Penny Hemp Stock Pharmagreen Biotech Files for Bankruptcy

Earlier this week, Pharmagreen Biotech (OTC: PHBI), a penny hemp stock specializing in premium tissue culture breeding for the cannabis and hemp industry just filed for bankruptcy protection under Chapter 11. The Nevada-based cannabis company breeds clones of cannabis such as plantlets or liners for sale to marijuana and hemp cultivators.

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In court, the company declared that its assets are less than $50,000, whereas its debt lies somewhere between $500,001 and $1 million.

Upon the bankruptcy court’s approval, the hemp stock would be able to continue its operations in the normal course as well as enter into dealings with vendors and suppliers. Pharmagreen also intends to use the Chapter 11 filing to design a comprehensive restructuring plan.

The hemp company wants to emerge intact from this situation and secure the necessary additional funding. Pharmagreen is also looking forward to its ETN asset-backed bond scheduled to commence trading on the European markets.

Delay due to COVID-19 and ‘Toxic Terms” with lenders

The ETN process was delayed due to the lockdown in Europe driven by the COVID-19 pandemic. Meanwhile, the company entered into financing deals with some lenders which allegedly had ‘toxic terms’ after 6 months. Peter Wojcik, the CEO of Pharmagreen stated, “These lenders are seeking very toxic conversions that would essentially wipe out the company’s valuation.”

Applied for LOAC registration to expand footprint in EU

In July Pharmagreen Biotech provided an update on scientific development. The hemp stock’s strategic research and development partner, Botanical Research In Motion Inc. (B.R.I.M.), has submitted its data for “CBD Dana” hemp strain registration to be included in the List of Approved Cultivars (LOAC) in the European Union.

The significance of this listing is that the LOAC registration status for “CBD Dana” will allow Pharmagreen to boost its sales of plantlets and its derived cannabinoid oils to the European Union. As the EU is the largest CBD market in the world, this is sure to expand the market for the hemp stock.

Bankruptcy protection crucial for funding future developments

Pharmagreen Biotech relies a lot on scientific research and development and naturally demands a lot of funding. It remains to be seen whether the cannabis company receives approval from the bankruptcy court or not. This is the last resort for Pharmagreen to protect the company and ensure the continuation of its future operations in the cannabis industry.

Penny Hemp Stock Pharmagreen Biotech Files for Bankruptcy

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Penny Hemp Stock Pharmagreen Biotech Files for Bankruptcy