Medical Marijuana Inc (MJNA)

[Det_Robert_Thorne]

Don't know if folks here saw this in CannaVest's 10-K, but the reason that HempMedsPX/MJNA's CBD supplier said it's 1Q - 3Q filings couldn't be counted-on was probably because it's now saying that the audited cost of the Phytosphere deal was $8,020,000 (page F-12).

The 10-K also doesn't even mention the $4.50 - $6.00 collar they put on the shares anymore.

Once the $950,000 in cash they paid is subtracted, they value the 5,825,000 shares given to MJNA and HDDC at $7,070,000, which works out to $1.21/share (though they don't mention this number). And that's probably what the deal was actually worth. Note to, that CannaVest recently offered 10M shares at $1 and is supposed to soon offer another 10M at $1.50.

I've been writing for most of the past year that the $35M price and the quarterly installments were designed to pump-up the income numbers for MJNA, and the drastic revision to the cost of the deal seems to indicate that the original $35M price was dramatically overstated.

What's really surprising to me is that CannaVest no longer mentions the $35M value of the deal in the 10-K, though that value was mentioned in the 10-Qs for Q1 - Q3 of 2013.

This change is probably why CannaVest is having to revise their 10-Qs for 2013, but unfortunately for them, the announcement has attracted the attention of the Rosen Law Firm, which issued a PR on Friday evening announcing an investigation into CannaVest:

http://ih.advfn.com/p.php?pid=nmona&article=61825205

If they were trying to do a favor to Medical Marijuana, Inc by structuring the deal the way they did, it appears the old proverb, No good deed goes unpunished may apply here.