The Canadian company announced an agreement to exchange approximately $124.3 million in principal amount of its 5.00% convertible senior notes due 2023 for common stock.
Tilray, Inc. (NASDAQ: TLRY), a global pioneer in cannabis research, cultivation, production and distribution, today announced that it has entered into a privately negotiated exchange agreement with a certain holder of its 5.00% Convertible Senior Notes due 2023 (the "Notes"). Pursuant to the exchange agreement, the Company will exchange approximately $124.3 million in aggregate principal amount of Notes plus accrued interest, for approximately 10.9 million shares of the Company's Class 2 common stock. The exchange transaction is expected to be completed on or about November 24, 2020, subject to customary closing conditions. Following the exchange transaction, approximately $350.7 million in aggregate principal amount of the Notes will remain outstanding.
Effectively, the Company agreed to repurchase a portion of its Notes at a 36% discount to their face value, using shares issued at the Company's most recent closing market price (which is equivalent to a conversion price of $7.36 per share).
The purpose of the transaction was to reduce the Company's debt and eliminate $6.2 million in annual cash interest costs.
The shares of the Company's Class 2 common stock issuable upon the exchange have not been registered under the Securities Act of 1933, as amended, or the securities laws of any state or other jurisdiction, and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements.
This press release does not constitute an offer to sell or a solicitation to buy any of the securities described herein, nor shall there be any sale of these securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful.
To learn more about Tilray, Inc. visit the company HQ here.
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