Jushi Holdings Announces a Senior Secured Credit Facility worth US$100 million from SunStream Bancorp
Jushi Holdings Inc. (CSE: JUSH) (OTCQX: JUSHF), a vertically-integrated, multi-state cannabis company running high-end retail locations and owning premium brands, announced that it is entering into an agreement for getting US$100 million Senior Secured Credit Facility from SunStream Bancorp Inc., a company that is a joint venture between Sundial Growers Inc. (NASDAQ:SNDL) and the SAF Group.
Jushi intends to initially draw US$40.0 million from the Credit Facility to fund its recently acquired company Nature’s Remedy of Massachusetts, Inc., a premiere cultivator, manufacturer, and retailer of cannabis, and some of its affiliates.
It is planning to borrow further amounts from the Credit Facility later on, for expanding the established sectors of the company as well as its developing markets.
Jim Cacioppo, Chief Executive Officer, Chairman, and Founder of Jushi Holdings Inc. said that since the amount that the company would be getting from SunStream was a non-dilutive funding, it would strengthen the company’s balance sheet by providing sufficient funds and would also allow the company to pursue its national growth plans in full measure.
He explained that the improved financial flexibility resulting from the provision would allow the company to continue its expansion efforts in existing markets like Nevada, Illinois, Ohio and California.
It would also help it to develop other potential markets like New Jersey, Maryland, and other high-growth regions. According to him, the company’s main focus is on spotting strategic opportunities to increase its operations across the supply chain, in order to ensure the company’s growth in such a way that its shareholders would benefit in the long term.
Once the loan amount issued under the Credit Facility is drawn, it will bear an annual interest of 9.5%. The interest is payable on a quarterly basis and will mature in five years from the closing date.
Jushi can draw money under the provisions of the facility for a period of 18 months. After that, for two years, it will be paying off only the interest, after which partial amortization will start on a quarterly basis when incremental payments of interest and principal will start.
Jushi also retains the right to increase the money it can draw from the Credit Facility to an amount of up to $25 million, subject to the conditions laid down in the agreement.
The Credit Facility is secured by a first lien over some of the assets of the company, and after that the lender will have his right on the collateral pledged as security on a pari passu basis along with other creditors, if any.