Mr. Edward Fields reports
DIONYMED BRANDS PROVIDES FINANCING UPDATE, ANNOUNCES REORGANIZATION AND RESUMPTION OF TRADING
Dionymed Brands Inc. has received additional investment from its senior secured investor of $3.2-million (U.S.) and has reorganized its business to right size the company. This increases the credit facility with the senior lender to $19.2-million (U.S.). The credit facility bears interest at Libor (at a floor of 2.5 per cent) plus 12 per cent plus an anniversary fee of 2.5 per cent, maturing Feb. 6, 2021. While the credit facility is currently in default, the senior lender has agreed to make additional advances to the company.
In addition, the company has reduced its operating expenses through a targeted reduction of head count from 299 to 199 allowing the company to amplify its focus on growing its direct-to-consumer cannabis delivery service Chill. These improvements, in conjunction with a revamped marketing strategy and focus on higher-margin products, began in Q3 and will continue through 2019.
The company's shares have resumed trading on the Canadian Securities Exchange under the symbol DYME and on the OTCQB under the symbol DYMEF. The company requested a halt in trading when there was a strong possibility it would announce a transaction in the ensuing days; however, multiple other potential transactions of various types have surfaced, all of which require more time for evaluation. The company is not able to say with certainty whether any of these transactions will be considered, or if considered, entered into, and will provide an update in due course. Any transaction may be subject to definitive documentation, corporate approvals, and other regulatory and third party approvals.
"With respect to these changes," said Dionymed chief executive officer Ed Fields, "we're looking forward to improving market efficiencies and getting the business to breakeven at an accelerated pace. We're excited about finalizing a deal with the right strategic partner and injecting the capital necessary to drive Dionymed forward as a leader in the cannabis industry."
The company is also announcing that Gotham Green has issued a request for repayment of its outstanding balance of $2.2-million (U.S.) representing the credit advance made on July 30, 2019, plus accrued and unpaid interest.
Founded in 2017, Dionymed is a multistate cannabis brands platform, supporting cultivators, manufacturers and award-winning brands in the medical and adult-use cannabis markets. Dionymed sells branded products in every category from flower to vape cartridges, concentrates and edibles. Dionymed serves cannabis consumers through retail dispensary distribution and direct-to-consumer fulfilment with its growing portfolio of award-winning brands.
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