MTL Cannabis Corp. Closes $27 Million Credit Facility with Canadian Schedule 1 Bank
Refinances approximately $19 million of current debts, consolidating and strengthening the Company's balance sheet
Postponing and subordinating approximately $8 million in shareholder loans from the Company's founders, further bolstering liquidity
PICKERING, ON, July 30, 2025 /CNW/ – MTL Cannabis Corp. (CSE: MTLC) (OTCQX: MTLNF) (the 'Company') is pleased to announce that it has closed a credit agreement (the 'Credit Facility') with a leading Canadian Schedule 1 bank for an aggregate of approximately $27 million. The purposes of the Credit Facility are to (i) assist with growth capital expenditures, (ii) finance working capital needs for the Company, and (iii) refinance pre-existing debts (the 'Existing Debts').
The Credit Facility is comprised of (i) an uncommitted demand revolving credit facility of up to $4,000,000, margined against the eligible account receivables of the company (ii) a committed non-revolving term credit facility available by way of a single drawdown in an amount equal to $6,750,000, with a contractual term of three (3) years, (iii) a committed non-revolving term credit facility available by way of a single drawdown in an amount equal to $12,150,000, with a contractual term of three (3) years, and (iv) an uncommitted delayed draw non-revolving term credit facility available by way of one or more drawdowns in a total aggregate amount of $4,120,000.
The Credit Facility will bear an interest rate of Prime or adjusted term CORRA plus an applicable margin. The Credit Facility is secured against (i) all of the present and after-acquired undertakings, property and assets of the Company and its material operating subsidiaries, and (ii) the property located at 551 Rue Saint-Marc, Louiseville, QC, by a first-ranking collateral mortgage.
'We are incredibly excited to partner with the team to finance the continued growth of the business and strengthen our balance sheet,' said Michael Perron, CEO of the Company. 'We fully appreciate the confidence that the bank has in our management team and the business we have built, and we look forward towards repaying that trust with continued performance as we grow together in the coming years.'
The Existing Debts being refinanced under the Credit Facility were derived solely from the predecessor business of Canada House Cannabis Corp. and incurred prior to the completion of the business combination of Canada House Cannabis Corp. and Montréal Cannabis Médical Inc., and include the entirety of the $8,316,830.21 in amounts payable pursuant to the convertible debenture issued on August 4, 2020, as amended, to Archerwill Investments Inc., and delivery of all remaining related 14,466,568 prepayment warrants with an exercise price $0.5749; $10,041,094.94 in amounts payable pursuant to the historical acquisition of IsoCanMed Inc. that closed June 12, 2020; and approximately $575,000 in amounts payable pursuant to the secured debentures issued on December 5, 2017.
'We view the refinancing of the legacy Canada House creditors as the final chapter in the closing of the business combination between Canada House and MTL Cannabis,' added Richard Clement, Chairman and co-founder of MTL Cannabis Corp. 'We are extremely proud of managements' financial stewardship of the combined company and the turnaround of our financial position that this milestone symbolizes.'
About MTL Cannabis Corp.
MTL Cannabis Corp. is the parent company of Montréal Medical Cannabis Inc. ('MTL Cannabis'), a licensed producer operating from a 57,000 sq ft licensed indoor grow facility in Pointe Claire, Québec; Abba Medix Corp., a licensed producer in Pickering, Ontario that operates a leading medical cannabis marketplace; IsoCanMed Inc., a licensed producer in Louiseville, Québec growing best-in-class indoor cannabis, in its 64,000 sq. ft. production facility; and Canada House Clinics Inc., operating clinics across Canada that work directly with primary care teams to provide specialized cannabinoid therapy services to patients suffering from simple and complex medical conditions.
As a flower-first company built for the modern street, MTL Cannabis uses proprietary hydroponic growing methodologies supported by handcrafted techniques to produce products that are truly craft for the masses. MTL Cannabis focuses on craft quality cannabis products, including lines of dried flower, pre-rolls and hash marketed under the 'MTL Cannabis', 'Low Key by MTL' and 'R'belle' brands for the Canadian market through nine distribution arrangements with various provincial cannabis distributors. MTL Cannabis has also developed several export channels for bulk and unbranded GACP quality cannabis.
It is the Company's goal for Abba Medix Corp. to become the leading distributor of medical cannabis in Canada and for Canada House Clinics Inc. to be the leading Canadian provider of medical cannabis clinic services.
For further information, please visit www.mtlcorp.ca/ or the Company's public filings at www.sedarplus.ca.
Cautionary Statement Regarding Forward-Looking Information.
This press release contains forward- looking statements, including statements that relate to, among other things, drawdowns and use of proceeds from the Credit Facility, including the repayment of the Existing Debts, the Company's clinic, production and technology businesses, its future plans, the Company's markets, objectives, goals, strategies, intentions, beliefs, expectations and estimates, and can generally be identified by the use of words such as 'may', 'will', 'could', 'should', 'would', 'likely', 'possible', 'expect', 'intend', 'estimate', 'anticipate', 'believe', 'plan', 'objective' and 'continue' (or the negative thereof) and words and expressions of similar import. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, such statements involve risks and uncertainties, and undue reliance should not be placed on such statements. Certain material factors or assumptions are applied in making forward-looking statements, and actual results may differ materially from those expressed or implied in such statements. Material assumptions used to develop forward-looking information in this news release include, the regulations related to cannabis use under the Cannabis Act (Canada); Company liquidity and capital resources, including the availability of additional capital resources to fund its activities and repay its outstanding indebtedness; level of competition; the ability to adapt products and services to the changing market; the ability to attract and retain key executives; the ability to execute strategic plans; continued integration of business unit, expansion activities at all our operating locations; and the leveraging of cash flow from operations to accelerate growth and further improve the Company's balance sheet. Additional information about material factors that could cause actual results to differ materially from expectations and about material factors or assumptions applied in making forward-looking statements may be found in the Company's Listing Statement dated August 14, 2023 and its most recent annual and interim Management's Discussion and Analysis under 'Risk and Uncertainties' as well as in other public disclosure documents filed with Canadian securities regulatory authorities. The Company does not undertake any obligation to update publicly or to revise any of the forward-looking statements contained in this document, whether as a result of new information, future events or otherwise, except as required by law.
Neither the Canadian Securities Exchange (the 'CSE') nor its Regulation Services Provider (as that term is defined in the policies of the CSE) accepts responsibility for the adequacy or accuracy of this release.
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