BROKERED PRIVATE PLACEMENT OFFERING OF
$11,000,000 IN COMMON SHARES PLUS
$11,000,000 TERM LOAN
FACILITY
CALGARY,
AB and LONDON, ON, Feb. 16,
2021 /CNW/ - Sundial Growers Inc. ("Sundial")
(NASDAQ: SNDL), a Canadian licensed producer of
recreational cannabis and Indiva Limited ("Indiva")
(TSXV: NDVA) (OTCQX: NDVAF), a leading Canadian producer of
cannabis edibles, are pleased to announce a $22,000,000 strategic investment (the
"Investment") into Indiva by Sundial.
The Investment will be completed in the form of a brokered
private placement (the "Placement") led by ATB Capital
Markets Inc. ("ATB" or the "Agent") of 25,000,000
common shares of Indiva (the "Common Shares") at a price of
$0.44 per Common Share, to raise
gross proceeds of $11,000,000, and a
non-revolving term loan facility to Indiva in the principal amount
of $11,000,000 (the "Term
Loan"). It is anticipated that Sundial will be the sole
subscriber in the Placement. Proceeds to Indiva, net of fees,
commissions and expenses are expected to be approximately
$20.9 million.
"Sundial is pleased to support the development of Indiva's
high-quality products," said Zach
George, Chief Executive Officer of Sundial. "This
transaction broadens our exposure to the rapidly expanding cannabis
edibles category."
Indiva intends to use the net proceeds of the Placement and Term
Loan to retire its outstanding debt in full, which includes its
demand loan and promissory note, as well as for working capital and
other general corporate purposes.
"We are delighted to welcome Sundial as a strategic investor in
Indiva," said Niel Marotta,
President and Chief Executive Officer of Indiva. "The capital from
this $22 million investment
significantly improves Indiva's balance sheet, expands our working
capital, and provides the resources necessary to support strong
growth in our business. Indiva will now have the ability to
make additional capital investments, primarily into automation,
which will drive higher throughput and profitability, while
ensuring our product quality maintains the best-in-class standard
our customers and clients depend upon. Indiva's bolstered
financial strength will ensure we can defend our market share
position as a top edibles producer in Canada, and continue to bring new and
innovative cannabis products to of-age Canadians."
Sundial and Indiva intend to complete the Investment on or about
February 23, 2021, subject to certain
conditions customary for transactions of this nature, including,
but not limited to, the receipt of all necessary approvals,
including the approval of the TSX Venture Exchange.
The securities issued under the Placement will be subject to a
statutory hold period of four months and one day following the
closing of the Placement.
Indiva has agreed to: (a) pay to ATB a cash commission equal to
3.0% of the aggregate gross proceeds received by Indiva from the
Placement from Sundial and 6.0% of the aggregate gross proceeds
received by Indiva from the Placement from subscribers other than
Sundial, if applicable; and (b) pay to the Agent a cash commission
equal to 2.0% of the total loan commitment under the Term Loan.
Early Warning
Immediately prior to the Placement, Sundial and its affiliates
held no Common Shares. Upon the closing of the Placement it is
anticipated that Sundial and its affiliates will exercise control
and direction over 18.45% of the issued and outstanding Common
Shares. Sundial and its affiliates do not currently own any
convertible securities of Indiva. The Common Shares are being
acquired for investment purposes and, as of the date of this news
release, Sundial and its affiliates have no current intention to
acquire control or direction over additional securities of Indiva
above 19.9% of the issued and outstanding Common Shares, either
alone or together with any joint actors.
The securities to be offered pursuant to the Placement have not
been, and will not be, registered under the U.S. Securities Act of
1933, as amended (the "U.S. Securities Act") or any U.S.
state securities laws, and may not be offered or sold in
the United States or to, or for
the account or benefit of, United
States persons absent registration or any applicable
exemption from the registration requirements of the U.S. Securities
Act and applicable U.S. state securities laws. This news release
shall not constitute an offer to sell or the solicitation of an
offer to buy securities in the United
States, nor shall there be any sale of these securities in
any jurisdiction in which such offer, solicitation or sale would be
unlawful.
ABOUT SUNDIAL GROWERS INC.
Sundial is a public company with common shares traded on Nasdaq
under the symbol "SNDL".Sundial is a licensed producer that crafts
cannabis using state-of-the-art indoor facilities. Our
'craft-at-scale modular growing approach, award-winning genetics
and experienced master growers set us apart. Our
Canadian operations cultivate small-batch cannabis using an
individualized "room" approach, with 448,000 square feet
of total space. Sundial's brand portfolio
includes Top Leaf, Sundial Cannabis, Palmetto and Grasslands.
Our consumer-packaged goods experience enables us to not just
grow quality cannabis, but also to create exceptional consumer and
customer experiences. We are proudly Albertan, headquartered in
Calgary, AB, with operations
in Olds, AB, and Rocky View County, AB. For more information on
Sundial, please go to www.sndlgroup.com.
Related Links:
www.sundialgrowers.com
ABOUT INDIVA LIMITED
Indiva sets the standard for quality and innovation in cannabis.
As a Canadian licensed producer, Indiva creates premium pre-rolls,
flower, capsules, and edible products and provides production and
manufacturing services to peer entities. In Canada, Indiva produces and distributes the
award-winning Bhang® Chocolate, Wana™ Sour Gummies,
Ruby® Cannabis Sugar, Sapphire™ Cannabis Salt, Artisan Batch, and
other Powered by INDIVA™ products through license agreements
and partnerships. Click here to connect with Indiva on LinkedIn,
Instagram, Twitter and Facebook, and here to find more information
on the Company and its products.
DISCLAIMER AND READER ADVISORY
Neither the TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in the policies of the TSX
Venture Exchange) has in any way passed upon the merits of the
contents of this press release and neither of the foregoing
entities accepts responsibility for the adequacy or accuracy of
this release or has in any way approved or disapproved of the
contents of this press release.
Certain statements contained in this press release constitute
forward-looking information. These statements relate to future
events or future performance. The use of any of the words "could",
"intend", "expect", "believe", "will", "projected", "estimated" and
similar expressions and statements relating to matters that are not
historical facts are intended to identify forward-looking
information and are based on the parties' current belief or
assumptions as to the outcome and timing of such future events.
Actual future results may differ materially. In particular, this
release contains forward-looking information relating to the
Company's ability to complete the Placement and the Term Loan, the
receipt of all approvals, consents and other matters beyond the
Company's control and the use of proceeds. Various assumptions or
factors are typically applied in drawing conclusions or making the
forecasts or projections set out in forward-looking information.
Those assumptions and factors are based on information currently
available to the parties. The material factors and assumptions
include the parties being able to negotiate and enter into
definitive documents with respect to the Placement and the Term
Loan, the receipt of regulatory approval and third party consents,
the ability of Indiva to satisfy its existing debt obligations with
the proceeds of the Placement and Term Loan and other risks
associated with regulated entities in the cannabis
industry.
The forward-looking information contained in this release is
made as of the date hereof and the parties are not obligated to
update or revise any forward-looking information, whether as a
result of new information, future events or otherwise, except as
required by applicable securities laws. Because of the risks,
uncertainties and assumptions contained herein, investors should
not place undue reliance on forward looking information. The
foregoing statements expressly qualify any forward-looking
information contained herein.
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SOURCE Sundial Growers Inc.