Cronos Group Enters Into $100m Credit Facility to Build Custom Greenhouse

TORONTO, Aug. 23, 2019 (GLOBE NEWSWIRE) — Cronos Group Inc. (NASDAQ: CRON) (TSX: CRON) ("Cronos Group" or the "Company") has entered into a credit agreement (the "Credit Agreement"), as administrative agent and lender, with Cronos Growing Company Inc. ("Cronos GrowCo" or "GrowCo"), as borrower, in respect of a $100 million secured non-revolving term loan credit facility (the "Credit Facility").

Cronos GrowCo, a 50/50 joint venture owned by Cronos Group and a group of investors led by Bert Mucci (the "Greenhouse Partners"), intends to use the funds available under the Credit Facility to fund the construction of the previously announced custom-built greenhouse (the "Facility") and for general operating purposes. Completion of construction of the Facility is subject to obtaining the relevant building and occupancy permits and other customary approvals. Commencement of operations at Cronos GrowCo will be subject to obtaining the appropriate licenses under applicable law.

The Credit Facility will mature on March 31, 2031 and will bear interest at varying rates based on the Canadian prime rate. Interest will begin to accrue as of the closing date and will be payable on a quarterly basis until maturity, except that any interest accrued prior to March 31, 2021 will be payable not later than December 31, 2021. The Credit Facility is secured by substantially all present and after acquired property of GrowCo and its subsidiaries. The Greenhouse Partners have also provided a limited recourse guarantee in favour of the Company, secured by the Greenhouse Partners' shares in GrowCo.

The Credit Agreement contains customary representations and warranties and operating covenants. Advances under the Credit Facility are subject to customary conditions.

"We regularly evaluate our supply chain opportunities, including those within our asset footprint to ensure we are driving the greatest returns and best positioning Cronos Group for long-term success. As part of this work, we have decided to provide the debt funding for the GrowCo joint venture," said Jerry Barbato, CFO of Cronos Group.

"The management team at GrowCo have been great partners, and we value the expertise they continue to bring to this project."

– Jerry Barbato, CFO of Cronos Group.

Disclaimer: Past performance is not an indicator of future performance.

About Cronos Group

Cronos Group is an innovative global cannabinoid company with international production and distribution across five continents. Cronos Group is committed to building disruptive intellectual property by advancing cannabis research, technology and product development. With a passion to responsibly elevate the consumer experience, Cronos Group is building an iconic brand portfolio. Cronos Group's portfolio includes PEACE NATURALS™, a global health and wellness platform, and two adult-use brands COVE™ and Spinach™.

Get the Latest Marijuana News &
Content in your Inbox!

All your support helps The Green Fund keep writing content for all you
marijuana enthusiasts and potential pot stock investors

Louis O'Neill
Louis O'Neill

Louis is a writer based in Sydney with a focus on social and political issues. Having interviewed local politicians and entrepreneurs, Louis now focuses on cannabis culture, legislation & reform.

Leave a Reply

Your email address will not be published. Required fields are marked *