Fire & Flower Announces Exercise of Series A-3 Warrants by Alimentation Couche-Tard
Exercise of warrants brings Circle K owner, Alimentation Couche-Tard to 22.35% ownership of Fire & Flower
EDMONTON, AB, June 23, 2021 /CNW/ – Fire & Flower Holdings Corp. (“Fire & Flower” or the “Company”) (TSX: FAF) (OTCQX: FFLWF), today announced that 2707031 Ontario Inc. (“2707”, a wholly-owned indirect subsidiary of Alimentation Couche-Tard Inc. (collectively “ACT”), the owners of Circle K, has delivered in escrow its exercise notice (the “Exercise Notice”) and gross proceeds of $9,770,374.47 to exercise warrants (the “A-3 Warrants”) to acquire 10,505,779 common shares of Fire & Flower (the “Shares”) at an exercise price of $0.93 per common share pursuant to the terms of an Amended and Restated Warrant Certificate dated September 16, 2020.
ACT, together with 2707, currently owns 66,328,421 common shares of Fire & Flower representing approximately 19.9% of its issued and outstanding shares. Issuance of the Shares will increase ACT’s collective ownership of common shares of Fire & Flower by approximately 2.45%.
Fire & Flower and 2707 have agreed to terms of escrow that the proceeds be released to Fire & Flower and the Shares issued to 2707 within two (2) business days of expiry or termination of the applicable waiting period under the Competition Act or, alternatively, receipt of an advance ruling certificate or no action letter from the Commissioner of Competition (“Competition Act Clearance”). The parties are working to obtain Competition Act Clearance as soon as possible and, in any event, prior to September 1, 2021.
In addition to the A-3 Warrants, 2707 holds $2,674,906 principal amount of 8.0% convertible debentures, and share purchase warrants which, together with certain participation and top-up rights pursuant to an Amended and Restated Investor Rights Agreement dated September 16, 2020 which, if exercised in full, would entitle ACT to aggregate direct and indirect ownership of 50.1% of the issued and outstanding common shares of Fire & Flower on a fully diluted basis.
Alimentation Couche-Tard has been a strategic partner of Fire & Flower for almost two years and has been key in supporting the expansion of our data-driven retail network and improving our financial position through their continued investment.
Trevor Fencott, Chief Executive Officer of Fire & Flower.
The exercise of these warrants speaks to the continued growth of our partnership and 2707’s strong support of Fire and Flower’s technology-driven retail strategy to drive ongoing financial and operational growth.
Fencott added, “With our strengthened balance sheet, we are strategically positioned to expand across Canada and in the U.S. as we continue to build out our omni-channel retail portfolio.”
About Fire & Flower
Fire & Flower is a leading, technology-powered, adult-use cannabis retailer with more than 85 corporate-owned stores in its network. The Company leverages its wholly-owned technology development subsidiary, Hifyre Inc., to continually advance its proprietary retail operations model while also providing additional independent high-margin revenue streams. Fire & Flower guides consumers through the complex world of cannabis through education-focused, best-in-class retailing while the Hifyre digital retail and analytics platform empowers retailers to optimize their connections with consumers. The Company’s leadership team combines extensive experience in the technology, cannabis and retail industries.
Through the strategic investment of Alimentation Couche-Tard Inc. (owner of Circle K convenience stores), the Company has set its sights on global expansion as new cannabis markets emerge and is poised to expand into the United States when permitted through its strategic licensing agreement with American Acres Managers upon the occurrence of certain changes to the cannabis regulatory regime.
Fire & Flower is a multi-banner cannabis retail operator that owns and operates the Fire & Flower, Friendly Stranger, Happy Dayz and Hotbox brands. Fire & Flower Holdings Corp. owns all issued and outstanding shares in Fire & Flower Inc. and Friendly Stranger Holdings Corp., licensed cannabis retailers that own and operate cannabis retail stores in the provinces of British Columbia, Alberta, Saskatchewan, Manitoba, Ontario, and the Yukon territory.
To learn more about Fire & Flower, visit www.fireandflower.com.