CALGARY, AB – High Tide Inc. closed a subordinated debt facility of $1,000 principal subordinate secured debentures of the Company for aggregate gross proceeds of $15 million at a price of $900 per Debenture, pursuant to subscription agreements with arm’s length institutional credit providers.
The Debentures will mature on July 31, 2029, and bear interest at a fixed rate of 12% per annum on drawn amounts, payable quarterly. The Debentures are governed by the terms and conditions of a debenture trust indenture between the Company and Olympia Trust Company in its capacity as trustee and collateral agent. The Company may redeem the Debentures at any time prior to maturity, in whole or in part, upon sixty days’ notice and payment of certain penalties as applicable. The Company’s obligations under the Debentures are collaterally secured by general security and guarantee agreements from the Company and certain subsidiaries of the Company and rank in second position to the Company’s existing senior lender.
Pursuant to the terms of the subscription agreements, the Debentures will be drawn in two tranches: (i) $10,000,000 principal amount which has been drawn on the initial closing and (ii) $5,000,000 in November 2024. The Final Tranche, until drawn, will be subject to a 1% per annum standby fee.
In connection with the closing of the Initial Tranche, the Company issued an aggregate of 230,760 common shares of the Company at a price of $3.47 per Common Share to the Lenders. The TSX Venture Exchange has conditionally approved the issuance of the Common Shares. Issuance of the shares will be subject to the Company fulfilling all of the listing requirements of the TSXV for its final approval.
Ventum Capital Markets is acting as financial advisor to the Corporation in connection with arranging the Facility.
All Debentures and Common Shares issued pursuant to the Facility will be subject to a statutory hold period of four months plus one day from the date of issuance in accordance with applicable securities legislation in Canada and restrictions on resale in the United States with applicable U.S. restrictive legends as required pursuant to the United States Securities Act of 1933, as amended.
The net proceeds of the Facility will be used for debt repayment, ongoing development of the Company’s business model and general working capital purposes.
ABOUT HIGH TIDE
High Tide consistently moves ahead of the currents, having been named one of Canada’s Top Growing Companies in 2021, 2022 and 2023 by the Globe and Mail’s Report on Business Magazine, and was named as one of the top 10 performing diversified industries stocks in both 2022 and 2024 TSX Venture 50. High Tide was also ranked number one in the retail category on the Financial Times list of Americas’ Fastest Growing Companies for 2023.
