Fireplace & Flower Completes Purchased Deal Financing
EDMONTON, June 26, 2019 /CNW/ – Fireplace & Flower Holdings Corp. (“Fireplace & Flower” or the “Firm”) (TSXV: FAF), at present introduced the closing of its beforehand introduced purchased deal non-public placement (the “Personal Placement”) of 27,188 convertible debenture items (the “Models”) at a value of $1,000 per Unit for combination gross proceeds of $27,188,000. Every Unit is comprised of 1 $1,000 principal quantity unsecured convertible debenture (a “Convertible Debenture”) and 278 frequent share buy warrants (every, a “Warrant”). Every Warrant entitles the holder thereof to buy one frequent share within the capital of the Firm (a “Warrant Share”) for a interval of 24 months following the closing of the Personal Placement at an train value of $1.45 per Warrant Share.
With the current re-opening of cannabis retail licensing in Alberta, having the ability to speed up retailer build-outs is vital. Entry to capital is crucial to success in a progress business, and this financing clearly places Fireplace & Flower ready to capitalize on market alternatives as they emerge.
Trevor Fencott, Fireplace & Flower’s Chief Government Officer
The Personal Placement was underwritten by a syndicate of underwriters, led by Eight Capital and GMP Securities L.P. and together with AltaCorp Capital Inc., Canaccord Genuity Corp. and Echelon Wealth Companions Inc. (collectively, the “Underwriters”).
The Convertible Debentures bear curiosity at an annual fee of 8.00% payable in arrears in equal installments semi-annually. The Convertible Debentures mature on June 26, 2020 (the “Maturity Date”). The principal quantity of Convertible Debenture and accrued and unpaid curiosity thereon might be convertible on the holder’s possibility into frequent shares of the Firm (the “Conversion Shares”) at any time previous to the sooner of: (a) the shut of enterprise on the enterprise day instantly previous the Maturity Date; and (b) the date mounted for redemption (as set out within the Debenture Indenture (as outlined beneath)). The conversion value for the principal quantity of Convertible Debentures is $1.20 per Conversion Share. The conversion value for the accrued and unpaid curiosity is the higher of (a) $1.20; and (b) the Market Worth (as outlined within the insurance policies of the TSX Enterprise Trade) on the date of conversion, per Conversion Share. The conversion of the Convertible Debentures is topic to adjustment in sure occasions as described in a debenture indenture dated as of June 26, 2019 entered into between the Firm and Computershare Belief Firm of Canada (the “Debenture Indenture”).
In reference to the Personal Placement, Fireplace & Flower has paid the Underwriters combination money consideration of $1,476,420. As extra consideration, the Underwriters have obtained 1,355,350 compensation choices (“Compensation Choices”) in reference to the Personal Placement. Every Compensation Choice is exercisable for one frequent share of the Firm at a value of $1.20 per share till June 26, 2021.
The web proceeds of the Personal Placement might be used for working capital and basic company functions, together with to develop the Firm’s proprietary Hifyre digital platform.
Sure administrators and officers of the Firm participated within the Personal Placement and bought an combination of 150 Models. Such participation constitutes a related-party transaction below Multilateral Instrument 61-101-Safety of Minority Safety Holders in Particular Transactions (“MI 61-101”). The Firm has relied on exemptions from the formal valuation and minority shareholder approval necessities of MI 61-101 contained in sections 5.5(a) and 5.7(1)(a) of MI 61-101 in respect of associated occasion participation within the Personal Placement as neither the honest market worth (as decided below MI 61-101) of the subject material of, nor the honest market worth of the consideration for, the transaction, insofar because it concerned associated events, exceeded 25% of the Firm’s market capitalization as decided below MI 61-101.
About Fireplace & Flower
Fireplace & Flower is a number one purpose-built, unbiased adult-use cannabis retailer poised to seize important Canadian market share. The Firm guides customers via the advanced world of cannabis via education-focused, best-in-class retailing that’s centered round its proprietary Hifyre digital platform. The Firm’s management group combines in depth expertise within the cannabis business with robust capabilities in retail operations.
Fireplace & Flower Holdings Corp. owns all issued and excellent shares in Fireplace & Flower Inc., a licensed cannabis retailer within the provinces of Alberta and Saskatchewan and is a marketing consultant and licensor to Fireplace & Flower-branded retail places in province of Ontario.
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