Jammin Java Corp which trades as Marley Coffee, in disclosures made in a letter to shareholders on July 7, says it has settled with the US-based Securities and Exchange Commission (SEC).

The settlement refers to charges related to allegations that the company conducted an illegal securities offering and participated in a “pump and dump” stock scheme – improprieties which were announced in November 2015.

Jammin is a US-based company, co-founded by Rohan Marley, son of Reggae great Bob Marley, that provides premium, artisan roasted coffee to the grocery, retail, online, service, hospitality, office coffee service and big box store industry.

Under its exclusive licensing agreement with Fifty-Six Hope Road Music Ltd, the company has developed its coffee lines under the ‘Marley Coffee’ brand.

The company has entered into a consent, which has been approved by the SEC, but not by the court, to settle the SEC’s complaint for US$700,000 and Rohan Marley has stepped down as chairman of the board of directors.

The company also disclosed that Fifty-Six Hope Road Music has terminated its licence with the company, and in its place agreed to a short-term six-month licence, with negotiations for a longer-term licence underway. The company said it has paid to 56 Hope Road US$297,324 in outstanding licensing fees.

The letter to shareholders which was released, indicates that on or around May 31, 2016, it entered into a ‘Consent of Defendant Jammin Java Corp.’, in connection with the complaint filed by the SEC on November 17, 2015.

“Pursuant to the Consent, without admitting or denying the allegations of the Complaint, we consented to the entry of a final judgment , which, among other things: (a) permanently restrains and enjoins us from violating Section 5 of the Securities Act of 1933; and (b) orders us to pay disgorgement and prejudgment interest totaling an aggregate of $700,000, due within 90 days of the entry of the Final Judgment, which has been approved by the SEC and is expected to be approved by the court on or around July 11, 2016,” it was stated.

Brent Toevs, Chief Executive Officer of Marley Coffee said that action taken was “a pivotal moment in the Company’s history and we are excited to put this chapter behind us and move forward at full speed with our growth and operations”.

He added, “I have always said that we will only run an ethical company. Since the beginning, we’ve cooperated with the SEC when issues first came to light in 2011 and we’re glad we’ve resolved all outstanding matters. As we’ve previously indicated, we will continue to cooperate with the SEC in order to help bring about justice.”

Noting that the lawsuit really challenged Jammin’s ability to raise capital, he said the agreement will alleviate “some of the concerns of our funding sources and our partners”.

Effective June 29, 2016, Rohan Marley, founder of Marley Coffee, resigned as chairman and from the board of directors of Jammin Java Corp. The company says that his resignation was not in connection with a disagreement with the Company.

“My objective these days is not to run the company as chairman of the board, but to focus on the day-to-day work of building the ‘Marley Coffee’ brand, being its global ambassador and returning to my roots in coffee farming,” Marley was quoted as saying.

On June 27, 2016, Fifty-Six Hope Road Music provided notice of the termination of the 15-year licensing agreement entered into with 56 Hope Road on September 13, 2012.

The letter indicated that notwithstanding the termination of the prior licence, 56 Hope Road – through its affiliate – has agreed to enter into various agreements including a six-month short-term licensing agreement signed on July 6, 2016, “which has substantially similar terms (other than the length of the licence) as the prior 15-year licence”.

Jammin stated that 56 Hope Road terminated the 15-year licence “due to our breach of certain of the terms of such licence agreement, including, but not limited to, our failure to deliver quarterly statements in a timely manner, our failure to timely make licensing payments, our failure to deliver audited financial statements in a timely manner, and the SEC’s complaint against us.”