Full Circle Provides $30MM Facility to Advanced Cannabis Solutions
Advanced Cannabis Solutions announced it signed a definitive agreement Jan 21, 2014 with Full Circle Capital, a closed-end investment company, to provide that the investment fund will initially provide $7.5 million to the company in the form of senior-secured convertible notes, subject to certain conditions. An additional $22.5 million can be borrowed by company with the mutual agreement of the company and the investment company.
At least 95% of the loan proceeds will be used to acquire properties, which the company, consistent with its business plan, will lease to licensed cannabis growers.
The six-year loan will be secured by real estate acquired with the loan proceeds, and will require interest-only payments at a rate of 12% per year.
The initial loan can, at any time, be converted into shares of the company’s common stock at a conversion price of $5.00 per share. It is contemplated that further advances will be convertible at 110% of the share price on the day of advance, or the ten-day, volume-weighted average price leading up to the day of advance, whichever is lower. In addition, the investment fund will receive 1 million three-year warrants to purchase common shares at $5.50 per share.
The funding of the loan financing is subject to the execution of additional documents between the parties.
Robert Frichtel, president, commented, “We greatly appreciate this vote of confidence in the CANN business model and management team as we work to grow our Company.”
Advanced Cannabis Solutions provides a comprehensive set of solutions to the regulated cannabis industry. The company does not grow, harvest, distribute or sell cannabis or any substances that violate U.S. law or the Controlled Substances Act, nor does it intend to do so in the future.