SugarBud Craft Growers (TSXV:SUGR)
Historical Stock Chart
1 Year : From Dec 2018 to Dec 2019
TSX-Venture Exchange: SUGR, SUGR.WT
CALGARY, June 5, 2019 /CNW/ - SugarBud Craft Growers Corp. ("SugarBud" or the "Company") announces that its subsidiary, 1800905 Alberta Ltd., as borrower, has entered into a secured non-dilutive credit facility with Pillar Capital Corp. ("Pillar") for up to CDN $5,000,000 (the "Credit Facility").
The proceeds of the Credit Facility will be used by SugarBud to support working capital requirements and to continue to equip Phase 1 of its 29,800 square foot Stavely, Alberta indoor cannabis cultivation facility ("Phase 1 Stavely Facility"). The Phase 1 Stavely Facility is expected to be capable of approximately 13,926,000 to 16,384,000 grams of annual dried cannabis production per year once fully equipped and operational.
Craig Kolochuk, SugarBud's President and Chief Executive Officer stated: "This non-dilutive credit facility allows us to continue the diligent execution of our business plan prior to the receipt of our cultivation license from Health Canada, which we view as a major milestone and catalyst. We expect to obtain our cultivation license imminently, as we received confirmation of readiness from Health Canada on April 18, 2019 and we submitted our affirmation of readiness package prior thereto."
It is SugarBud's intention to replace this Credit Facility with a larger credit facility from another senior financial institution (the "Senior Facility") upon receipt of SugarBud's cultivation license from Health Canada. SugarBud is currently in negotiations with a leading credit union based in Alberta (the "Credit Union") regarding the Senior Facility. It is expected that the Senior Facility will either be held by the Credit Union alone, or in a syndicate led by the Credit Union.
The Credit Facility is guaranteed by SugarBud and its wholly owned subsidiary Trichome Holdings Corp. The first $2 million of the Credit Facility is available for drawdown at SugarBud's discretion, with draws thereafter subject to approval by Pillar. The Credit Facility bears interest at 12.5% per annum, calculated monthly on the daily balance outstanding. In connection with the Credit Facility, SugarBud will issue 1,000,000 common share purchase warrants to Pillar. Each warrant will entitle Pillar to purchase one common share of SugarBud at a price of $0.16 for a period of five years. The warrants will be subject to a four month hold period.
The Credit Facility and the issuance of warrants to Pillar are subject to final approval of the TSX Venture Exchange.
The Company also announces that it has cancelled, at its discretion, the previously announced equity facility with Alumina Partners LLC. SugarBud would like to thank Alumina Partners LLC for their support through the Company's growth to date.
SugarBud is an Alberta-based emerging cannabis company engaged in the development, acquisition, production and distribution of cannabis in Canada.
Forward Looking and Cautionary Statements
This news release may include forward-looking statements including opinions, assumptions, estimates, the Company's assessment of future plans and operations, and, more particularly, statements concerning the Credit Facility, the receipt of its cultivation license from Health Canada and the issuance of common share purchase warrants to Pillar. When used in this document, the words "will," "anticipate," "believe," "estimate," "expect," "intent," "may," "project," "should," and similar expressions are intended to be among the statements that identify forward-looking statements. The forward-looking statements are founded on the basis of expectations and assumptions made by the Company that include, but are not limited to, the timely receipt of all required regulatory and third-party approvals, including TSXV approval. Forward-looking statements are subject to a wide range of risks and uncertainties, and although the Company believes that the expectations represented by such forward-looking statements are reasonable, there can be no assurance that such expectations will be realized. Any number of important factors could cause actual results to differ materially from those in the forward-looking statements including, but not limited to: regulatory and third party approvals not being obtained in the manner or timing anticipated; the ability to implement corporate strategies; the state of domestic capital markets; the ability to obtain financing; changes in general market conditions; industry conditions and events; and other factors more fully described from time to time in the reports and filings made by the Company with securities regulatory authorities. Please refer to the Company's annual information form ("AIF") for the year ended December 31, 2017 and management's discussion and analysis ("MD&A") for the three months ended March 31, 2019 for additional risk factors relating to the Company. The AIF and MD&A can be accessed under the Company's profile on www.sedar.com.
Except as required by applicable laws, the Company does not undertake any obligation to publicly update or revise any forward-looking statements.
Neither the TSXV nor its regulation services provider (as that term is defined in the policies of the TSXV) accepts responsibility for the adequacy or accuracy of this release
SOURCE SugarBud Craft Growers Corp.