Canopy Rivers (TSXV:RIV) announced an acceleration of its deal with joint venture partner PharmHouse and amended the terms of its deal with an undisclosed Ontario company.
As quoted in the press release:
Canopy Rivers is pleased to announce it has, through its wholly-owned subsidiary Canopy Rivers Corporation, entered into an incremental funding agreement with its joint venture partner PharmHouse Inc. (“PharmHouse”) and amended the terms of the Company’s global non-competition agreement with joint venture partner, 2615975 Ontario Limited (the “Joint Venture Partner”), to include additional rights in favour of the Company in the event the Joint Venture Partner commences operations in the U.S. cannabis market.
Under the terms of the agreement, the Company will provide up to C$40 million of secured debt financing (the “Loan”) with a three-year term and an annual interest rate of 12%, calculated monthly and payable quarterly after receipt of the sales license at PharmHouse’s initial production and processing facility. Proceeds are expected to be utilized to supplement personnel and logistics resources for domestic and international distribution, capital expenditures related to the ongoing upgrade and retrofit of PharmHouse’s nursery, processing and greenhouse infrastructure, working capital and other general corporate purposes.
In connection with the Loan, the Company and the Joint Venture Partner have agreed to extend the scope of the existing global non-competition agreement to include additional rights in favour of the Company in the event the Joint Venture Partner commences operations in the U.S. market. The non-competition agreement further aligns interests among the parties to pursue regulated cannabis opportunities together on a global scale. As international cannabis regulations continue to evolve, PharmHouse will be able to enter international markets with the benefits of the Company’s portfolio of specialists throughout the cannabis value chain, combined with the Joint Venture Partner’s extensive U.S., Mexican, and international contract manufacturing, brand development, and distribution relationships and expertise.