Zenabis Global announced an agreement with Tilray subsidiary High Park Holdings for a dried cannabis supply worth an advance of C$30 million.
As quoted in the press release:
Under the terms of the Supply Agreement, Zenabis will deliver a monthly quantity of dried cannabis to High Park commencing in October 2019. Zenabis expects the prepaid amount to be retired within a year. Zenabis does not expect delivery commitments to High Park to impact its ability to supply existing customers. The wholesale pricing under the Supply Agreement will vary depending on the product type and format High Park elects to order.
“Zenabis is well-positioned to supply high-quality cannabis to High Park via this non-dilutive financing arrangement that capitalizes on our rapidly increasing annual cultivation capacity, which we expect to reach 131,200 kilograms of dried cannabis before deliveries to High Park are scheduled to commence,” said Andrew Grieve, Chief Executive Officer of Zenabis.
Mr. Grieve continued, “This arrangement significantly reduces the requirement for potential further draws on our C$60 million unsecured convertible debenture facility.”