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# Tilray Gets A Covenant Holiday On Its Bank Debt, But The $15 Million Revolver Is Off Limits
- URL: https://www.bullished.co/tilray-gets-a-covenant-holiday-on-its-bank-debt-but-the-15-million-revolver-is-off-limits-944c4a96/
- Published: 2026-10-08T23:16:06.000Z
- Updated: 2026-10-08T23:16:06.000Z
- Description: A Seventh Amendment skips the lender test for the August quarter, and $52.0 million of convertible notes still mature June 15, 2027.
- Author: Matteo Parrino
- Tags: SEC Filings, TLRY, Industry: Healthcare

[Tilray Brands](https://www.bullished.co/tag/tlry/) signed a Seventh Amendment to its credit agreement on October 7 that [skips financial covenant testing](https://www.sec.gov/Archives/edgar/data/0001731348/000143774926032382/tlry20260831%5F10q.htm?ref=bullished.co) for the quarter ended August 31, 2026, and the 10-Q filed Thursday says the company cannot draw on its $15 million revolver until testing resumes. The same filing shows operating cash flow of negative $16.5 million and $52.0 million of convertible notes left to deal with before June 2027.

## What the amendment does

The amendment, signed by American Beverage Crafts Group, a Tilray subsidiary, with Bank of America as administrative agent, also revises certain covenants for later periods. A new risk factor names the leverage ratio, minimum EBITDA and minimum liquidity among them.

The filing warns that the amendment "does not assure our compliance" with the covenants in future periods. A missed test without a waiver could let lenders cancel their commitments, accelerate repayment, add default interest and go after collateral.

The revolver has already shrunk. The [Q3 FY2026 10-Q](https://www.sec.gov/Archives/edgar/data/0001731348/000143774926010907/tlry20260228%5F10q.htm?ref=bullished.co) described a $25 million revolver. A Sixth Amendment signed July 24, 2026 cut it to $15 million. Nothing was drawn at August 31.

## Cash burn and the convertible notes

Net cash used in operations was $16.5 million, against $1.3 million a year earlier. Inventory rose $27.8 million. Accounts payable rose $20.4 million, which the filing mostly ties to higher BrewDog trade payables from better supplier credit terms and payment timing.

The TLRY 27 Notes carried $64.0 million of principal at quarter-end, down from $88.0 million at May 31\. Tilray issued 5,229,861 shares to retire $24.0 million of them in the quarter. Three more exchanges in September issued 2,841,650 shares for $12.0 million, leaving $52.0 million outstanding as of the October 8 filing.

The notes' carrying value of $59.2 million is now a current liability, ahead of the June 15, 2027 maturity. The company says it is weighing alternatives, including exchanges before maturity.

## Shares and losses

Tilray also sold 4,645,344 shares through its at-the-market program for $22.9 million gross. Shares outstanding reached 144,936,074, from 131,683,075 at May 31, 2026\. The net loss was [$0.32 per share](https://finance.yahoo.com/markets/stocks/articles/tilray-brands-inc-tlry-reports-111002725.html?.tsrc=rss&ref=bullished.co).

Non-operating expense was $7.8 million, driven by an $11.2 million foreign exchange loss, versus $3.8 million of income a year earlier. The company reported [a net loss of $40.0 million](https://www.marketwatch.com/story/tilray-swings-to-1q-loss-but-revenue-climbs-on-beverage-growth-fe96c02f?ref=bullished.co) against net income of $1.5 million a year ago.

The filing does not say when covenant testing resumes. The next quarter ends November 30, 2026, and the notes mature June 15, 2027.

### Sources

- [10-Q Filing — Tilray Brands (TLRY)](https://www.sec.gov/Archives/edgar/data/0001731348/000143774926032382/tlry20260831%5F10q.htm?ref=bullished.co) — SEC EDGAR
- [10-Q Filing — Tilray Brands (TLRY), Q3 FY2026 filed 2026-04-01 (comparison basis)](https://www.sec.gov/Archives/edgar/data/0001731348/000143774926010907/tlry20260228%5F10q.htm?ref=bullished.co) — SEC EDGAR
- [10-K Filing — Tilray Brands (TLRY), filed 2026-07-28 (earlier disclosure)](https://www.sec.gov/Archives/edgar/data/0001731348/000143774926024698/tlry20260531%5F10k.htm?ref=bullished.co) — SEC EDGAR
- [Tilray Brands Delivers Record Q1 Fiscal 2027 Revenue and Record Q1 Gross Profit, Demonstrating the Power of Its Global Platform, Driven by Double-Digit Year-Over-Year Growth Across International Cannabis, Beverage and Pharmaceutical Distribution | Financial Post](https://financialpost.com/globe-newswire/tilray-brands-delivers-record-q1-fiscal-2027-revenue-and-record-q1-gross-profit-demonstrating-the-power-of-its-global-platform-driven-by-double-digit-year-over-year-growth-across-international-canna?ref=bullished.co) — financialpost.com
- [Tilray Swings to 1Q Loss, but Revenue Climbs on Beverage Growth](https://www.marketwatch.com/story/tilray-swings-to-1q-loss-but-revenue-climbs-on-beverage-growth-fe96c02f?ref=bullished.co) — MarketWatch
- [Tilray Brands Not Dependent on Single Market, CEO Highlights Multiple Growth Engines](https://www.benzinga.com/markets/earnings/26/10/62248545/tilray-brands-not-dependent-on-single-market-ceo-highlights-multiple-growth-engines?ref=bullished.co) — benzinga.com
- [Earnings Snapshot: Tilray tops Q1 EPS expectations, reaffirms FY27 outlook | Seeking Alpha](https://seekingalpha.com/news/4651295-earnings-snapshot-tilray-tops-q1-eps-expectations-reaffirms-fy27-outlook-as-international-cannabis-and-beverage-growth-accelerate?ref=bullished.co) — seekingalpha.com
- [Tilray Brands, Inc. (TLRY) Reports Q1 Loss, Misses Revenue Estimates](https://finance.yahoo.com/markets/stocks/articles/tilray-brands-inc-tlry-reports-111002725.html?.tsrc=rss&ref=bullished.co) — Yahoo Finance

### More on Tilray Brands

- [Tilray CEO Says Market Misprices It As A Pure Cannabis Stock, Offers Three Scenarios](https://www.bullished.co/tilray-ceo-says-market-misprices-it-as-a-pure-cannabis-stock-offers-three-scenarios-8d592888/)
- [Tilray's Beer Business Now Brings In $101.5 Million A Quarter While Cannabis Sales Fall To $56.1 Million](https://www.bullished.co/tilrays-beer-business-now-brings-in-101-5-million-a-quarter-while-cannabis-sales-fall-to-152f5b36/)

[All Tilray Brands (TLRY) coverage →](https://www.bullished.co/tag/tlry/)