BZAM Ltd. announced that the Company has opted to proceed with a loan facility offered by the investment holding company of its Chairman and largest shareholder in lieu of the brokered private placement (the “Offering”) referenced in its press release of October 2, 2023. In place of the Offering, the Company has secured a loan today from the Chairman and largest shareholder of the Company of up to $3 million in aggregate, funded by way of one or more secured promissory notes (the “Loan“). The Loan will bear interest at a rate of prime plus 8% per annum and mature no earlier than April 1, 2025. The Loan is intended to be used for general corporate expenses and working capital purposes, with the initial tranche of $1.19 million being funded today.
Matt Milich, the Chief Executive Officer of the Company, stated: “We are pleased to have secured this non-dilutive financing and grateful for the continuing support of our Chairman. This funding provides additional flexibility as we look to expand revenue and market share in Q4 and beyond from our increasingly streamlined and efficient cost base.”
The Company’s Chairman and largest shareholder, who is an insider of the Company, will be issuing the Loan. Accordingly, the Loan is considered to be a “related party transaction” for purposes of Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions (“MI 61-101“). Pursuant to MI 61-101, the Company will file a material change report providing disclosure in relation to each “related party transaction” on SEDAR+ under BZAM’s issuer profile at www.sedarplus.ca. The Company is relying on exemptions from the formal valuation and minority shareholder approval requirements available under MI 61-101. The Company is exempt from the formal valuation requirement in section 5.4 of MI 61-101 in reliance on section 5.5(a) of MI 61-101 as the fair market value of the Loan is not more than the 25% of the Company’s market capitalization. Additionally, the Company is exempt from minority shareholder approval requirement in section 5.6 of MI 61-101 in reliance on section 5.7(1)(a) as the fair market value of the Loan is not more than the 25% of the Company’s market capitalization.
About BZAM Ltd.
BZAM Ltd. is a leading Canadian cannabis producer with a focus on branded consumer goods, innovation, quality, consistency, integrity and transparency. The BZAM family includes core brands BZAM™, TGOD™, ness™, Highly Dutch Organic™, TABLE TOP™, and partner brands Dunn Cannabis, FRESH and Wyld. BZAM operates facilities in BC, Alberta, Ontario and Quebec, as well as a retail store in Regina, Saskatchewan. tFor more information on BZAM Ltd., please visit www.bzam.com.
