Arise Bioscience, a Florida-based hemp-derived CBD subsidiary of TerrAscend Corp., has received a $ 20 million loan from Canopy Growth of Canada.
The funds must not be used in connection with any marijuana or marijuana-related transactions in the United States “unless and until such transactions comply with all applicable laws of the United States”, according to a declaration announcing the deal on Thursday.
In return for this loan, TerrAscend, a prescription cannabinoid manufacturer headquartered in Mississauga, Ontario, issued 2,105,718 common share purchase warrants to Canopy Growth.
Canopy Growth co-invested in TerrAscend in November 2017 and a year later announced the completion of a restructuring transaction with TerrAscend whereby TerrAscend restructured its share capital under the Business Corporations Act from Ontario.
Canopy Growth loaned C $ 80.5 million ($ 63 million) to TerrAscend Canada Inc. in March of this year. Latest TerrAscend loan comes after Canopy announced it was formwork more installations across Canada amid a new round of layoffs in an attempt to streamline operations and improve margins.
“With this additional loan in TerrAscend’s Arise business unit, we are confident that the team will continue to perform at a high level and are well positioned to generate strong value creation for Canopy’s shareholders.” Canopy Growth CEO David Klein said in the statement.
The loan proceeds are expected to be used by Arise for general corporate purposes, debt repayment or other purposes authorized under the agreement. Arise is based in Boca Raton, Florida.