🌿 Illicit Brand becomes employee-owned, lawmakers push to postpone hemp ban, and Sunderstorm expands house of brands

Happy Friday Pre Rollers! Welcome to another edition of The Pre Roll, the cannabis newsletter that keeps you up-to-date on the industry happenings you need to know.

Here’s what we’re rolling up this week:

…and more. Let’s get to it.

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Taking ownership. S1 Enterprises, the parent of the Illicit cannabis brand, just closed on the largest Employee Stock Ownership Plan (ESOP) deal in the U.S. cannabis industry to date.

The transaction transitions ownership of its Missouri and New Jersey operations to an ESOP covering over 500 employees. The move also strategically combats the federal tax burden under Internal Revenue Code Section 280E by leveraging ESOP‑related tax advantages to boost cash flow for growth and innovation.

The initiative was advised by Sharp Capital Advisors and Verit Advisors with legal guidance from Polsinelli.

Put off. Congressman Jim Baird (R-IN) introduced this week the Hemp Planting Predictability Act. The bill would delay implementation of restrictive hemp provisions for two years by amending the FY2026 Agriculture, Rural Development, Food and Drug Administration, and Related Agency Appropriations Act, which redefined legal hemp and is widely viewed as a threat to the hemp‑derived products sector.

The legislation includes four cosponsors: House Oversight and Accountability Chair James Comer (R-KY), House Agriculture Committee Ranking Member Angie Craig (D-MN), Congressman Tim Moore (R-NC), and Congressman Gabe Evans (R-CO).

Expanded footprint. Sunderstorm, the Los Angeles–based cannabis company behind the KANHA edibles brand, has acquired California brand Lime, marking its entry into the fast-growing pre-roll segment. The acquisition expands Sunderstorm’s house of brands portfolio into a third category beyond edibles and vapes, allowing the company to leverage Lime’s established retail presence while benefiting from its own production and distribution infrastructure.

Lime will continue to operate under its own brand name. Financial terms of the deal were not disclosed.

Delaware: A proposed new law aims to decriminalize smoking cannabis in public.

Kentucky: A lawmaker introduced a bill to let voters decide whether to legalize recreational cannabis for adults 21 and older.

Massachusetts: The state’s cannabis industry set a new annual sales record in 2025 with more than $1.65 billion in licensed sales.

Ohio: Recreational cannabis sales surpassed $836 million in 2025, which was the first full year of the state’s newly launched adult‑use cannabis market.

Oregon: The cannabis market saw overall sales fall 3.5% to $925 million because of lower price as a result of increased production.

Texas: Regulators have recommended new rules dramatically increasing licensing and registration fees for hemp‑derived THC retailers and manufacturers by more than 13,000 %.

Common Citizen chooses new CEO

The Michigan-based cannabis company hired Florida cannabis executive Robert Beasley, formerly CEO of Fluent/Cansortium, as its new CEO to lead a turnaround.

Fine Fettle flips to hybrid facilities

The multi-state operator converted all nine of its Connecticut dispensaries into hybrid locations that serve both registered medical patients and adult‑use customers.

KEY Investment Partners buys BellRock Brands

The cannabis private equity and venture capital firm acquired the Denver-based multi-state operator’s CPG-focused portfolio out of receivership.

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Stay tuned for more cannabis industry news next week!

💚,

The Pre Roll Team

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