NorthWestern sells $50 million bond, Flower One, Origin House get debt financing

By Devika Patel

Knoxville, Tenn., July 2 – Tuesday was active for the private placement markets, with three new deals announced.

Sioux Falls, S.D.-based NorthWestern Corp., an electricity and natural gas provider, settled a $50 million sale of 3.98% 30-year Montana first mortgage bonds; Toronto-based cannabis company Flower One Holdings Inc. settled a $30 million 10% debt financing with RB Loan Portfolio II, LLC; and Ottawa-based investor and operator in the legal cannabis sector CannaRoyalty Corp., doing business as Origin House, which is a growing cannabis brands and distribution company, arranged a C$12 million 10% debt financing with Opaskwayak Cree Nation.

NorthWestern issues bonds

NorthWestern sold $50 million of 3.98% 30-year Montana first mortgage bonds on June 26.

The notes are due on June 26, 2049 and have a make-whole call until Dec. 26, 2048, then a par call.

Flower One wraps loan

Flower One completed a $30 million 10% debt financing with RB Loan Portfolio II.

The loan initially has a two-year term and bears interest at Libor plus 800 basis points. The loan’s tenor may be extended by six months and the debt may be prepaid.

RB Loan also will receive 25% warrant coverage. The warrants may be exercised for 30 months at an exercise price equal to the greater of the 20-day volume weighted average price of the company’s common shares from the exercise date multiplied by 1.2 for half of the warrants and 1.4 for the other half and the closing market price of the shares on the trading day immediately preceding the exercise date.

The company has drawn an initial $20 million advance and issued 1,139,757 warrants with a strike price of C$3.46 and 1,139,757 warrants with a strike price of C$4.03.

Proceeds will be used to further invest in the company’s 400,000 square foot greenhouse and for general working capital and operational purposes.

Origin House financing

CannaRoyalty, doing business as Origin House, negotiated a C$12 million 10% debt financing with Opaskwayak Cree Nation.

The financing replaces the company’s previously announced C$12 million debt facility with a subsidiary of Sprott Inc., which has now been terminated.

The loan matures on Dec. 31, 2019.

Proceeds will be used for the construction and expansion of premium craft cannabis production facilities and for general corporate purposes.

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