DAVIDsTEA Provides Update on Filing of Q1 Financial Statements
July 20 2020 - 4:30PM
DAVIDsTEA Inc. (Nasdaq:DTEA) (“DAVIDsTEA” or the “Company”), a
leading tea merchant in North America, announced on
June 5, 2020 that it is availing itself of the 45-day blanket
extension granted by the Canadian securities regulatory authorities
for the filing of financial statements and management’s discussion
and analysis for its first quarter ended May 2, 2020. As
previously announced, DAVIDsTEA intends to file the first quarter
financial statements and related documents no later than
July 31, 2020.
As required by the Canadian blanket order,
DAVIDsTEA confirms that since June 5, 2020, the only material
business developments are as set out in the Company’s:
(A) material change report filed on SEDAR on July 14,
2020, reporting that: (i) the Company obtained an Initial
Order on July 8, 2020 pursuant to the Companies’ Creditors
Arrangement Act (Canada) (the “CCAA”) from the Québec Superior
Court in order to implement a restructuring plan, which Initial
Order provides, among other things, for the appointment of PwC as
Monitor in the CCAA proceedings; (ii) on July 9, 2020, the
United States Bankruptcy Court for the District of Delaware entered
an order in favour of DAVIDsTEA and DAVIDsTEA (USA) Inc., its
wholly-owned U.S. subsidiary, under Chapter 15 of the United
States Bankruptcy Code, provisionally recognizing the
proceedings under the CCAA and enforcing the initial order issued
by the Québec Superior Court, in effect providing protection to
DAVIDsTEA and DAVIDsTEA (USA) Inc. from creditor action against
their assets in the United States; (iii) further to obtaining
the Initial Order, the Company sent notices to terminate leases for
82 of its retail stores in Canada and all 42 of its retail stores
in the United States, which lease terminations will take effect
30 days from the deemed date of receipt; (iv) with
regards to DAVIDsTEA’s brick and mortar network in Canada,
negotiations with landlords for the remaining 100 stores have
started, although at this time the outcome of such discussions
remains uncertain; and (v) to the extent DAVIDsTEA cannot
reach agreements with the landlords on more favourable lease terms,
DAVIDsTEA may terminate the leases and permanently close additional
stores; and (B) press release issued on July 16, 2020,
reporting that the Québec Superior Court issued an Amended and
Restated Initial Order extending to September 17, 2020 the
application of the Initial Order obtained on July 8, 2020, and
dealing with certain administrative matters.
Cautionary Forward-Looking
Statements
This press release includes statements that
express our opinions, expectations, beliefs, plans or assumptions
regarding future events or future results and there are, or may be
deemed to be, “forward-looking statements” within the meaning of
the Private Securities Litigation Reform Act of 1995 (the “Act”).
The following cautionary statements are being made pursuant to the
provisions of the Act and with the intention of obtaining the
benefits of the “safe harbor” provisions of the Act. These
forward-looking statements can generally be identified by the use
of forward-looking terminology, including the terms “believes”,
“expects”, “may”, “will”, “should”, “approximately”, “intends”,
“plans”, “estimates” or “anticipates” or, in each case, their
negatives or other variations or comparable terminology. These
forward-looking statements include all matters that are not
historical facts and include statements regarding our intentions,
beliefs or current expectations concerning, among other things, our
restructuring process, the COVID-19 pandemic, our strategy of
transitioning to e-commerce and wholesale sales, future sales
through our e-commerce and wholesale channels, the closing of
certain of our retail stores, future lease liabilities, our results
of operations, financial condition, liquidity and prospects, the
impact of the COVID-19 pandemic on the global macroeconomic
environment, and our ability to avoid the delisting of the
Company’s common stock by Nasdaq due to the restructuring or our
inability to maintain compliance with Nasdaq listing
requirements.
While we believe these opinions and expectations
are based on reasonable assumptions, such forward-looking
statements are inherently subject to risks, uncertainties and
assumptions about us, including the risk factors set forth in our
annual report on Form 10-K for the fiscal year ended
February 1, 2020, filed with the United States Securities and
Exchange Commission and with the Autorité des marchés
financiers.
About DAVIDsTEA
DAVIDsTEA is a leading online retailer and
growing mass wholesaler of specialty tea, offering a differentiated
selection of proprietary loose-leaf teas, pre-packaged teas, tea
sachets and tea-related gifts and accessories through over 100
company-owned and operated retail stores in Canada, as well as its
e-commerce platform at www.davidstea.com. A selection of DAVIDsTEA
products is also available in over 2,500 grocery stores and
pharmacies across Canada. The Company is headquartered in Montréal,
Canada.
Investor Contact |
Media Contact |
MaisonBrison Communications |
PELICAN PR |
Pierre Boucher |
Lyla Radmanovich |
514-731-0000 |
514-845-8763 |
investors@davidstea.com |
media@rppelican.ca |
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