ROLLING MEADOWS, Ill. – As of April 1, one company Ben Kovler controls is paying another company Ben Kovler controls $70 million a year. But that arrangement is only the latest turn in a longer chain of loans, asset transfers, leadership changes, and brand reshuffling linking Green Thumb Industries and RYTHM.
Kovler serves as chairman and chief executive officer of both companies.
- The $70M pivot: Green Thumb Industries (GTI) has amended its licensing deal with RYTHM, replacing variable, sales-based royalties with a fixed annual payment of $70 million.
- The “loop” structure: The deal is a “related-party” transaction; Ben Kovler serves as chairman and CEO of both the payer (GTI) and the payee (RYTHM).
- Brand portfolio: The agreement covers the intellectual property for several major GTI brands, including RYTHM, incredibles, Beboe, Dogwalkers, and &Shine.
- Strategic consolidation: The fixed-payment model represents the technical culmination of the former Agrify’s transition into RYTHM Inc., a Nasdaq-listed entity centered on cannabis IP.
- Market reaction: Following the April 1 announcement, RYTHM’s stock (RYM) saw a significant midday surge of 23%.
A royalty model becomes a fixed annual obligation
GTI and RYTHM amended their existing trademark and recipe license agreements effective April 1, substituting a fixed annual cash fee for the previous sales-based royalty arrangement. Under the amended deal, GTI will pay RYTHM $70 million a year, in monthly installments, for use of the RYTHM, incredibles, Beboe, Dogwalkers, Doctor Solomon’s, &Shine, and Good Green brands. Payments are subject to an annual increase equal to twice a Consumer Price Index-based escalator.
The agreement is between RYTHM’s wholly owned subsidiary GTI Core LLC and GTI’s wholly owned subsidiaries VCP IP Holdings LLC and MC Brands LLC.
The path to the transaction was somewhat convoluted.
How Agrify became RYTHM
Previously a publicly traded agricultural equipment company known as Agrify Corporation, the company now known as RYTHM exited that sector in December 2024 when it sold its cultivation-related businesses to CP Acquisitions LLC for $7 million and the assumption of Agrify’s liabilities. According to Securities and Exchange Commission filings, CP Acquisitions is owned and managed by Agrify founder and former chief executive officer Raymond Chang, who resigned from Agrify in November 2024 in conjunction with a $20-million financing arrangement offered by GTI. The GTI loan followed Agrify’s reported net loss of $41.75 million, year-over-year revenue decline of 36.1 percent (to $9.68 million), and a dramatic 90-percent drop in share price.
Concurrently, Kovler was named chairman and interim CEO of Agrify.
Why the overlap matters
At the time it sold its cultivation businesses, Agrify stated it intended to enter the federally legal hemp-derived-THC beverages space, allowing the company to maintain its Nasdaq listing. RYTHM Beverages launched in July 2025 as a hemp-derived division of RYTHM, a cannabis brand founded by Kovler in 2014. The next month, Agrify paid GTI $50 million for a portfolio of cannabis-brand intellectual property, including RYTHM and the other above-mentioned licensed brands.
At the same time, GTI extended an additional $45-million loan to Agrify and entered an agreement to license the brands back for manufacturing, sales, and distribution.
Following the GTI brands acquisition, Agrify rebranded to RYTHM Inc., which now trades on the Nasdaq as RYM with cannabis intellectual property at its core.
Why the related-party structure matters
RYTHM carried a market capitalization of approximately $50 million at its April 1 opening price of $24.10. The stock surged 23 percent on news of the amended licensing deal, arriving at a market cap of $57 million by noon EDT.
As of March 10, GTI controlled 49.99 percent of RYTHM, including 35 percent of RYTHM’s outstanding common shares along with secured convertible notes and warrants.
