Zenabis Global (TSX: ZENA) has further pushed out certain of its debts, keeping in line with its recent trend. Rather than pay down $6.4 million in principal that was due October 17, 2020, the company has managed to push off the debt yet again.
The debt in question that has been renegotiated yet again appears to be the unsecured convertible notes issued on October 17, 2018. At the time, the notes were issued as a means of refinancing certain shareholder loans that were outstanding at the time. The cost of capital for this debt has continued to climb as Zenabis continuously renegotiates the maturity date on the debt.
The debt was to initially maturity in October 2019, which was delayed in January 2019 as the company came to realize it would not be able to cover the debt payment. It was then renegotiated with a lower conversion rate in November following the rights issuance conducted by the company, with that exchange rate having fallen to $1.91 per share.
Then again in May 2020 some of the debt was renegotiated, with a portion being exchanged at $0.07 per share, and another portion seeing the maturity date extended to June 2022.
Now, $6.4 million in principal that was due to be paid out by the 17th has been delayed until June 30, 2021. In exchange for this, 1,237,500 common share purchase warrants with an exercie price of $0.15 has been issued to the noteholders. The warrants have an expiry of five years from the date of issue.
Further, a final noteholder who owns $2.6 million in principal of this October 17, 2020 debt has issued an interim waiver of any default to enable further negotiations to occur for the extension or settlement of the debt – meaning it appears that Zenabis is simply unable to pay its debts. All of the principal due October 17 as a result has been delayed or renegotiated at this time.
Zenabis Global last traded at $0.055 on the TSX.
Information for this briefing was found via Sedar and Zenabis Global Inc. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
As the founder of The Deep Dive, Jay is focused on all aspects of the firm. This includes operations, as well as acting as the primary writer for The Deep Dive’s stock analysis. In addition to The Deep Dive, Jay performs freelance writing for a number of firms and has been published on Stockhouse.com and CannaInvestor Magazine among others.