SNDL Inc. and Nova Cannabis Inc. announced that SNDL has agreed to assign its rights to own or operate four Dutch Love stores to Nova.
“SNDL remains committed to strengthening Nova’s retail position and the sustainability of its capital structure, as underscored by the extension of the credit facility,” said Zach George, CEO of SNDL. “The assignment of four well-located cannabis retail stores to be owned or operated by Nova creates an opportunity for Nova to open its first Value Buds branded locations in British Columbia and highlights the benefit of SNDL’s M&A pipeline.”
Pursuant to the Assignment, Nova shall issue to SNDL $8.179 million of Nova shares based on the 20-day VWAP of the Nova shares on March 28, 2024. The closing of the transactions contemplated by the Assignment are subject to customary closing conditions, including the approval of the Toronto Stock Exchange (“TSX“) for the listing of the Nova shares issuable to SNDL, court approval and all other regulatory approvals, and is anticipated to close by the end of April 2024. The addition of the Dutch Love Stores is expected to bring Nova’s total store count to 100 and SNDL’s direct and indirect cannabis store count across all retail banners to 190.
SNDL has also extended the maturity date of the $15 million revolving credit facility (the “Revolving Credit Facility“) with Nova for an additional 24 months, to March 31, 2026, and has amended the Revolving Credit Facility to remove SNDL’s right to demand repayment prior to the maturity date, subject to certain conditions.
“The updates announced further solidify SNDL’s continued support of Nova’s growth trajectory,” said Anne Fitzgerald, lead independent director of Nova. “We will continue to collaboratively pursue avenues that support Nova’s expansion and optionality with our partners at SNDL.”
Advisors
McCarthy Tétrault LLP is acting as legal counsel to SNDL. Bennett Jones LLP is acting as legal counsel to Nova.
About SNDL Inc.
SNDL is a public company whose shares are traded on the Nasdaq under the symbol “SNDL.” SNDL is the largest private-sector liquor and cannabis retailer in Canada with retail banners that include Ace Liquor, Wine and Beyond, Liquor Depot, Value Buds, Spiritleaf, and Firesale Cannabis. SNDL is a licensed cannabis producer and one of the largest vertically integrated cannabis companies in Canada specializing in low-cost biomass sourcing, premium indoor cultivation, product innovation, low-cost manufacturing facilities, and a cannabis brand portfolio that includes Top Leaf, Contraband, Citizen Stash, SNDL Cannabis, Palmetto, Bon Jak, Spiritleaf Selects, Versus Cannabis, Value Buds, Vacay, Grasslands and Superette. SNDL’s investment portfolio seeks to deploy strategic capital through direct and indirect investments and partnerships throughout the North American cannabis industry. For more information on SNDL, please go to www.sndl.com.
About Nova Cannabis Inc.
Nova Cannabis Inc. is one of Canada’s largest and fastest-growing cannabis retailers with a goal of disrupting the cannabis retail market by offering a wide range of high-quality cannabis products at every-day best value prices. Nova currently owns and/or operates 96 locations across Alberta, Ontario, and Saskatchewan, primarily under its “Value Buds” banner. Additional information about Nova Cannabis Inc. is available at www.sedarplus.ca and Nova’s website at www.novacannabis.ca.
