Cannasouth issues $100,000 in Secured Convertible Notes

Cannasouth Limited (NZX:CBD) advises that following the launch of the wholesale offer of secured convertible notes (“Notes”) under which CBD issued a total of $1,220,000 of Notes on 31 July 2024, CBD has issued a further $100,000 of Notes on 15 August 2024. Issue Terms CBD has a secured convertible note subscription agreement under which $100,000 of Notes have been issued by CBD on 15 August 2024. The principal terms of the Notes are detailed below. As previously advised, given the structure of the Notes offer, only wholesale investors, eligible investors and close business associates (as defined by the Financial Markets Conduct Act 2013) are entitled to participate in the Notes offer. Principal Terms of Notes The principal terms of the Notes are as follows: 1) The Notes have a term of 24 months. 2) The Noteholders may at their option (subject to paragraph 5 below) either: (a) redeem the Notes for cash at the expiry of the term of the Notes; or (b) convert all or some of the Notes into ordinary CBD shares at an issue price of 3 cents per share at anytime prior to the expiry of the term of the Notes, subject to paragraph 5 below. 3) The Notes bear an interest rate of 10% per annum. 4) The obligations of CBD under the Notes are secured by: (a) an existing General Security Agreement over CBD’s present and after acquired property granted in favour of all of the Noteholders; and (b) a new General Security Agreement over Cannasouth Cultivation Limited’s and Eqalis Pharmaceuticals Limited’s present and after acquired property granted in favour of all of the Noteholders. 5) The exercise of the conversion rights is subject to the Company’s shareholders approving the conversion rights within eighteen (18) months from the date of the convertible note subscription agreement. -ENDS- For further information visit www.cannasouth.co.nz or contact: Garry Whimp Administrator, Blacklock Rose Ltd Email: gwhimp@blr.co.nz Mobile: 021 587 230 Ben Francis Administrator, Blacklock Rose Ltd Email: bfrancis@blr.co.nz Mobile: 021 042 6991