The following table sets forth the net carrying amount of the convertible debentures:

TLRY 27

The TLRY 27 convertible debentures were issued on   May 30, 2023 and on  June 9, 2023, by way of overallotment, in the principal amount of $172,500 (the “TLRY 27 Notes”). The TLRY 27 Notes bear interest at a rate of 5.20% per annum, payable semi-annually in arrears on   June 15 and   December 15 of each year, and mature on   June 15, 2027, unless earlier converted. The TLRY 27 Notes are Tilray’s general unsecured obligations and rank senior in right of payment to all of Tilray’s indebtedness that is expressly subordinated in right of payment to the notes; equal in right of payment with any of Tilray’s unsecured indebtedness that is not so subordinated, effectively junior in right of payment to any of Tilray’s secured indebtedness to the extent of the value of the assets securing such indebtedness; and structurally junior to all indebtedness and other liabilities (including trade payables but excluding intercompany obligations) of Tilray’s current or future subsidiaries. Noteholders have the right to convert their TLRY 27 Notes into shares of Tilray’s Common Stock at their option, at any time, until the close of business on the second scheduled trading day immediately before   June 15, 2027. The initial conversion rate is 376.6478 shares per $1,000 principal amount of TLRY 27 Notes, which represents a conversion price of approximately $2.66 per share. The conversion rate and conversion price will be subject to adjustment upon the occurrence of certain events.

The TLRY 27 Notes will be redeemable, in whole and not in part, at Tilray’s option at any time on or after June 20, 2025 at a cash redemption price equal to the principal amount of the notes to be redeemed, plus accrued and unpaid interest, if any, to, but excluding, the redemption date, but only if the last reported sale price of Tilray’s Common Stock exceeds 130% of the conversion price for a specified period of time. If certain corporate events that constitute a fundamental change occur, then, subject to a limited exception, noteholders   may require Tilray to repurchase their TLRY 27 Notes for cash. The repurchase price will be equal to the principal amount of the notes to be repurchased, plus accrued and unpaid interest, if any, to, but excluding, the applicable repurchase date. In connection with the Company’s offering of the TLRY 27 Notes, the Company entered into a share lending agreement with an affiliate of Jefferies LLC (the “Share Borrower”), pursuant to which it lent to the Share Borrower 38,500,000 shares of the Company’s Common Stock (the “Borrowed Shares”). The Borrowed Shares were newly-issued shares, will be held as treasury shares until the expiration or early termination of the share lending agreement and  may be used by purchasers of the TLRY 27 Notes to sell up to 38,500,000 shares of the Company’s Common Stock. The fair value of the share lending agreement has been recorded as part of the unamortized discount on the debenture. The Company expects that the selling stockholders will use their position created by such sales to establish their initial hedge with respect to their investments in the TLRY 27 Notes. The Company did not receive any proceeds from the sale of the Borrowed Shares. 

During the fiscal year ended May 31, 2025, the Company exchanged an aggregate $67,500 of its TLRY 27 Notes for cancellation, by issuing 71,755,054 shares of Common Stock and paying $9,335 in cash to settle accrued interest. Upon exchanging the TLRY 27 Notes, a portion of the settlement consideration was allocated to the equity component of the instrument and was recognized as a $19,028 reduction of additional paid-in capital in the Consolidated Statements of Stockholders’ Equity. Additionally, this repurchase resulted in a gain of $5,792 which was recorded in other non-operating (losses) gains, net as shown in Note 27 (Non-operating income (expense)). Following consummation of the exchange, the number of outstanding Borrowed Shares of Common Stock was reduced by 15,065,217 shares which were then returned as Treasury Stock. As of   May 31, 2025 and  May 31, 2024, a total of 24,343,783 and 38,500,000 shares remained outstanding under the share lending arrangement, respectively. 

During the fiscal year ended   May 31, 2025, the Company recognized interest expense of $7,775 and accretion of amortized discount interest of $10,863. For the same periods in the prior year Company recognized interest expense of $8,970 and accretion of amortized discount interest of $11,516.

As of May 31, 2025, there was $105,000 principal outstanding compared to $172,500 principal outstanding as of  May 31, 2024 under the TLRY 27 Notes. See Note 31 (Subsequent events) for additional transactions. 

APHA 24

The APHA 24 convertible debentures were entered into in  April 2019, in the principal amount of $350,000, bore interest at a rate of 5.25% per annum, and were payable semi-annually in arrears on  June 1 and  December 1 of each year, and matured on  June 1, 2024 (the “APHA 24 Notes”). On  June 1, 2024, the Company repaid the remaining principal of the APHA 24 Notes in cash upon maturity.