General Cannabis Corp (OTCMKTS:CANN) has provided an update on its recent restructuring initiative, stating that it has successfully engaged with all its creditors, beyond January 2017, and reached on separate agreements with them. As such, the company now expects all of its restructuring transactions to close by April 30, 2016.
Moreover, CANN would receive an extension in the dates of its indebtedness, up to at least January 31, 2017, without any changes in the initial conditions. However, in connection with the refinancing, General Cannabis would issue warrants of purchase of its common stock, at a share price of $1.07. These warrants would carry a one year term. It is expected that the company would issue a total of 750,000 such warrants, for the refinancing. General Cannabis has also disclosed that it expects to incur certain fees or non-cash expenses, but does not believe that it would be asked to prepay a premium.
The CEO of CANN, Robert Frichtel, stated that the agreements would allow his management to focus more on the current tasks at hand. He was also of the opinion that the agreements hint at the confidence of the company’s creditors in the management’s capability to execute current business plans effectively. The CEO also clarified that current objectives for the management now include enhancing shareholder value and organic growth of the company.
The Executive Chairman of CANN, Michael Feinsod, revealed that his company was looking towards future expansion and acquisitions. The recent agreements would now allow his company to proceed with its plans, without much trouble. General Cannabis recently filed its 4Q2015 as well, reporting revenues of $0.69 million, resulting in a net loss of $1.91 million. However, the company did report a significant improvement in gross margins, from -755.6% to -21.66%. The company reported that the earnings growth was a result of one-time sales as well as regular items.
General Cannabis Corp (OTCMKTS:CANN) gained 18.2% during the April 15 trading session, to reach a close at $1.50, after a trade volume of 511,524 shares.