Cannara Announces Amendment and Upsize of BMO Credit Facility to Support Facility Expansion at Valleyfield
Cannara Biotech (OTCQB: LOVFF) has announced significant amendments to its BMO credit facility, including a $10 million upsize to support strategic capital investments at its Valleyfield facility. The expanded facility includes a new Capital Expenditures Facility available through July 2026 with a 10-year amortization schedule.
The company has achieved multiple interest rate reductions, lowering its overall cost of debt from over 8% in 2024 to below 6%. Additionally, Cannara eliminated a limited recourse guarantee, resulting in annual interest expense savings of approximately $375,000.
The funding will support Valleyfield's post-harvest expansion, including new drying, freezing, trimming, and packaging capabilities, advancing toward the company's goal of 100,000 kg annual production capacity.
Cannara Biotech (OTCQB: LOVFF) ha annunciato modifiche rilevanti alla sua linea di credito con BMO, compreso un incremento di 10 milioni di dollari per sostenere investimenti strategici di capitale presso l’impianto di Valleyfield. La struttura ampliata prevede una nuova Capital Expenditures Facility disponibile fino a luglio 2026 con un piano di ammortamento decennale.
L’azienda ha ottenuto diverse riduzioni dei tassi d’interesse, portando il costo complessivo del debito da oltre l’8% nel 2024 a meno del 6%. Inoltre, Cannara ha eliminato una garanzia a responsabilità limitata, con un risparmio annuo sugli interessi di circa 375.000 dollari.
I fondi serviranno a sostenere l’espansione post-raccolta di Valleyfield, con nuovi impianti per essiccazione, congelamento, rifilatura e confezionamento, avvicinando l’azienda all’obiettivo di una capacità produttiva annua di 100.000 kg.
Cannara Biotech (OTCQB: LOVFF) ha anunciado enmiendas importantes a su línea de crédito con BMO, incluyendo un incremento de 10 millones de dólares para apoyar inversiones de capital estratégicas en su planta de Valleyfield. La facilidad ampliada incluye una nueva Capital Expenditures Facility disponible hasta julio de 2026 con un calendario de amortización a 10 años.
La compañía logró múltiples reducciones en las tasas de interés, disminuyendo el costo total de su deuda de más del 8% en 2024 a menos del 6%. Adicionalmente, Cannara eliminó una garantía de recurso limitado, generando un ahorro anual en gastos por intereses de aproximadamente 375.000 dólares.
Los fondos respaldarán la expansión postcosecha en Valleyfield, incluyendo nuevas capacidades de secado, congelación, recorte y envasado, avanzando hacia el objetivo de la compañía de una capacidad de producción anual de 100.000 kg.
Cannara Biotech (OTCQB: LOVFF)는 BMO 신용시설에 대한 중요한 변경 사항을 발표했으며, Valleyfield 시설의 전략적 자본투자를 지원하기 위해 1,000만 달러 증액을 포함합니다. 확장된 시설에는 2026년 7월까지 이용 가능한 새로운 자본 지출 펀드(Capital Expenditures Facility)와 10년 상환 일정이 포함되어 있습니다.
회사는 여러 차례 금리 인하를 이루어 2024년 8%대 초반 이상이던 총부채비용을 6% 미만으로 낮췄습니다. 또한 제한적 보증을 제거해 연간 이자비용을 약 37만5천 달러 절감했습니다.
이번 자금은 Valleyfield의 수확 후 확장(건조, 냉동, 다듬기 및 포장 설비 등)을 지원하여 회사의 연간 100,000kg 생산능력 목표 달성에 기여할 예정입니다.
Cannara Biotech (OTCQB: LOVFF) a annoncé des modifications significatives de sa facilité de crédit BMO, incluant une augmentation de 10 millions de dollars pour financer des investissements stratégiques en capital dans son site de Valleyfield. La facilité élargie comprend une nouvelle Capital Expenditures Facility disponible jusqu’en juillet 2026, avec un calendrier d’amortissement sur 10 ans.
La société a obtenu plusieurs baisses de taux d’intérêt, réduisant le coût total de sa dette de plus de 8 % en 2024 à moins de 6 %. De plus, Cannara a supprimé une garantie à recours limité, entraînant une économie annuelle d’intérêts d’environ 375 000 dollars.
Les financements soutiendront l’expansion post-récolte de Valleyfield, incluant de nouvelles capacités de séchage, congélation, émondage et conditionnement, ce qui rapproche l’entreprise de son objectif d’une capacité de production annuelle de 100 000 kg.
Cannara Biotech (OTCQB: LOVFF) hat wesentliche Änderungen an seiner BMO-Kreditfazilität bekanntgegeben, darunter eine Aufstockung um 10 Millionen US-Dollar zur Unterstützung strategischer Kapitalinvestitionen in der Anlage in Valleyfield. Die erweiterte Fazilität umfasst eine neue Capital Expenditures Facility, die bis Juli 2026 verfügbar ist und einen 10-jährigen Amortisationsplan aufweist.
Das Unternehmen erzielte mehrere Zinssatzsenkungen und reduzierte damit die gesamten Finanzierungskosten von über 8 % im Jahr 2024 auf unter 6 %. Zusätzlich hat Cannara eine beschränkte Bürgschaft aufgehoben, was jährliche Zinsersparnisse von rund 375.000 US-Dollar zur Folge hat.
Die Mittel werden die Post-Harvest-Erweiterung in Valleyfield unterstützen, einschließlich neuer Kapazitäten für Trocknung, Einfrieren, Trimmen und Verpackung, und bringen das Unternehmen dem Ziel einer jährlichen Produktionskapazität von 100.000 kg näher.
- Secured $10 million capital expenditures facility for strategic expansion
- Interest rate reduction from over 8% to below 6% on credit facility
- Annual interest expense savings of $375,000 from eliminated guarantee
- Strong financial performance leading to improved credit terms
- Expansion supports goal of reaching 100,000 kg annual production capacity
- Additional debt obligations through expanded credit facility
- Quarterly principal and interest payments required until December 2027
Expanded credit facility to fund initial post-harvest buildout at Valleyfield, supporting the Company’s long-term goal of reaching 100,000 kg annual capacity
MONTREAL, Aug. 21, 2025 (GLOBE NEWSWIRE) -- Cannara Biotech Inc. (“Cannara”, “the Company”, “us” or “we”) (TSXV: LOVE) (OTCQB: LOVFF) (FRA: 8CB0), a vertically integrated producer of premium-grade cannabis products at disruptive prices with two mega facilities based in Québec spanning over 1,650,000 sq. ft., is pleased to announce amendments to its existing credit facility with Bank of Montreal (“BMO”) acting as administrative agent, lead arranger, syndication agent and sole bookrunner (the “Restated Credit Facility”), including a
“These amendments to our credit facility with BMO reflect the confidence in Cannara’s growth strategy and operational performance,” said Zohar Krivorot, President & CEO of Cannara.
“With improved financial flexibility and reduced financing costs, we are well positioned to execute the expansion of our Valleyfield facility and deliver sustained value to our shareholders. Cannara remains committed to maintaining a strong balance sheet while investing in strategic initiatives that support long-term profitable growth,” added Nicholas Sosiak, Chief Financial Officer of Cannara.
The Restated Credit Facility includes the addition of a
The new Capital Expenditures Facility will fund the initial phase of Cannara’s post-harvest expansion at Valleyfield, introducing state-of-the-art hang-drying, freezing, trimming, and packaging capabilities, expanded processing and storage areas, and enhanced butane extraction capacity. By enabling upcoming cultivation room activations beyond the current 12 operating zones, this phase lays the foundation for Cannara’s next stage of growth and advances the Company toward its long-term goal of 100,000 kg in annual production capacity.
Previously Disclosed Amendments to the Restated Credit Facility
In addition to the Capital Expenditures Facility announced today, the Company has previously disclosed the following changes to the Restated Credit Facility.
- Interest Rate Reduction: On June 18, 2025, the Company announced that it had secured a total 50-basis-point reduction in the interest rate spread under the Restated Credit Facility, achieved in two stages: an initial 25-basis-point decrease through an amendment to the credit agreement, and a further 25-basis-point reduction triggered by meeting certain covenant thresholds as of the second quarter of fiscal 2025 (ended February 28, 2025). In Q4 2025, the Company achieved an additional 25-basis-point reduction after meeting key covenant thresholds as of Q3 2025, resulting in the full additional savings to be realized in reduced interest expense going forward. As a result, Cannara’s overall cost of debt under the credit facility declined from over
8% in 2024 to below6% , reflecting the Company’s strong financial performance and disciplined capital management. - Removal of Limited Recourse Guarantee: As previously disclosed in Cannara’s management’s discussion and analysis for the three-and nine-month periods ended May 31, 2025, in March 2025, the Company also successfully met key covenant thresholds under its credit agreement with BMO, eliminating the limited recourse guarantee provided by a related party. This milestone reduced annual interest expense by approximately
$375,000 , further strengthening Cannara’s capital structure.
For a full description of the BMO Restated Credit Facility, please refer to the Company’s Annual Information Form for the fiscal year ended August 31, 2024. A copy of the Restated Credit Facility is available under the Company’s profile on SEDAR+ at www.sedarplus.ca.
CONTACT
| Nicholas Sosiak, CPA, CA Chief Financial Officer nick@cannara.ca | Zohar Krivorot President & Chief Executive Officer zohar@cannara.ca |
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
ABOUT CANNARA
Cannara Biotech Inc. (TSXV: LOVE) (OTCQB: LOVFF) (FRA: 8CB0), is a vertically integrated producer of affordable premium-grade cannabis products for the Canadian markets. Cannara owns two mega facilities based in Québec spanning over 1,650,000 sq. ft., providing the Company with 100,000 kg of potential annualized cultivation output. Leveraging Québec’s low electricity costs, Cannara’s facilities produce premium-grade cannabis products at an affordable price. For more information, please visit cannara.ca.
CAUTIONARY STATEMENT REGARDING “FORWARD-LOOKING” INFORMATION
This news release may contain “forward-looking information” within the meaning of Canadian securities legislation (“forward-looking statements”). These forward-looking statements are made as of the date of this MD&A and the Company does not intend, and does not assume any obligation, to update these forward-looking statements, except as required under applicable securities legislation. All statements other than statements of historical facts included in this document constitute forward-looking information, including but not limited to statements with respect to Cannara’s increased production capabilities, debt structure and financial flexibility.
Forward-looking statements relate to future events or future performance and reflect Company management’s expectations or beliefs regarding future events and include, but are not limited to, the Company and its operations, its projections or estimates about its future business operations, its planned expansion activities, anticipated product offerings, the adequacy of its financial resources, the ability to adhere to financial and other covenants under lending agreements, future economic performance, and the Company’s ability to become a leader in the field of cannabis cultivation, production, and sales.
In certain cases, forward-looking statements can be identified by the use of words such as “plans,” “expects” or “does not expect,” “is expected,” “budget,” “scheduled,” “estimates,” “forecasts,” “intends,” “anticipates” or “does not anticipate,” or “believes,” or variations of such words and phrases or statements that certain actions, events or results “may,” “could,” “would,” “might” or “will be taken,” “occur” or “be achieved” or the negative of these terms or comparable terminology. In this document, certain forward-looking statements are identified by words including “may,” “future,” “expected,” “intends” and “estimates.” By their very nature, forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance, or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements.
Forward-looking information is based upon a number of assumptions and is subject to a number of risks and uncertainties, many of which are beyond our control, which could cause actual results to differ materially from those that are disclosed in, or implied by, such forward-looking information. These risks and uncertainties include, but are not limited to, the risk factors which are discussed in greater detail under “Risk Factors” in the Company’s AIF available on SEDAR+ at www.sedarplus.ca and under the “Investor Area” section of our website at https://www.cannara.ca/en/investor-area.
Other risks not presently known to the Company or that the Company believes are not significant could also cause actual results to differ materially from those expressed in its forward-looking statements. Although the forward-looking information contained herein is based upon what we believe are reasonable assumptions, readers are cautioned against placing undue reliance on this information since actual results may vary from the forward-looking information. Certain assumptions were made in preparing the forward-looking information concerning the availability of capital resources, business performance, market conditions, as well as customer demand. Consequently, all of the forward-looking information contained herein is qualified by the foregoing cautionary statements, and there can be no guarantee that the results or developments that we anticipate will be realized or, even if substantially realized, that they will have the expected consequences or effects on our business, financial condition or results of operation. Unless otherwise noted or the context otherwise indicates, the forward-looking information contained herein is provided as of the date hereof, and we do not undertake to update or amend such forward-looking information whether as a result of new information, future events or otherwise, except as may be required by applicable law.
FAQ
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