4Front to convert 44% of debt into class A subordinate voting shares

By Mary Katherine Stinson

Lexington, Ky., Jan. 8 – 4Front Ventures Corp. will convert about $23 million, or about 44%, of the principal amount of its debt into the company’s class A subordinate voting shares, pending third-party concessions and approvals, including regulatory approval from the Canadian Securities Exchange, according to a news release.

The conversion price of C$0.125, or $0.094, per voting share was negotiated at the closing price on Dec. 22.

Under the amended loan and security agreement, the company will also provide 15% warrant coverage with an exercise price of C$0.144, or $ 0.108, each exercisable into one voting share, for a term of three years. This represents a premium of 15% from the issue price of the class A shares.

The terms for the remaining loan balance of $28.7 million are unchanged, and the interest rate will remain at 12%.

Phoenix-based 4Front is a vertically integrated, multi-state cannabis operator and retailer.

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