Las Vegas-based marijuana producer Flower One announced proceeds of $10.1 million from a term loan with an unspecified existing shareholder and also modified previously existing debt as the company works to cut costs.
The existing debt, worth $30 million and secured against a Flower One facility, was modified to reduce the monthly interest payable, according to a news release.
Three Flower One executives have also agreed to pay cuts “to support the company’s ongoing restructuring and cash preservation efforts,” the company said Monday, and the board of directors has also reduced its compensation.
“The company has taken multiple measures to reduce its overall operating expenses by introducing automation and new equipment in multiple areas including but not limited to packaging, pre-roll, and vape-filling,” the release noted.
“With the closing of this debt financing and successful loan modification, we can complete the immediate facility improvements required that will better position the company for long term success as we prepare for a strong recovery from COVID-19 in Nevada,” Flower One President and CEO Kellen O’Keefe said in a statement.
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Flower One raised $5 million in a nonbrokered private placement last year.