Newstrike Resources Ltd. (TSX VENTURE:HIP) just announced that its wholly-owned ACMPR licensed producer subsidiary, Up Cannabis Inc. has agreed to acquire a greenhouse facility in Ontario.
About the Facility
Approximately 200,000 square foot, with 160,000 of that space dedicated to production
Situated on 16.6 acres of land
Potential to add an additional 140,000 sq. feet of production space
Company estimates that this facility when online could increase production capacity to nearly 15,000 kg/year
UP plans to develop and apply for licensing of this facility under the ACMPR in addition to its existing licensed facility
Terms of Deal & Related Financing
The purchase price of ~$7.3 million CAD will be financed in part through a $4.0 secured acquisition facility. The balance of the purchase price will be funded from the company's existing capital.
This secured acquisition facility has been committed to the Company by a syndicate of Newstrike officers, directors and shareholders led by Beechhill Capital Corp.
The loan is for a term of just under seven months, expiring on February 15, 2018 and includes simple interest at the rate of 15% per year (1.25% per month) with monthly interest-only payments during the term and repayment in-full at the end of term.
The loan can be repaid early with the addition of a cancellation fee of 1.0% of all amounts outstanding at the time of cancellation.
The loan is secured by a general charge over the assets, inventory and undertakings of UP Cannabis Inc. and upon completion of pending first-mortgage financing for the Facility, a subordinated charge on the 16.6 acres of land included in the Acquisition.
The Company expects to complete the acquisition and all related financings by July 31, 2017.
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