- Allows FLUENT banner to make bigger its retail door depend to 42, upload on its first wholesale department in addition to proceed to make bigger its space of manufacturers
- One in every of the most important U.S. hashish transactions of 2024, additional bolstering FLUENT’s stability sheet with roughly US$33 million1,2 in money simply weeks after securing industry-attractive refinancing that positions the corporate to believe further M&A and expansion alternatives
- Acquires RIV Capital’s property and money stability in a debt-free, all-stock transaction: The Hawthorne Collective completes the trade of its present convertible notes in RIV Capital for a brand new elegance of nonvoting exchangeable stocks of Cansortium, getting rid of US$160 million3 of debt
[PRESS RELEASE] – TAMPA, Fla., Dec. 19, 2024 – Cansortium Inc., a vertically built-in, multistate hashish corporate working below the FLUENT logo, and RIV Capital Inc., a vertically built-in hashish corporate working the Etain logo in New York, are happy to announce the crowning glory of the up to now introduced association with RIV Capital (the “transaction”), wherein FLUENT obtained all of the issued and exceptional Magnificence A not unusual stocks (the “RIV capital stocks”) of RIV Capital in trade for FLUENT stocks (as outlined underneath) pursuant to the phrases of an association settlement dated Might 30, 2024 (as amended, the “association settlement”).
Below the phrases of the association settlement, RIV Capital shareholders (the “RIV Capital shareholders”) won 1.245 of a not unusual proportion of FLUENT (the “FLUENT stocks”) in trade for each and every RIV Capital proportion held. Consequently, shareholders of FLUENT (the “FLUENT shareholders”) dangle roughly 51.25% of the mixed industry of FLUENT and RIV Capital (the “mixed corporate”) and the RIV Capital shareholders and The Hawthorne Collective Inc., in combination, dangle roughly 48.75% of the mixed corporate, each and every on a completely diluted foundation. The mixed corporate will proceed to perform below the FLUENT identify and the FLUENT stocks will proceed to industry at the Canadian Securities Alternate (CSE) below the logo “TIUM.U” and at the OTCQB Undertaking Marketplace below the logo “CNTMF.”
Below the phrases of the association settlement, Robert Beasley has been named CEO of the mixed corporate. The RIV stocks are anticipated to be delisted from the CSE at marketplace shut on Dec. 19, 2024. The Ccompany will purpose RIV Capital to use to the related Canadian securities regulatory government to stop to be a reporting issuer below appropriate Canadian securities rules.
Control Remark
“I’m delighted to finish this transaction, and I want to thank our mixed groups for all in their exhausting paintings over the last few months and our shareholders for his or her robust give a boost to,” Beasley stated. “In combination, now we have created probably the most well-positioned hashish operators within the {industry}, with a strategic footprint in 4 key expansion markets and a robust stability sheet, which can let us act on accretive expansion alternatives. With integration actions nicely underway, our groups have persevered to discover synergies that, mixed with our historical past of operational excellence, will permit us to construct an effective, successful group.”
Beasley added, “With New York criminal retail gross sales on tempo to exceed $1 Billion via 12 months finish4, our fresh a hit release of MOODS in New York underscores the immense possible of the mixed corporate, as now we have offered FLUENT’s manufacturers to scale the wholesale operations and acquire further shelf house in dispensaries around the state. With our confirmed retail and cultivation experience, we can proceed to optimize and construct upon the robust basis now we have constructed within the nice looking markets the place we perform. Having a look forward, we stay curious about sustainable, long-term expansion and can proceed to force efficiencies throughout all spaces of the industry to succeed in our profitability and money technology objectives for our shareholders.”
“This can be a transformational deal for RIV Capital and represents the end result of considerable paintings for each FLUENT and RIV Capital,” stated David Vautrin, former leader income officer and Intervening time CEO of RIV Capital and, upon ultimate, leader business officer of FLUENT. “As evidenced via previous efficiency, we imagine FLUENT is likely one of the maximum essentially sound and now probably the most well-positioned multistate operators in the US. I’m taking a look ahead to totally unlocking the possible of this mixed crew to force worth for our shareholders.”
Hawthorne Notes Alternate
Additional to the corporate’s press free up dated Might 30, 2024, the corporate and The Hawthorne Collective entered into an trade and coverage settlement on Dec. 18, 2024 (the “trade and coverage settlement”), pursuant to which The Hawthorne Collective exchanged its present unsecured convertible notes within the combination major quantity of US$160 million, together with any accumulated and unpaid hobby payable via RIV Capital, for 153,069,395 nonvoting exchangeable stocks (the “exchangeable stocks”) within the capital of the corporate (the “Hawthorne notes trade”).
As well as, the trade and coverage settlement accommodates positive provisions that restrict The Hawthorne Collective from changing its exchangeable stocks into FLUENT stocks the place such conversion would lead to The Hawthorne Collective, at the side of any individual or corporate performing collectively or in live performance with The Hawthorne Collective, having an combination recommended possession of, or regulate or path over, without delay or not directly, over 19.99% of the corporate’s issued and exceptional balloting securities right away after giving impact to such conversion, until and till the corporate has won the important shareholder approval based on all appropriate insurance policies of the CSE.
For more info at the trade and coverage settlement and the Hawthorne notes trade, see the corporate’s information free up dated Might 30, 2024, and the control data round of the corporate dated July 12, 2024, filed below the corporate’s profile on SEDAR+ at www.sedarplus.ca.
The foregoing description of the trade and coverage settlement isn’t entire and is certified in its entirety via connection with the complete textual content of the trade and coverage settlement, a duplicate of which might be filed at the corporate’s profile on SEDAR+ at www.sedarplus.ca.
Investor Rights Agreements
In reference to the Hawthorne notes trade, the corporate and The Hawthorne Collective additionally entered into an investor rights settlement (the “Hawthorne investor rights settlement”), offering for, amongst different issues, the appropriate of The Hawthorne Collective to appoint as much as two individuals to the board of administrators of the corporate (the “FLUENT Board”), as long as The Hawthorne Collective and its associates handle positive specified recommended possession necessities as set forth within the Hawthorne investor rights settlement.
As well as, for as long as the recommended possession requirement is glad, The Hawthorne Collective is entitled to positive participation rights so as to handle its professional rata fairness possession place within the corporate in reference to any providing of FLUENT stocks, or securities exercisable, convertible or exchangeable for FLUENT stocks, via the corporate, matter to positive exceptions, and likely different standard rights, together with call for registration rights, piggyback rights and knowledge rights.
As well as, additional to the corporate’s press free up dated Nov. 26, 2024, the corporate and likely of its associates and William Smith, a director and the manager chair of the corporate, and likely firms managed via Smith (at the side of Smith, jointly, the “Smith staff”), have entered into an investor rights settlement (the “Smith investor rights settlement”) in reference to that positive amended and restated termination settlement dated Nov. 26, 2024, offering for, amongst different issues, the Smith staff’s persevered proper to appoint two individuals of the FLUENT Board, as long as the Smith staff and its associates handle positive specified recommended possession necessities as set forth within the Smith investor rights settlement. The Smith investor rights settlement accommodates considerably an identical phrases because the Hawthorne investor rights settlement, together with positive collaborating and piggyback registration rights.
The foregoing descriptions of the Hawthorne investor rights settlement and the Smith investor rights settlement aren’t entire and are certified of their entirety via connection with the total texts of the Hawthorne investor rights settlement and the Smith investor rights settlement, copies of which can be filed at the corporate’s profile on SEDAR+ at www.sedarplus.ca.
Further Data for RIV Capital Shareholders
Pursuant to the transaction, former RIV Capital shareholders are entitled to obtain 1.245 FLUENT stocks for each and every RIV Capital proportion held. In order to obtain FLUENT stocks in trade for RIV Capital stocks, former registered RIV Capital shareholders will have to entire, signal, date and go back (at the side of their certificates or DRS commentary representing their RIV Capital stocks) the letter of transmittal that used to be mailed to them previous to ultimate of the transaction. The letter of transmittal has been filed via RIV Capital below RIV Capital’s profile on SEDAR+ at www.sedarplus.ca and on RIV Capital’s site at www.rivcapital.com. The letter of transmittal may be to be had via contacting Odyssey Agree with Corporate, the depositary for the transaction, via phone at (587) 885-0960 or via e-mail at: [email protected].
