Jushi Holdings Inc (CSE:JUSH, OTCQX:JUSHF) has announced the second closing of its previously announced private offering of 12% second lien notes and detached warrants to purchase the company’s subordinate voting shares at an exercise price of US$2.086.
To date, Jushi has closed on an additional US$3 million for a total of US$72 million in gross cash proceeds, and issued US$72 million aggregate principal amount of notes and approximately 17 million of warrants to investors in the notes.
The notes will mature on December 7, 2026, will bear interest of 12.0% per annum, payable in cash quarterly, and will be guaranteed by certain of the company’s direct and indirect domestic subsidiaries and secured by second priority liens on certain assets of the company and certain of the company’s direct and indirect domestic subsidiaries.
READ: Jushi Holdings raises US$69M in private offering; releases new poll on cannabis consumer habits
In connection with the offering, the purchasers of the notes also received four-year warrants at 50% coverage with an expiry date of December 7, 2026, at an exercise price per share equal to US$2.086.
The offering and sale of the notes and warrants have not been and will not be registered under the Securities Act of 1933, as amended, or the laws of any other jurisdiction, and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements.
Entities affiliated with Jim Cacioppo, Jushi’s chief executive officer, chairman and founder, subscribed for US$3.0 million of the notes, and Denis Arsenault, a significant stockholder of the company, subscribed for US$14.4 million of the notes.
Additional Financing Secured
Jushi also said it has entered into an equipment lease financing facility with XS Financial, together with a related equipment funding commitment of up to US$10 million valid through August 2, 2023, subject to the terms and conditions of such facility agreement.
Within that commitment and pursuant to such facility agreement, the company expects to conduct approximately US$2.0 million in sale-leasebacks of certain company-owned equipment, subject to customary closing conditions.
Further, the company also plans to draw down an additional US$1.9 million on an Arlington, Virginia real estate mortgage facility in the first quarter of 2023.
Jushi Holdings is a vertically integrated cannabis company led by an industry-leading management team. In the United States, Jushi is focused on building a multi-state portfolio of branded cannabis assets through opportunistic acquisitions, distressed workouts, and competitive applications. Jushi strives to maximize shareholder value while delivering high-quality products across all levels of the cannabis ecosystem.
Contact the author at jon.hopkins@proactiveinvestors.com