Redfund Capital Corp (CSE:LOAN) (OTC:PNNRF), the cannabis-focused investment firm, told investors Thursday that it will provide financing of about US $1 million to Cannaki Beverage Inc to help fund the beverage company’s expansion.
Under the deal’s terms, Vancouver-based Redfund and Cannaki, which is headquartered in Las Vegas, Nevada, signed a 2-year convertible note this week for $1 million at a yearly interest rate of 14%.
In a statement, Redfund CEO Meris Kott said Redfund would help Cannaki strike a deal with a licensed Canadian cannabis producer and get its CBD beverages on shelves in Canada.
“Cannaki has a strong network in the US, Mexico and Europe and they are planning to expand their products’ reach to Asia and South America,” Kott said. “Welcoming a beverage company with a strong experienced team to the portfolio is very exciting for Redfund and our beverage division.”
Cannaki makes both still and carbonated beverages, as well as Nano CBD-infused flavored water and hemp water.
The two-year note can be converted at Redfund’s discretion at any time during the term. In exchange, Cannaki will grant Redfund warrants in its common stock, equal to 20% of the amount of the note.
Redfund provides debt and equity funding in the mid-to-late stages of a target cannabis company’s development. Its focus is on companies specializing in medical cannabis as well as healthcare and hemp and CBD-related products.
Redfund shares slipped by less than C$0.01 to hit at C$0.15 in Canadian trade on Thursday.
Contact Ellen Kelleher at [email protected]
-- This story is updated to reflect latest share price movement --