Red White & Bloom Brands, Inc. (OTCQX: RWBYF) (CSE: RWB) is engaged as a multi-state cannabis company, which is focused on developing operations and investments in Arizona, California, Florida, Massachusetts and Michigan. Shares of the U.S.-focused cannabis company rallied 38% during trading on Monday, September 19, 2022. Over the past thirty days, Red White & Bloom has seen average daily volume of 133,402 shares. However, volume of 318,926 shares or dollar volume of around $33,519, exchanged hands during the day’s trading.
Shares of Red White & Bloom Brands are gaining after the company announced that it has restructured over CDN$110 million worth of debentures. The company was able to restructure terms of some of its loans in an aggregate of $70 million USD, which now have an amended maturity date in 2024. A separate CDN$2.1 million current loan was also amended to extend maturity out to 2024. The company also announced the issuance of a new CDN$17 million convertible loan, which maintains a conversion price at a 67% premium compared to its current price. In addition, the convertible loan will mature in 2024.
Here is a full breakdown of the loan restructurings:
- A secured debenture in the principal amount of USD $25,885,000 (“Note 1“). Note 1 matures on September 12, 2024.
- A series of secured debentures (“Notes 2A, 2B and 2C“), with an aggregate principal amount of USD $9,505,000. Notes 2A, 2B and 2C mature on September 12, 2024.
- A secured debenture in the principal amount of CDN $2,120,000 (“Note 3“). Note 3 matures on September 12, 2024.
- A secured promissory note in the principal amount of USD $5,850,000 (“Note 4“). Note 4 matures on September 12, 2024.
- Two secured promissory notes in the aggregate principal amount of USD $10,800,000 that amend and restate convertible promissory notes previously issued to arm’s length lenders by RWB Platinum Vape Inc., a wholly-owned subsidiary of the Company, on October 4, 2021 (the “Amended PV Notes“). The Amended PV Notes are convertible into common shares of the Company at a price of USD $0.15 per share, representing a 67% premium to the closing price on September 16.
On the management side, the company announced that it has appointed Colby De Zen as the new President of Red White & Bloom Brands. Mr. De Zen was also appointed to the board of directors effective September 19, 2022. Mr. Gabriel Bianchi has also been named to the company’s board of directors. Mr. Bill Dawson has resigned from the board.
Brad Rogers, RWB Chairman and CEO: “After close consultation with various debt holders, we are pleased to have successfully restructured over CAD $100 million of our short-term debt. Today’s announcement is validation that our debtholders share our enthusiasm for long-term opportunities for growth at RWB. By extending the maturity to 2024, we have a significant runway to realize the operational changes we have made and to growth the Company is dedicated to achieving. The addition of Colby to the management team will further allow us to focus on margin growth, operational efficiencies and balance sheet improvements. I want to welcome Colby to the management team and Board.” Mr. Rogers further stated, “Gabriel has extensive experience in lease negotiations, optimizing real estate portfolios and foreseeing market trends. We look forward to Gabriel joining the Board of the Company upon completion of regulatory clearances; his assistance will be invaluable as we move to optimize and expand the significant footprint of locations currently held by the company in Michigan and Florida.”
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