4Front to use strengthened balance sheet to expand and develop its production capacity
PHOENIX, May 10, 2019 — 4Front Holdings, LLC (“4Front”), a diversified operator of strategically aligned cannabis-related businesses, including cultivation, production and retail operations, is pleased to announce it has secured a $50 million loan (the “Loan”) from LI Lending, LLC (“LI Lending”) to support the expansion and buildout of 4Front’s cultivation and production facilities ahead of its anticipated business combination with Cannex Capital Holdings, Inc. (“Cannex”) (CSE: CNNX)(OTCQX: CNXXF).
The Loan’s terms include:
- A five-year term
- An interest rate of 10.25%
- A 20% repayment premium at maturity
Importantly, the Loan is non-dilutive, not convertible, does not include warrants or similar equity instruments nor a prepayment penalty.
“We have had detailed discussions with several prospective lenders over the last two years, but LI Lending offered terms materially better than others,” said Josh Rosen, CEO and co-founder of 4Front. “In addition, our lender has a ground-up understanding of cannabis production and processing facilities.”
4Front’s anticipated business combination with Cannex has been approved by Cannex shareholders and is awaiting final approval from U.S. antitrust authorities. The resulting combined entity is planned to be named 4Front Ventures.
4Front is building a next-generation company in the cannabis industry, based upon strategic and aligned leadership, battle-tested operating capabilities, transparent and principled governance, and a commitment to developing and supporting people and communities. Led by a group of professionals with experience in strategy, manufacturing, distribution & logistics, finance, real estate, multi-location retail & hospitality operations and talent development & retention, 4Front has invested heavily to assemble a comprehensive collection of management skills and hands-on operating expertise that can support the rapid operational growth opportunity being afforded by the increased legalization of cannabis across the globe. For more information, visit 4Front’s website.