Tilray Brands Inc (TLRY)

[BubbaInSC]

TLRY Bought HEXO's Massive Debt And Operational Losses

I'm not sure how the acquisition will move TLRY into being positive net profitable.

Just look at this crap in PR
4/10/23
https://www.businesswire.com/news/home/20230410005360/en/HEXO-Corp.-Announces-Acquisition-by-Tilray-Brands
WTF?

Pursuant to the Waiver and Amendment Agreement, Tilray has agreed, among other things, to waive the requirement under the Amended Senior Secured Note that HEXO achieve a positive Adjusted EBITDA (as defined therein) for the quarter ending April 30, 2023 and for subsequent quarters, and to amend the covenant set out under the Amended Senior Secured Note to reduce the minimum unrestricted cash balance required to be maintained by HEXO from US$20 million to US$4 million.

In consideration for the waivers and amendments provided under the Waiver and Amendment Agreement, HEXO has agreed to pay, and in certain cases accelerate the payment of, various amounts owing to Tilray under the existing Services Agreement between HEXO and a subsidiary of Tilray, the Amended Senior Secured Note and other commercial agreements between the parties and to pay various waiver, amendment and termination fees, which payments in the aggregate total approximately US$18.5 million (the “Aggregate Payment”), with an initial payment of approximately US$9.2 million made concurrently with entry into the Arrangement Agreement, a second payment of US$1 million in cash or by way of transfer of real property, to be made no later than May 1, 2023 and a final payment of approximately US$2.2 million to be made on the business day preceding the closing date of the Arrangement. Of the Aggregate Payment, US$6.0 million is being paid today through the transfer to Tilray of HEXO’s real estate properties located in Fort Collins, Colorado, and US$1 million will be paid either in cash, if HEXO successfully completes a sale of its Brantford, Ontario property to a third party under an ongoing sales process, or failing that, by way of transfer of this property to Tilray not later than May 1, 2023. The Waiver and Amendment Agreement also provides for the possibility of an additional cash payment of up to US$10 million by HEXO to Tilray in consideration for the termination of the Services Agreement between the parties, but this additional payment would only be payable in the event HEXO generates a sufficient amount of unrestricted cash from any asset sales or financing of HEXO permitted by Tilray after the signature of the Waiver and Amendment and prior to closing, and subject to the satisfaction of certain other conditions described in the Waiver and Amendment Agreement.