From the CEO site - FYI info and comments see my posts above, and go to PWC's page for Indiva and read the filings. SNDL forced this default, for reasons of their own.
I was also told by IR that NDVA was on a payment plan to both SNDL and CRA, and was current on all payments. But SNDL put the condition on the amended loan that CRA had to be paid in full by end of May, regardless of payment plan (which CRA is typically fine with).
Buried in the 2023 full-year financials, under the SNDL loan section, is that just shy of $5M must be paid back in full by that date, or the lender can (at its discretion) declare a breach of that covenant.
Doesn't identify CRA as the party owed, anywhere I can find.
NDVA April press release on the amended promissory notes said "shall work to reduce other current liabilities in the near term"
you'd know they could be forced into default if you caught that one line in the financials for year end
and SNDL had discretion; they could extend if they wanted to. Why do they care if CRA is paid in full if payments for tax arrears are being made and current? They did the two week extension into June and then refused to extend further.
SNDL obviously has their own reasons to force a business with rising revenue trend into technical default. I assume they wanted to take over and preferred to do it this way, rather than make a bid (costing them additional).
right now, they are the debtor-in-possession and are the lender to keep the operation running through CCAA process, collecting and 18% on up to $2.4M (same rate they were collecting on their loan - 15% plus another 3% for being in default).
So they're collecting 18% a year, payments aren't being missed, the company is guiding to record revenues for 2024, and they decided to force the default, for their own reasons.
did anyone know NDVA owed taxes in arrears to CRA, and was on a payment plan? I didn't.
traded a few emails with IR on Friday and now they've gone silent with me, so the info I got there plus reviewing CCAA documents and revisiting previous press releases and financials is what I know.
you can draw your own conclusions. I didn't catch the red flag on SNDL's loan in the financials, and honestly wouldn't have expected them to enforce it if I did - they were getting a nice return on their investment and would continue to for a long time if the company succeeded.
So for SNDL - NDVA had to come up with $5M and couldn't, so they called their loan. They could explain their rationale there (except IR for SNDL hasn't responded to me either)
CCAA filings from the Monitor agree with a rising revenue trend, which is why under CCAA they are doing a reorg and looking for bidders (with SNDL's stalking horse bid setting a floor). If the company likely wasn't viable in the future, they would be liquidating assets for creditors to receive partial payment on their investment.