Mr. Nicholas Sosiak reports

CANARA BIOTECH INC. SECURES AN ADDITIONAL $10 MILLION IN NON-DILUTIVE CAPITAL WITH ITS LEAD CREDIT PROVIDER, BMO COMMERCIAL BANKING

Cannara Biotech Inc. has raised an additional $10-million of credit facilities from its lead bank, BMO Commercial Banking, through a $5-million increase in its term loan facility and a $5-million increase in its revolving line of credit. Under the terms of the initial agreement that was announced on June 1, 2022, the credit facility included a three-year term loan for $45-million with an accordion for up to an additional $10-million and a $5-million line of credit. Other favourable terms as part of the original deal included a declining interest rate over time as the company hits certain covenant thresholds and the ability to repay the facility without penalty at any time.

The new term loan proceeds will be used to finance the completion of the construction of a 44,950-square-foot building adjacent to the Valleyfield megafacility, in an unlicensed area which has been preleased to a new non-cannabis tenant, creating an accretive real estate asset with incremental future cash flows. The additional amounts available under the expanded credit line will provide flexibility in working capital during this high growth stage of Cannara's development.

"An opportunity to maximize one of our assets currently not in use that will generate additional cash flow from a reputable tenant made this an easy decision," stated Nicholas Sosiak, chief financial officer of Cannara. "We are pleased to secure this non-dilutive capital and appreciate the continued support from our tremendous partner, BMO Commercial Banking. This capital expenditure will generate long-term returns for Cannara while simultaneously increasing the value of our asset base. As we continue to mature as a company, and as the economic landscape continues to remain volatile, flexibility is of utmost importance to us and the enhanced working capital position will allow us to move forward on our immediate and mid-term growth objectives without interruption as we remain committed to our goal of becoming the preferred cannabis producer in Canada," concluded Mr. Sosiak.

About Cannara Biotech Inc.

Cannara Biotech is a vertically integrated producer of affordable premium-grade cannabis and cannabis-derivative products for the Quebec and Canadian markets.

We seek Safe Harbor.