Pathway Health (TSX-V:PHC) Corp announced that it has issued a secured promissory grid note to Avonlea-Drewry Holdings Inc for proceeds of up to C$1 million.
The loan is secured against Pathway’s assets and shares of its subsidiaries, and is supported by a secured guarantee of the company's wholly owned subsidiary, Pathway Health (TSX-V:PHC) Services Corp.
Pathway can draw on the loan from time to time during its 90-day term, the company said, adding that any amounts outstanding under the bridge note shall bear interest of 15% per year, payable with any outstanding principal at the end of the term.
READ: Pathway Health reports 1Q revenue of C$2.5M despite pandemic restrictions
The loan will be used for working capital purposes as the company seeks additional sources of funding, which may include the future issuance of other debt or equity securities, according to a statement. This could include a long-term credit facility.
The note is not subject to any interest, fees or bonuses.
Pathway also noted that chairman Michael Steele and Alison Wright, a director, are directors, officers and shareholders of Avonlea-Drewry Holdings, making the loan a related party transaction. The loan was approved by the remaining members of the board of directors.
Pathway Health is an integrated healthcare company that provides products and services to patients suffering from chronic pain and related conditions.
The company owns and operates nine community-based clinics across four provinces, where its team of health professionals works together to help patients through a variety of evidence-based approaches and products, including medical cannabis.
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