Harvest Health & Recreation Inc (OTCMKTS:HRVSF) revealed earlier this month that its Board of Directors has approved a plan to increase the firm’s foreign private issuer threshold by 9.99%.
The approval will allow the company to expand the foreign private issuer threshold from the current 40% to 49.99%. The threshold increment is also in line with Harvest Health’s guidelines. The company operates as a foreign private issuer in the U.S which means that U.S residents directly or indirectly own less than 50% of the firm’s stake.
“Our vision is to become the most valuable cannabis company in the world and the adjustments related to the FPI per the Board consent will help fuel Harvest’s growth,” stated Steve White, the CEO of Harvest Health.
White also noted that it is important for any company to have access to a decent capital pool to secure long-term success. It also falls in line with Harvest Health’s goal of giving customers a high-quality experience. The Board of Directors’ consent also allows for the appointment of an officer that will make sure the firm complies with the company’s articles as part of its FPI status.
The Articles allow Multiple Voting Shares (MVS) to be converted to Subordinate Voting Shares (SVS) but only if they do not surpass the set threshold, in this case, the 49.99% level. The Articles require the firm to employ reasonable commercial efforts to make sure that conversions such as the recently announced ones do not surpass the 49.99% threshold.
Harvest Health secures $225 million credit facility to finance its expansion
Harvest Health also announced at the end of July that it secured a loan of $225 million which it plans to use fund its expansion plans in the cannabis industry. The company will receive the loan in three tranches of $75 million.
The loan will be backed by Torian Capital Partners which is a well-known investment firm in Miami. Harvest also announced that the funds will be used to secure strategic acquisitions, to boost working capital and also to support the company’s general corporate purposes. Harvest Health will secure the loan through its assets which include dispensary licenses.