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GenCanna hemp production agreement party’s sale objections overruled
By Caroline Salls
Pittsburgh, May 12 – GenCanna Global USA, Inc. industrial hemp production agreement party Bragg Farms & Co.’s objections to approval of GenCanna’s asset sale were overruled Tuesday by the U.S. Bankruptcy Court for the Eastern District of Kentucky.
Judge Gregory R. Schaaf said in his order that it was necessary to reach a conclusion on the extent of Bragg’s lien on hemp grown on its farm in Alabama and transferred to GenCanna to allow a decision on the company’s motion to sell substantially all of its assets.
“It does not matter whether the debtor or Bragg had title to the hemp,” Schaaf said. “Bragg does not have a valid or perfected lien against the hemp grown on its farm that was delivered to the debtor.”
As previously reported, Bragg also filed a lawsuit against GenCanna and lender agent MGG Investment Group LP, alleging that the company owes it $1.95 million in installment payment.
According to the complaint, GenCanna asked Bragg in December to restructure payments owed under the contract to help its cash flow in exchange for payment of an additional per-acre-planted bonus.
As a result, Bragg said it elected to defer its second installment due in January and received payment of $615,000, representing one-quarter of the amount owed for its production and payment of $205,000 representing a per-acre harvest payment in December.
Bragg alleged in the lawsuit that GenCanna did not make installment payments due in February, March and April or a $102,500 bonus payment.
Winchester, Ky.-based GenCanna is a vertically integrated agriculture-technology company specializing in the production of hemp rich in CBD. The company filed bankruptcy on Feb. 6 under Chapter 11 case number 20-50133.
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