Cannara Biotech Extends BMO Credit Facility and Convertible Debenture to Strengthen Financial Position

LOS ANGELES- Cannara Biotech Inc. has announced the extension and amendment of its existing credit agreement with the Bank of Montreal (BMO) and a convertible debenture with Olymbec Investments Inc. These strategic financial adjustments aim to enhance the company’s liquidity and support its long-term growth objectives.

Amended Credit Agreement with BMO

The revised credit facility with BMO includes several key modifications:

• Extended Maturity Date: The term has been prolonged to December 31, 2027, providing Cannara with an extended timeline to utilize the funds.

• Consolidated Debt Structure: The facility now comprises a $34.8 million term loan, a $10 million revolving credit line for general working capital, and a $5.6 million letter of credit to a provincial service provider to support the supply of electricity.

• Revised Financial Covenants: Adjustments to the covenants offer Cannara increased flexibility to pursue its strategic plans.

These changes are designed to streamline Cannara’s debt obligations and provide the financial agility necessary for sustained growth.

Convertible Debenture Amendment with Olymbec

In parallel, Cannara has amended its convertible debenture agreement with Olymbec Investments Inc., a significant shareholder. The amendments include:

• Extended Maturity Date: The debenture’s maturity has been extended to March 31, 2028.

• Partial Repayment Rights: Olymbec retains the right to demand partial repayments, subject to specific conditions and approvals.

• Interest Payment Terms: Interest incurred prior to September 30, 2025, may be paid in cash, common shares, or a combination thereof, at a conversion price of $1.80 per share, subject to regulatory approval. Post-September 30, 2025, interest will be paid quarterly in cash at an annual rate of 10.75%.

These amendments aim to align the debenture terms with Cannara’s financial strategy and operational needs.

Leadership Perspectives

Nicholas Sosiak, Chief Financial Officer of Cannara, stated, “Securing the extension of our credit facility with BMO and the support from Olymbec underscores their confidence in our long-term growth strategy and operational excellence. This financial flexibility enables us to continue executing our strategic objectives while maintaining disciplined growth.”