Zenabis Announces Extension of Unsecured Convertible Notes
Vancouver, British Columbia – October 19, 2020 – Zenabis Global Inc. (TSX:ZENA) (“Zenabis” or the “Company”) is pleased to announce that it has entered into definitive agreements (the “Note Amending Agreements”) with the holders (the “Noteholders”) of two of the unsecured convertible notes originally issued by Zenabis Investments Ltd. on October 17, 2018, as amended on January 3, 2019 (each, a “Note” and collectively, the “Notes”). Such Notes have an aggregate principal amount of $6,400,000 with a prior maturity date of October 17, 2020. The key terms of the Note Amending Agreements include:
- the deferral of the maturity date of the Notes from October 17, 2020 to June 30, 2021 (the “New Maturity Date”); and
- Zenabis’ issuance of 1,237,500 common share purchase warrants (“Warrants”) to each Noteholder. Each Warrant entitles the Noteholder to purchase a common share in the capital of Zenabis at an exercise price of $0.15 for a period of five years from the date of issue.
Additionally, the holder of a third Note with a principal amount of $2,600,000 has delivered an interim waiver (the “Waiver”) of any default under such Note upon its maturity to facilitate ongoing negotiations for the extension or settlement of such Note.
All of the Notes with a maturity date of October 17, 2020 were covered by the Note Amending Agreements or the Waiver.
The Toronto Stock Exchange (the “TSX”) has not approved the issuance of the Warrants and the issuance of these securities is subject to TSX approval.
Zenabis is a significant Canadian licensed cannabis cultivator of medical and recreational cannabis, and a propagator and cultivator of floral and vegetable products. Zenabis employs staff coast-to-coast, across facilities in Atholville, New Brunswick; Delta, Aldergrove, Pitt Meadows and Langley, British Columbia; and Stellarton, Nova Scotia. Zenabis currently has 111,200 kg of licensed cannabis cultivation space across four licensed facilities. Zenabis has 3.5 million square feet of total facility space dedicated to a mix of cannabis production and cultivation and its propagation and floral business.
Zenabis expects its Zenabis Atholville, Zenabis Stellarton and Zenabis Langley facilities to be in steady state production in 2020. The Zenabis brand name is used in the cannabis medical market, the Namaste, Blazery and Re-Up brand names are used in the cannabis adult-use recreational market.
Forward Looking Information
This news release contains statements that may constitute “forward-looking information” within the meaning of applicable Canadian securities legislation. This forward-looking information includes, among other statements, statements regarding the closing of the transactions contemplated by the Note Amending Agreements; Zenabis’ issuance of 1,237,500 common share purchase warrants (“Warrants”) to each Noteholder; the issuance of these securities is subject to TSX approval and the future plans, costs, objectives or performance of Zenabis, or the assumptions underlying any of the foregoing. In this news release, words such as “may”, “would”, “could”, “will”, “likely”, “believe”, “expect”, “anticipate”, “intend”, “plan”, “estimate” and similar words and the negative form thereof are used to identify forward-looking statements. Forward-looking statements should not be read as guarantees of future performance or results, and will not necessarily be accurate indications of whether, or the times at or by which, such future performance will be achieved. No assurance can be given that any events anticipated by the forward-looking information will transpire or occur. Forward-looking information is based on information available at the time and/or management’s good-faith belief with respect to future events and are subject to known or unknown risks, uncertainties, assumptions and other unpredictable factors, many of which are beyond Zenabis’ control. These risks, uncertainties and assumptions include, but are not limited to, those described in the annual information form dated March 30, 2020, a copy of which is available on SEDAR at www.sedar.com and could cause actual events or results to differ materially from those projected in any forward-looking statements. Furthermore, any forward-looking information with respect to available space for cannabis production is subject to the qualification that management of Zenabis may decide not to use all available space for cannabis production, and the assumptions that any construction or conversion would not be cost prohibitive, required permits will be obtained and the labour, materials and equipment necessary to complete such construction or conversion will be available. Accordingly, readers should not place undue reliance on the forward-looking statements and information contained in this news release. Zenabis does not intend, nor undertake any obligation, to update or revise any forward-looking information contained in this news release to reflect subsequent information, events or circumstances or otherwise, except if required by applicable laws.
For more information, visit: https://www.zenabis.com.