Early Retirement of Debt Facilities /NOT FOR DISSEMINATION INTHE UNITED STATESOR FOR DISTRIBUTION TO UNITED STATES WIRE SERVICES/
TORONTO, Oct. 25, 2021 /CNW/ - Fire & Flower Holdings Corp. ("Fire & Flower" or the "Company") (TSX: FAF) (OTCQX: FFLWF), a leading, technology-powered, adult-use cannabis retailer, today announced that it has repaid in full its obligations under its previously announced secured debt facilties provided by ATB Financial ("ATB").
As announced on April 21, 2020, ATB extended two separate loan facilities to Fire & Flower on a two-year term: a revolving credit facility in the amount of $5 million, and a term loan in the amount of $5 million (collectively, the "Facilities"). Prior to repayment of the Facilities, the Company had $2.3 million outstanding under the term loan facility and had not drawn on the revolving credit facility, and maintained $3.9M in restricted cash in collateral and reserve accounts held by ATB as security for repayment of interest, fees and principal. The outstanding debt was repaid from cash held in a restricted collateral account, and the net cash in those accounts may be redeployed by the Company for its near-term growth and investment activities.
The Company was permitted to repay amounts outstanding under the Facilities prior to maturity without penalty. The repayment allows the Company to avoid additional interest charges and fees payable over the remainder of the term.
Following its early repayment of the Facilities, the Company's sole long-term debt obligations are approximately $2.4M principal amount of 8% unsecured convertible debentures outstanding to 2707031 Ontario Inc., a wholly-owned indirect subsidiary of Alimentation Couche-Tard Inc., which mature on June 30, 2023. As previously announced on March 2, 2021, Fire & Flower exercised its right to convert $23.6M principal amount of 8% unsecured convertible debentures then-outstanding to 2707031 Ontario Inc.
Trevor Fencott, Chief Executive Officer of Fire & Flower, commented, "Our ability to fully repay our bank debt six months early signifies the strength of our evolving asset-light business strategy, as well as, our unique opportunity to advance a number of near and long-term growth opporuntunities that focus on our competitive data-driven cannabis retail technology. With almost no debt on our balance sheet, we are strongly positioned to enter the next stage of our operational growth with our key industry partnerships in order to build our global leadership position as today's most advanced technology-based cannabis retailer."