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Romspen Provides $40MM in Debt Financing to Canadian Cannabis Group

August 25, 2017, 07:10 AM
Filed Under: Specialty Industries

Cronos Group Inc. announced that it has entered into a commitment letter for $40 million in debt financing with Romspen Investment Corporation to fund the continued construction of its 315,000 sq. ft. expansion, the “New Peace Facility."

Under the commitment letter, Romspen has agreed to provide the $40 million senior secured facility to the company’s wholly-owned licensed producer, Peace Naturals Project Inc. The Loan is secured by a first mortgage on the real estate of each of Peace and In The Zone Inc. ITZ, Hortican Inc. and the Company are also guarantors of the Loan. Under the loan, the company retains its ability to enter into equipment financing arrangements.

The Loan will be made available in multiple advances which are expected to begin in September 2017. Advances will be subject to ongoing conditions, including Romspen’s approval of construction progress. The Loan bears interest at a rate of 12% per annum (interest only accrues on advances made), has a 2 year term with a one-year extension option, and is prepayable on one-month’s notice.

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