CALGARY, AB (December 30, 2020) — Sundial Growers Inc. (Nasdaq: SNDL) (“Sundial” or the “Company”) announced today that it has closed the acquisition of a special purpose vehicle (the “Investment”). Consideration for the Investment, totaling $58.9 million in cash, was funded from Sundial's available cash reserves which totaled $110 million immediately prior to the closing of the Investment. All amounts are denominated in Canadian dollars unless otherwise noted.
The special purpose vehicle owns $58.9 million of aggregate principal amount of senior secured debt (the “Senior Loan”) of Zenabis Investments Ltd. (“Zenabis”), a subsidiary of Zenabis Global Inc. (the “Parent”). The Senior Loan bears interest at a rate of 14% per annum and has a maturity date of March 31, 2025, with principal repayments under certain circumstances over time including $7.0 million payable on December 31, 2020. The Senior Loan is secured by the assets of Zenabis and its subsidiaries and is guaranteed by the Parent. In aggregate the assets represent all the cannabis related assets of Zenabis.
Pursuant to the terms of the Senior Loan, Zenabis will also pay Sundial a royalty (the “Royalty”) based on quarterly sales revenue from its medical, recreational and wholesale cannabis lines net of value added or sales taxes (“Net Cannabis Revenue”), which will be payable each fiscal quarter as follows:
(i) 3.5% of Net Cannabis Revenue where Net Cannabis Revenue does not exceed $25 million;
(ii) 3.0% of Net Cannabis Revenue where Net Cannabis Revenue exceeds $25 million but not $30 million;
(iii) 2.5% of Net Cannabis Revenue where Net Cannabis Revenue exceeds $30 million but not $37.5 million; and
(iv) 2.0% of Net Cannabis Revenue where Net Cannabis Revenue exceeds $37.5 million.
The Royalty is payable for 32 fiscal quarters and is payable for quarters in which Zenabis accomplishes certain Net Cannabis Revenue targets and maintains certain debt service ratios. If those targets are not met, the Royalty is not payable for the applicable fiscal quarter but the term of the Royalty is extended another fiscal quarter.
Sundial has a current unrestricted cash balance of approximately $51 million following the Investment and approximately 919 million common shares outstanding.
Sundial Growers Inc. (NASDAQ: SNDL) ("Sundial") today announced that between September 3, 2021 and October 19, 2021, Sundial disposed of 2,336,500 common shares (“Common Shares”) in the capital of Indiva Limited (TSXV: NDVA) (OTCQX: NDVAF)Read More
Sundial Growers Inc. (NASDAQ: SNDL) (“Sundial” or the “Company”) is pleased to announce today that it has entered into an arrangement agreement (the “Agreement”) with Alcanna Inc. (TSX: CLIQ) (“Alcanna”) pursuant to which Sundial will acquire all of the issued and outstanding common shares of Alcanna (“Alcanna Shares”) by way of a statutory plan of arrangement for total consideration of approximately $346 million (the “Transaction”).Read More
Sundial Growers Inc. (NASDAQ: SNDL) (“Sundial” or the “Company”) announced that it has reacquired (the “Acquisition”) more than 10%Read More