iAnthus (OTC: ITHUF) stock popped over 57% to lately sell at 29 cents after the company was able to close on an $11 million bridge financing funded by certain lenders affiliated with the counterparties to the previously announced restructuring support agreement dated July 10, 2020. They are the holders of all of the 13% senior secured convertible debentures issued by iAnthus Capital Management, LLC and the holders of 91% of the principal amount of 8% convertible unsecured debentures issued by iAnthus.
Randy Maslow, Interim Chief Executive Officer and President of the Company said in a statement, “We are very pleased to have closed this bridge note financing. The net proceeds from the financing will be used exclusively for our operations in New Jersey for the continued construction and completion of improvements at our New Jersey cultivation, manufacturing, and dispensary facilities. We expect to sublease these facilities to MPX NJ once construction is complete and the facilities are ready to commence licensed operations.”
MPX NJ Battle
The battle between MPX New Jersey and iAnthus NJ continues even as iAnthus secured the financing. which will be used primarily for the construction and improvements of certain New Jersey facilities leased and/or owned by iAnthus NJ. These facilities are expected to be subleased to MPX New Jersey, with which the company has entered into several contractual agreements as described below. These facilities include the cultivation and manufacturing facility currently under construction in Pleasantville and the current dispensary located in Atlantic City, as well as two prospective satellite dispensaries expected to be leased and/or purchased and improved by iAnthus NJ pursuant to satellite approval applications filed with the New Jersey Department of Health on December 31, 2020.
However, the Monmouth County Superior Court is allowing iAnthus to continue construction at the Pleasantville facility. Maslow said, “We are pleased with the Court’s ruling today in iAnthus’ favor, giving the Company the green light to continue its ongoing build-out of the Pleasantville cultivation and processing facility, which is important to New Jersey’s goal of providing additional supply as quickly as possible to the state’s medical cannabis patient population. The Court recognized iAnthus’ substantial interest in completing the construction of the cultivation facility, especially given the Company’s contractual rights to acquire full ownership of MPX NJ, subject to regulatory approval. The Court’s ruling today, together with our closing yesterday on an $11 million financing earmarked solely for our NJ operations, gives us tremendous confidence in our ability to complete the cultivation, processing and associated dispensary facilities in a timely fashion for the benefit of New Jersey’s patients.”
Last week, the company announced that in a unanimous decision, the British Columbia Court of Appeal dismissed the appeal of Walmer Capital Limited, Island Investments Holdings Limited, and Alastair Crawford of the order of the Supreme Court of British Columbia made October 5, 2020, approving a plan of arrangement to implement the Company’s previously announced recapitalization transaction. Thus, effectively ending the shareholder fight.