, Inc (OTCMKTS:USMJ) wiped this green push in full, then slipped a notch lower by the closing bell. Yesterday the company traded in heavy volume again, at 13.3 million shares changing hands, and dropped 24% to stop at $0.0134.
We covered USMJ (formerly known as Algae International Group Inc, ticker symbol ALGA) yesterday, in the wake of the company’s price pop on the announcement of its new subsidiary – AmeriCana Cafe, which will aim to open a chain of cannabis-infused beverage shops. The company may be in for a bit of a hard time opening the locations considering its last reported financial situation. Here is what USMJ had to show on its books as of March 2015:
- ZERO in cash
- $66,500 in total current assets
- $4.4 million in current liabilities
- ZERO in revenues
- $357 thousand in quarterly net loss
The company has not generated a dime of revenue over the last three fiscal years and is in what should be the final steps of transitioning into a marijuana-based business model. Interesting facts about USMJ include the reverse 1-for-20,000 split the company executed in early 2015, reducing its outstanding shares significantly, as well as the fact that 1.2 BILLION of the pre-split shares were issued at prices between $0.00005 and $0.00007 (those are indeed four zeroes after the decimal).
Yesterday USMJ put up a new announcement. The company did not use the regular newswire approach it went for with the AmeriCana Cafe news. Instead, the new release is only available through the OTC Markets news and disclosure service. USMJ announced a “legal petition” was filed in court and as a result 6.18 million USMJ common shares were placed under a permanent injunction, restricting their transfer. The company took action as the shares were allegedly issued “in violation of a contractual agreement”. USMJ seeks to have the shares cancelled.
The 6.18 million represent roughly 10% of what the company had as outstanding shares as of May 8, 2015 according to a Schedule 13G stamped with that date. This is no small reduction, if the cancellation does go through. However, it’s made somewhat less impressive considering USMJ diluted its stock from 48 million common shares to 66 million between Mach and May.
