The Loan Would Have Been Due this April, Extension Gives TransCanna Increased Financial Flexibility
TCAN Stock Continues to Outperform the Cannabis Sector Gaining Over 188% From December Low
TransCanna Holdings (CSE: TCAN) (OTC: TCNAF) (FSE: TH8) announced this morning that its subsidiary Dalvi, LLC has struck a deal with its lender Cool Swang, LLC to further extend the maturity date of the promissory note representing a USD $6,750,000 loan.
The loan was used to fund a portion of the purchase cost of its Lyfted Farms Daly facility in Modesto, California. The note was set to mature in April 2020 but has now been extended by an additional 2 years to April 2022.
Previously, the note’s maturity date had been extended once prior and this new 2-year extension allows TransCanna to reduce its 2020 debt by over 60%. The extension also provides the company with increased flexibility in regards to refinancing options on the Daly facility building.
“This debt extension is very positive for TransCanna. It reduces our 2020 debt by over 60% and puts our short-term debt in a very manageable position. With our current growth trajectory, we expect to be in a strong cash position as we move through the year. The extended maturity date will also provide us with flexibility with respect to refinancing options on the Daly building,” stated TransCanna President and CEO Steve Giblin.
As per the terms of the deal, Dalvi will pay an extension fee of USD $135,000 to Cool Swang on January 15, 2020, and the interest rate will increase from 7% to 12% effective January 1, 2020. The company reserves the right to prepay any or all of the principal amount owing on the note at its discretion with a penalty.
“We have a good business relationship with TransCanna. The TransCanna team in Modesto is committed to working closely with the city, county and state to build a successful organization and make a strong contribution to the community,” added Chad Swan, one of the principals of Cool Swang.
TCAN Stock Continues to Outperform Sector
Shares of TransCanna’s CSE listed stock closed trading today at $1.38 per share, up another 2.2% on the day. Since hitting a December low of $0.485 early in the month, TCAN stock has soared over 188.66%. TransCanna has been one of the top-performing cannabis stocks over the past 2 months and with the sector starting to heat up again, investors should expect to see TCAN shares continue its upward trajectory. As we’ve mentioned in previous articles, during the first 4 months of 2019, TCAN skyrocketed 873.75% ($0.80 – $7.79). As we kick-off 2020, TransCanna looks to be well on its way to a possible repeat of its Q1 2019 meteoric rise.
In the United States, TransCanna’s OTC Markets listed TCNAF stock closed today’s trading session at $1.05 per share, up nearly 2% on the day. Over in Germany on the Frankfurt Stock Exchange, the company’s Frankfurt listed TH8 shares closed today up 0.22% at $0.91 per share.
Taking a look at the 1-year TCAN chart below, it’s clear TransCanna has enormous upside from current levels. TCAN stock reached an impressive high of $7.79 on April 25, 2019, and with the stock closing at $1.38 today, matching its previous high would represent a potential gain of 464.49% from this point.
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