Arizona-based Harvest Health & Recreation has closed the first tranche of its previously announced brokered private placement of 7% unsecured convertible debentures.
The placement has been secured at at a price of US$1,000 per convertible debenture (the ‘Issue Price’) for gross proceeds of US$100m.
Eight Capital is acting as agent for the offering. Harvest Health intends to use the net proceeds of the offering to fund working capital and general corporate purposes.
Harvest Health has also entered into an investment agreement with an institutional investor and an Agency Agreement with Eight Capital, pursuant to which Eight Capital has agreed to offer for sale, and the institutional investor has agreed, subject to certain terms and conditions customary for a transaction of this nature, to purchase up to four additional tranches of 100,000 convertible debentures at the Issue Price, for additional gross proceeds of up to US$400m, in line with previously announced terms.
Harvest Health, a multi-state cannabis operator (MSO), says that – subject to closing of announced acquisitions – it owns the rights to 219 facilities, of which 142 are retail locations. It has more than 1,580 employees across 17 states.
The Convertible Debentures have a maturity date of May 9, 2022 and bear interest from the date of issue at 7.0% per annum, payable semi-annually on June 30 and December 30 of each year.
“Our vision is to become the most valuable cannabis company in the world and this transaction will help fuel Harvest’s growth.”
“Our vision is to become the most valuable cannabis company in the world and this transaction will help fuel Harvest’s growth,” said Harvest CEO Steve White.
“This is a particularly acquisitive time in the industry and access to significant capital with favorable terms is crucial to long-term success.”Cannabis Business Worldwide