MediPharm Labs Signs Committed Term Sheet for $20 Million Debt Facility With Schedule 1 Bank
TORONTO, May 15, 2019 — MediPharm Labs Corp. (TSXV: LABS) (OTCQX: MEDIF) (FSE:MLZ) (“MediPharm Labs”) a leader in specialized, research-driven cannabis extraction and cannabinoid isolation, is pleased to announce that its wholly-owned subsidiary, MediPharm Labs Inc. (“MediPharm”), has signed a committed term sheet for a $20 million senior secured revolving credit facility (“Credit Facility“) from a Canadian Schedule 1 Bank. The Credit Facility is intended to provide MediPharm Labs access to non-dilutive capital to fund planned growth, as well as for general corporate and working capital purposes.
The Credit Facility consists of a $15 million operating loan with a one-year term and a $5 million non-revolving equipment term loan with a three-year term. The Credit Facility, once closed, will bear interest at the Schedule 1 Bank’s prime lending rate plus 1.85% per annum.
“This commitment marks yet another important milestone that will provide access to non-dilutive capital to support our plans for accelerated growth as we continue to ramp up operations ahead of expected legalization of broader concentrate-based products this fall,” said, Patrick McCutcheon, CEO, MediPharm Labs. “We are pleased to have a leading financial institution support MediPharm Labs as we continue to innovate and expand our private and white label offerings to serve a growing demand for high-quality, adult-use and medical cannabis products.”
The committed term sheet dated May 14, 2019 is non-binding and MediPharm’s ability to draw down on the Credit Facility is subject to the negotiation and execution of a definitive credit agreement, guarantees, and security documents (collectively, the “Credit Documents”) as well as the satisfaction of other customary closing and drawdown conditions. The Credit Facility will also be subject to certain customary financial and other covenants for a financing of this type. There is no assurance that the Credit Documents will be completed or that any amount will be drawn under the Credit Facility. Amounts drawn under the Credit Facility will be guaranteed by MediPharm Labs and MediPharm Labs Australia Pty. Ltd.
About MediPharm Labs Corp.
Founded in 2015, MediPharm Labs has the distinction of being the first company in Canada to become a licensed producer for cannabis oil production under the ACMPR without first receiving a cannabis cultivation license. This expert focus on cannabis concentrates from being built to cGMP (current Good Manufacturing Practices) and ISO standard-built clean rooms and critical environments laboratory, allows MediPharm Labs to produce purified, pharmaceutical-like cannabis oil and concentrates for advanced derivative products. MediPharm Labs has invested in an expert, research-driven team, state-of-the-art technology, downstream extraction methodologies and purpose-built facilities to deliver pure, safe and precisely-dosed cannabis products to patients and consumers. MediPharm Labs’ private label program is a high margin business for the company, whereby it opportunistically procures dry cannabis flower and trim from its numerous product supply partners, to produce cannabis oil concentrate products for resale globally on a private label basis.
Through its subsidiary, MediPharm Labs Australia Pty. Ltd., MediPharm Labs has also completed its application process with the federal Office of Drug Control to extract and import medical cannabis products in Australia.
For further information, please contact:
Laura Lepore, VP, Investor Relations
Telephone: 705-719-7425 ext 216
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CAUTIONARY NOTE REGARDING FORWARD-LOOKING INFORMATION:
This news release contains “forward-looking information” and “forward-looking statements” (collectively, “forward-looking statements”) within the meaning of the applicable Canadian securities legislation. All statements, other than statements of historical fact, are forward-looking statements and are based on expectations, estimates and projections as at the date of this news release. Any statement that involves discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions, future events or performance (often but not always using phrases such as “expects”, or “does not expect”, “is expected”, “anticipates” or “does not anticipate”, “plans”, “budget”, “scheduled”, “forecasts”, “estimates”, “believes” or “intends” or variations of such words and phrases or stating that certain actions, events or results “may” or “could”, “would”, “might” or “will” be taken to occur or be achieved) are not statements of historical fact and may be forward-looking statements. In this news release, forward-looking statements relate to, among other things, among other things, statements regarding accelerated growth, expected legalization of broader concentrate-based products, the innovation and expansion of private and white label offerings, growing demand for high-quality, adult-use and medical cannabis products, the establishment and licensing of operations in Australia, and expectations that the Credit Facility and Credit Documents, and related drawdowns, will be completed on the disclosed terms or at all. Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable, are subject to known and unknown risks, uncertainties, and other factors which may cause the actual results and future events to differ materially from those expressed or implied by such forward-looking statements. Such factors include, but are not limited to: general business, economic, competitive, political and social uncertainties; the inability of MediPharm Labs to obtain adequate financing; the delay or failure to receive regulatory approvals: and other factors discussed in MediPharm Lab’ filings, available on the SEDAR website at www.sedar.com. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on the forward-looking statements and information contained in this news release. Except as required by law, MediPharm Labs assumes no obligation to update the forward-looking statements of beliefs, opinions, projections, or other factors, should they change.