PureK Holdings Corp. Secures USD $10 Million Loan Financing
December 23 2020 - 7:00AM
PureK Holdings Corp. (the "
Company") (TSX
Venture: PKAN), formerly AF1 Capital Corp., is pleased to announce
that its subsidiary, PureKana, LLC ("
PureKana"),
has secured USD $10 million in loan financing under the Main Street
New Loan Facility ("
MSNLF"), a component of the
Federal Reserve’s Main Street Lending Program.
The Federal Reserve established the Main Street
Lending Program to support lending to for-profit businesses and
nonprofit organizations that were in sound financial condition
before the onset of the Covid-19 pandemic.
Under the terms of the loan, secured in
accordance with the general terms of the MSNLF, the USD $10 million
loan is for a five-year term and features an adjustable rate of
LIBOR (1- or 3-month rate). Interest payments will remain deferred
for one year, with any unpaid interest to be capitalized, and
principal payments on the loan are deferred for two years. The loan
provides for principal amortization of 15% at the end of the third
year, 15% at the end of the fourth year, and a balloon payment of
70% at maturity at the end of the fifth year. Prepayment of the
loan is permitted without penalty. The Company incurred transaction
and original fees of 2%, or USD $200,000, as well as a loan
brokerage fee of USD $100,000.
The Company intends to use the proceeds of the
loan for working capital, including for inventory purchases to
support US sales expansion and international market expansion,
mergers and acquisitions, marketing and other operating expenses of
PureKana.
“We are delighted to have qualified for and
obtained this loan on the strength of our track record of
profitability and positive EBITDA,” said Brian Meadows, Chief
Financial Officer of PureK Holdings Corp. “This loan provides
PureKana with low-cost capital to grow its business in its core CBD
and evolving plant-based wellness products, both within the United
States as well as within select international markets.”
For more information about the Main Street
Lending Program please visit:
https://www.federalreserve.gov/monetarypolicy/mainstreetlending.htm.
About PureK Holdings Corp.
PureK Holdings Corp. indirectly owns a 50.1%
equity interest in PureKana. PureKana is recognized as a Top 10
cannabidiol ("CBD") brand in the United States and
has operated a profitable direct-to-consumer online business since
its inception in 2017. Its product lineup includes high quality
CBD that can be consumed in the form of tinctures, capsules,
topicals, patches, and gummies. PureKana's brand and
direct-to-consumer marketing expertise has helped to establish
PureKana as one of the leading online CBD brands in the United
States. The online presence is now being expanded into broader
retail outlets. PureKana operates legally in the jurisdictions
where it carries on business. PureKana's website is:
https://purekana.com/.
For further information:
Brian MeadowsChief Financial OfficerPh: +1 (855) 553-7441Email:
ir@purekana.com
Daniel NussbaumMedia and Investor RelationsPh: +1 (917)
232-8960Email: Daniel@amwpr.com
Forward-Looking Information
Certain statements contained in this news
release constitute "forward-looking information" and
"forward-looking statements" as such terms are used in applicable
Canadian securities laws. Forward-looking statements and
information are based on plans, expectations and estimates of
management at the date the information is provided and are subject
to certain factors and assumptions, including, that the Company’s
financial condition and development plans do not change as a result
of unforeseen events and that the Company obtains regulatory
approval. Forward-looking statements and information are subject to
a variety of risks and uncertainties and other factors that could
cause plans, estimates and actual results to vary materially from
those projected in such forward-looking statements and information.
Factors that could cause the forward-looking statements and
information in this news release to change or to be inaccurate
include, but are not limited to, the risk that any of the
assumptions referred to prove not to be valid or reliable, that
occurrences such as those referred to above are realized and result
in delays, or cessation in planned work, that the Company’s
financial condition and development plans change, and delays in
regulatory approval, as well as the other risks and uncertainties
applicable to the CBD industry and to the Company, as set forth in
the Company’s Filing Statement in respect of its qualifying
transaction filed under the Company’s profile at www.sedar.com. The
Company undertakes no obligation to update the forward-looking
statements and information, other than as required by applicable
law.
Neither the TSX Venture Exchange nor its
Regulation Services Provider (as that term is defined in the
policies of the TSX Venture Exchange) accepts responsibility for
the adequacy or accuracy of this press release.
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