Financially struggling marijuana technology company MassRoots received a $50,000 loan as part of the U.S. government’s Paycheck Protection Program, securing a cash infusion after earlier indications the money wouldn’t be available to cannabis companies.
Denver-based MassRoots, which offers an internet-based forum for cannabis consumers to connect and discuss various marijuana-related topics, secured the loan from Bank of America on May 3, Law360 reported.
The publication noted that MassRoots told the Securities and Exchange Commission last year that it had a little more than $2,600 in cash on hand.
Isaac Dietrich, MassRoots’ CEO, pointed out to Law360 that his company is an ancillary cannabis business and doesn’t touch the plant.
He added that only 3% of the company’s funding in 2019 came from cannabis companies – the rest came from institutional investors – so his legal counsel felt “comfortable” applying for the loan.
Dietrich told Law360 he has used some of the loan to pay rent and five employees, and the remainder will be saved for payroll.
Legal experts have said certain ancillary cannabis businesses might qualify for relief, depending on whether they can certify on the application that they are not an “indirect marijuana business” and are not engaged in activity that violates federal, state or local law.
MassRoots was cited in an April lawsuit the U.S. Securities and Exchange Commission filed against an investor who allegedly made millions of dollars by engaging in an illegal stock manipulation.
MassRoots trades as MSRT on the over-the-counter markets.
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