GTEC Holdings (GTEC.V) has repaid two senior secured promissory notes with NFS Leasing Canada as of April 9, 2021. Combined, both notes carried an aggregate principal balance of approximately $6 million.
“We would like to thank the team at NFS for supporting our vision as we navigated through a key phase of the growth of our emerging business…We are extremely pleased to become one of the few debt free Companies within the sector, as we continue on our mission to become a leading producer of high-quality cannabis products in North America and globally,” said Norton Singhavon, Founder and CEO at GTEC.
Previously, GTEC repaid a promissory note established with Invictus MD Strategies, a global cannabis company, announced on March 1, 2021. The note carried a principal balance of approximately $2 million which carried an annual interest rate of 10%. The complete elimination of the Company’s debt will deliver over $1 million in interest savings over the next 12-months. If GTEC were a person, they would be the kind of friend who actually pays you back when you spot their bill at the pub.
GTEC now has the freedom and flexibility to frolic in the fields of a debt-free paradise. Unintended alliteration aside, the Company is no longer shackled by interest payments meaning its assets are entirely unencumbered. Additionally, GTEC’s repayment of debts means the Company’s overall working capital has improved with a current cash balance of approximately $19 million.
The closing of GTEC’s most recent public offering, announced March 30, 2021, assisted the Company in repaying its debts. GTEC issued a total of 28,750,000 units at C$0.80 per unit which generated proceeds of C$23,000,000. At the time, the Company had stated that gross proceeds would be used to repay its debts in addition to funding development and international expansion.
With this in mind, GTEC recently entered the global cannabis market. On March 8, 2021, the Company announced the signing of an export deal with Focus Medical Herbs, an Israeli medical cannabis company. According to the established multi-year agreement, GTEC will export a minimum of 500kg of cannabis annually to Israel. GTEC will serve as Focus Medical’s key supplier providing premium cannabis flower to a highly profitable market.
Having paid off its debts, GTEC is now one of the few companies in the sector that is debt-free. With a strong working capital position, the Company can now focus wholeheartedly on improving its global presence while solidifying its reputation as a producer of premium cannabis in Canada. GTEC has grown considerably in the new year, however, continued growth will depend on the Company’s plans for the future which have not yet been discussed in detail.
GTEC’s share price opened at $0.78 and reached a high of $0.80 shortly after. The Company’s share price has since dropped to $0.77.