Greenlane Holdings, Inc. (NASDAQ:GNLN), a distributor of durable goods, has announced a change in its independent registered public accounting firm. On November 20, 2024, the Audit Committee of the Board of Directors of Greenlane Holdings dismissed Marcum LLP as the company's independent auditor.
This decision was effective immediately upon the announcement. Marcum's reports on Greenlane's financial statements for the years ending December 31, 2023, and December 31, 2022, did not contain any adverse opinions or disclaimers. However, they did include explanatory paragraphs highlighting the uncertainty about Greenlane's ability to continue as a going concern and the restatement of previously issued financial statements to correct misstatements.
Following Marcum's dismissal, Greenlane appointed PKF O’Connor Davies as their new independent registered public accounting firm for the fiscal year ending December 31, 2024. Prior to this engagement, Greenlane had not consulted with PKF on any accounting principles or transactions, nor were there any disagreements or reportable events with PKF.
The company has provided Marcum with the disclosures made in this report and has filed Marcum's letter to the SEC dated November 25, 2024, as Exhibit 16.1 with this Current Report on Form 8-K. This change comes as Greenlane continues to address its financial reporting and internal control challenges. The information in this article is based on a press release statement from Greenlane Holdings, Inc.
In other recent news, Greenlane Holdings has announced several significant developments. The company has entered into a multi-year distribution partnership with Veriteque USA, Inc., and Safety Strips Tech Corp. to distribute their various field test kits across the U.S. Greenlane has also signed a non-binding letter of intent to distribute CURB Lifestyle's patented inhalation device across various markets.
In a strategic move to improve its financial position, Greenlane has restructured its debt, reducing it by approximately $617,000 and extending its maturity. The company has also issued a $3.2 million convertible note to Cobra Alternative Strategies, providing immediate capital with potential for equity conversion. To further bolster its finances, Greenlane has successfully reduced its U.S. vendor accounts payable by nearly $4.4 million.
Greenlane plans to raise $6.5 million for working capital and general corporate purposes by issuing over 2.3 million units, with Aegis Capital Corp. serving as the exclusive placement agent. In a show of confidence in the company's future, CEO Barbara Sher recently purchased 12,500 common shares. Finally, to meet Nasdaq's minimum bid price requirement, Greenlane has announced a one-for-11 reverse stock split of its Class A common stock.
InvestingPro Insights
The recent change in Greenlane Holdings' independent auditor comes amid significant financial challenges for the company. According to InvestingPro data, Greenlane's market capitalization stands at a mere $2.38 million, reflecting the company's struggle to maintain investor confidence. The company's revenue for the last twelve months as of Q3 2024 was $21.61 million, with a staggering revenue decline of 72.06% over the same period.
InvestingPro Tips highlight that Greenlane "operates with a significant debt burden" and "may have trouble making interest payments on debt." These tips align with the auditor's concerns about the company's ability to continue as a going concern. Additionally, the tip noting that Greenlane is "quickly burning through cash" further underscores the financial instability mentioned in the article.
For investors seeking a more comprehensive analysis, InvestingPro offers 11 additional tips that could provide deeper insights into Greenlane's financial situation and market performance.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.