Alimentation Couche-Tard Inc., through an indirectly wholly-owned subsidiary called 2707031 Ontario Inc., is to loan Fire & Flower Holdings Corp. a maximum aggregate amount of $30,000,000.
Fire & Flower is a technology-powered, adult-use cannabis retailer with more than 100 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."
The loan may be drawn down in three separate tranches of $10,000,000 and subject to the terms of the agreement, the loan will accrue interest at a rate of 8% per annum, payable quarterly, and matures on October 1, 2022.
In a release, Fire & Flower said it "intends to use the amounts drawn down under the loan to further develop the consumer digital platform as well as for general corporate purposes." The loan is secured by the assets of the company.
"Access to $30 million of non-dilutive debt financing is a strong show of support from our partner, Alimentation Couche-Tard. It also serves as a proof point on our alignment towards the future of cannabis retail. Through their leadership, network and expertise, we are accelerating the dynamics of the retail shopping experience and creating a consumer-centric marketplace that leverages technology and data-driven insights to deliver a personalized collection of products to consumers and reaches them wherever they are at," said Trevor Fencott, CEO of Fire & Flower. "As we move forward in our development, we are excited to continue to leverage this relationship and further expand our co-located store program to deliver the most convenient shopping experience to our customers."
ACT holds greater than 10% of the outstanding voting securities of the company. Through ACT's strategic investment, Fire & Flower has set its sights on global expansion, as new cannabis markets emerge and is poised to expand into the United States when permitted by 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. It owns and operates cannabis retail stores in Alberta, Saskatchewan, Manitoba, British Columbia and Ontario and the Yukon territory. Several are co-located with Circle K convenience stores.