Sugarbud Craft Growers Corp (SUGR)

[postal72]

SugarBud Announces Non-Dilutive Credit Facility and the Cancellation of Previously Announced Alumina Partners LLC Equity Facility
V.SUGR | 1 hour ago
TSX-Venture Exchange: SUGR, SUGR.WT

CALGARY, Alberta, June 05, 2019 (GLOBE NEWSWIRE) -- SugarBud Craft Growers Corp. (“SugarBud” or the “Company”) announces that its subsidiary, 1800905 Alberta Ltd., as borrower, has entered into a secured non-dilutive credit facility with Pillar Capital Corp. (“Pillar”) for up to CDN $5,000,000 (the "Credit Facility").

The proceeds of the Credit Facility will be used by SugarBud to support working capital requirements and to continue to equip Phase 1 of its 29,800 square foot Stavely, Alberta indoor cannabis cultivation facility (“Phase 1 Stavely Facility”). The Phase 1 Stavely Facility is expected to be capable of approximately 13,926,000 to 16,384,000 grams of annual dried cannabis production per year once fully equipped and operational.

Craig Kolochuk, SugarBud’s President and Chief Executive Officer stated: “This non-dilutive credit facility allows us to continue the diligent execution of our business plan prior to the receipt of our cultivation license from Health Canada, which we view as a major milestone and catalyst. We expect to obtain our cultivation license imminently, as we received confirmation of readiness from Health Canada on April 18, 2019 and we submitted our affirmation of readiness package prior thereto.”

It is SugarBud’s intention to replace this Credit Facility with a larger credit facility from another senior financial institution (the “Senior Facility”) upon receipt of SugarBud’s cultivation license from Health Canada. SugarBud is currently in negotiations with a leading credit union based in Alberta (the “Credit Union”) regarding the Senior Facility. It is expected that the Senior Facility will either be held by the Credit Union alone, or in a syndicate led by the Credit Union.

The Credit Facility is guaranteed by SugarBud and its wholly owned subsidiary Trichome Holdings Corp. The first $2 million of the Credit Facility is available for drawdown at SugarBud’s discretion, with draws thereafter subject to approval by Pillar. The Credit Facility bears interest at 12.5% per annum, calculated monthly on the daily balance outstanding. In connection with the Credit Facility, SugarBud will issue 1,000,000 common share purchase warrants to Pillar. Each warrant will entitle Pillar to purchase one common share of SugarBud at a price of $0.16 for a period of five years. The warrants will be subject to a four month hold period.

The Credit Facility and the issuance of warrants to Pillar are subject to final approval of the TSX Venture Exchange.

The Company also announces that it has cancelled, at its discretion, the previously announced equity facility with Alumina Partners LLC. SugarBud would like to thank Alumina Partners LLC for their support through the Company’s growth to date.

About SugarBud

SugarBud is an Alberta-based emerging cannabis company engaged in the development, acquisition, production and distribution of cannabis in Canada.

Craig Kolochuk
President & Chief Executive Officer
SugarBud Craft Growers Corp.
Phone: [phone]
E-mail: [e-mail]

Jeff Swainson
Chief Financial Officer
SugarBud Craft Growers Corp.
Phone: [phone]
E-mail: [e-mail]
Investor Relations Contact
Gary Perkins, President
Tekkfund Capital Corp.
Tel: [phone]
E-mail: [e-mail]

Website: http://www.sugarbud.ca/


Address: Suite 620, 634 - 6th Avenue S.W., Calgary, Alberta T2P 0S4
Telephone: [phone]
Fax: [phone]


Read more at https://stockhouse.com/companies/bullboard?symbol=v.sugr&postid=29799423#z6diHJtaY4oF3vc1.99