SLO County upstarts grab a slice of cannabis kingpin’s empire

August 10, 2022

By KAREN VELIE

When San Luis Obispo picked the people who would operate three marijuana retail shops in the city, they selected Helios Dayspring and his Natural Healing Center. They also got a group of people who were behind Megan’s Organic Market and another group who applied under SLOCal Roots.

The Megan’s Organic and SLOCal Roots applicants said on their forms that they were independent and using their own money to start their businesses. Things moved forward and Dayspring continued as San Luis Obispo’s marijuana mogul.

Then in 2020, Dayspring was charged with bribing public officials and falsifying his tax returns.

Initially, the city didn’t mind. Those crimes were not tied to selling marijuana. He transferred control of Natural Healing Center into the hands of his girlfriend, and the city initially found that acceptable.

But after that, the city took away his license saying that he lied on his application. City administrators explained that Dayspring lied about breaking the law and cheating on his taxes.

Dayspring says that’s not fair because the people from Megan’s Organic and SLOCal Roots also lied on their applications, according to a Dayspring declaration and interviews with a former employee.

They said their were funding their shops independently and on their own. That was a lie, Dayspring says and he should know because he loaned them hundreds of thousands of dollars to get started. The loans were supposed to turn into an ownership stake in each shop, maintaining Dayspring’s control of marijuana in San Luis Obispo.

Dayspring was San Luis Obispo’s marijuana mogul. For years, those wanting a piece of the retail cannabis industry pie in SLO County were told to kiss Dayspring’s ring, or have no chance of success. Dayspring reportedly owned a piece of every retail cannabis shop in the county, according to documents, several of his top employees and a Grover Beach cannabis business owner.

Dayspring had forged a close relationship with former Mayor Heidi Harmon. He hired her friend and co-founder of the SLO County Progressives, Nick Andre, to help run his cannabis operation.

In 2020, when the city initially picked three applicants to run retail marijuana shops in San Luis Obispo, Dayspring was well-positioned. He owned Natural Healing Center and had ties to Megan’s Organic Market. He was not connected with Elemental Wellness. The three had come out on top in a points rating system that the city used.

Shortly after the top three were announced, several city staffers, who asked not to be named to protect their jobs, said city officials wanted staff to change the scores to knock Elemental Wellness out. The employees refused.

The city asked a SLO police detective to interview the applicants. During the April 2020 interviews, police detective Suzie Walsh asked odd questions such as, “Have you ever been cruel to animals? Have you ever been involved in a lawsuit? Have you ever had a building code violation?” Even though Walsh does not have a business background, she inspected a number of corporate and business documents.

Walsh also voiced concerns that minority partners with Elemental Wellness had limited or no involvement in the preparation of the city application, a common practice in business. However, she did not require the same level of involvement with minority partners of Natural Healing Center, one of Dayspring’s partners said.

Based on Walsh’s report, then chief Deanna Cantrell asked city management to disqualify Elemental Wellness, giving SLOCal Roots the third permit.

Dayspring found locations for each retailer working with property owners Levi Seligman and Keith Sweeney. Seligman and Sweeney would eventually have a stake in Megan’s Organic.

Dayspring came up with an $800,000 convertible promissory note to fund Megan’s Organic Market and signed an agreement to have his employees manage the marijuana retail store, according to the documents. A partner in one of Dayspring’s shops said he was supposed to manage Megan’s Organic after it opened, but he had a falling out with Dayspring. CalCoastNews is not using the former partner’s name to protect him from retaliation.

Andre was one of Dayspring’s employees and there is a dispute whether Dayspring gave him a part of the $800,000 loan, but the convertible promissory note names him and an interest in Megan’s Organic.

“The membership interest to be issued upon conversion shall consist of 47 percent membership interest in the company issued to Helios Dayspring and 3 percent membership interest in the company issued to Nicholas Andre,” according to the convertible promissory note.

Dustin Tardiff, the attorney for Megan’s Organic, insists Dayspring did not give Andre a cut of the promissory note and says that Andre quit working for Dayspring before taking the job at Megan’s Organic.

Documents initially filed with the city showed ownership of Megan’s Organic split among six people. Megan Souza would have a 31.5 percent stake; Eric Powers another 31.5 percent, Melissa Seligman, 9.5 percent; Levi Seligman, 8 percent; Lindsey Law, 9.5 percent; and, Keith Sweeney 8 percent.

Dayspring’s convertible loan agreement shows the note could turn into a 46 percent ownership interest in Megan’s Organic for him and a reduction in several partners’ percentages.

Megan’s Organic opened in the summer of 2020.

On March 11, 2020, FBI agents raided Dayspring’s home on the outskirts of SLO. He pled guilty to bribing San Luis Obispo County Supervisor Adam Hill and falsifying his tax returns.

SLO city officials terminated Dayspring’s application for his Natural Healing Center SLO retail store on Oct. 19, 2021 after determining he had lied on his application.

MOM USA LLC, a company started by the newer investors, purchased the convertible note, and the owners of Megan’s Organic paid Dayspring back, Tardiff said. Tardiff then moved partial ownership of Megan’s Organic to a group of people tied to himself and Andre.

Tardiff asked the city in 2021 to transfer ownership in Megan’s Organic from Melissa Seligman, Levi Seligman, Lindsey Law and Keith Sweeney to Alison Borges, Tarrah Graves, Jillian Cardona and Phoebe Lapari, according to the email from the city to Tardiff.

Borges, the then-girlfriend and now wife of Andre, is an elementary school teacher. She has not returned questions about how she secured ownership in a multi-million dollar retail cannabis store.

Tardiff said Andre did not transfer the ownership interest to his girlfriend. She “purchased the shares.”

Graves is Tardiff’s wife, according to a 2015 grant deed. Tardiff said his wife also purchased shares.

Jillian Cardona is related to Mark Cardona, general counsel for MOM USA LLC.

ODLAS Investments LLC, which is owned by Tyler and Marian Saldo, now owns 8% of Megan’s. Saldo is Tardiff’s law partner

Dayspring accuses the city of canceling his permit for dishonesty while looking the other way when Megan’s Organic provided false information, in a declaration in support of a lawsuit filed against the city. In its application, Megan’s Organic claimed all its financial capital originated from its ownership team.

“All of our financial capital comes directly from our ownership team which we believe sets us apart from other applicants who may be dependent on out-of-area funding,” according to the application.

According to SLO City Attorney Christine Dietrick, having funding from other sources would not disqualify Megan’s Organic and that there is no evidence they were dishonest under penalty of perjury.

“Based on information provided by the permit holders under penalty of perjury, we have not concluded that the applicants failed to disclose information that was required by the application at that time,” Dietrick said.