Cannabis Company 4Front Announces Broker Offering Of Up To $3.6M In Units, Here's Where The Money Will Go

4Front Ventures Corp. FFNT FFNTF announced on Thursday it seeks to secure roughly CA$5 million ($3.65 million) in financing.

What Happened

The Arizona-based company said that it has entered into an agreement with Eight Capital, as lead agent and sole book-runner, on behalf of a syndicate of agents to be formed, to act as agents on a “best efforts” basis to sell up to 47,620,000 of its units at CA$0.105 per unit for gross proceeds of up to CA$5,000,100.

Under the agreement, each unit will consist of one class A subordinate voting share of 4Front  and one SVS purchase warrant, with each warrant entitling the holder thereof to purchase one additional SVS for 60 months following the closing of the offering at CA$0.13 per warrant share.

The agents have an option to ‎offer for sale up to an additional 15% of the units, at the offering price, ‎exercisable in ‎whole or in part at any time for up to 48 hours ‎before the closing date of the offering.‎

See also: Cannabis Company 4Front Reports 28% YoY Drop In Q1 Revenue While Net Loss Grows, CEO Optimistic With Biden’s Marijuana Rescheduling News

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Why It Matters

The company said it plans to utilize the net proceeds of the offering to buy equipment, inventory, cultivation inputs, and additional retail licenses and complete the buildout of its new retail locations.

What's Next

The closing of the offering is subject to receipt of all necessary regulatory approvals, including the approval of the Canadian Securities Exchange (CSE). The closing of the offering is expected to occur on or about July 10, 2024.

Subject to the listing requirements of the CSE 4Front intends to have the warrants listed on the CSE upon closing the offering.

Now read: 4Front Ventures FY Revenue Drops 10% As Net Loss Increases, CEO Offers Optimistic Projections

FFNTF Price Action

4Front shares traded at $0.098 per share after the market close on Wednesday afternoon.