Freshlocal Obtains Initial Order under Companies' Creditors Arrangement Act (Canada)
VANCOUVER, BC, May 16, 2022 /CNW/ - Freshlocal Solutions Inc. (TSX: LOCL) (OTC: FLOCF) ("Freshlocal" or the "Company") was granted an initial order (the "Initial Order") today pursuant to the Companies' Creditors Arrangement Act (the "CCAA") by the Supreme Court of British Columbia on application by the Company seeking court protection from its creditors to allow it to pursue a restructuring of its business and property as a going concern.
Pursuant to the Initial Order, Ernst & Young Inc. was appointed as monitor (the "Monitor") in the CCAA proceeding and will assist the Company in creating a restructuring plan, which is anticipated to include, among other things, (i) immediately commencing a sale and investment solicitation process (a "SISP"), to be overseen by the Monitor, that would seek to monetize the Company's core and non-core assets, (ii) finalizing interim financing arrangements in order to obtain short term liquidity, (iii) continuing the initiatives already commenced to streamline and focus the go-forward operations of the Company and its subsidiaries and (iv) pursuing discussions with potential financiers in order to secure long-term funding for the projects that may form the basis of the Company's go-forward business (subject to the SISP), all under the supervision of the court and with the assistance of the Monitor.
Given the market conditions, the Company was unable to obtain further bridge financing as described in the Company's news release dated April 12, 2022. The Company shall use CCAA to access interim financing to run a SISP.
Trading in the Company's common shares (the "Common Shares") on the Toronto Stock Exchange (the "TSX") has been halted and the Company expects that, as a result of having filed for protection under the CCAA, the Common Shares may be delisted from trading on the TSX.
The Company is committed to completing the restructuring process as quickly as possible with the assistance and oversight of the Monitor.
Freshlocal is a Vancouver-based company that is building a leadership position in the provision of end-to-end grocery e-commerce solutions. The Company operates two primary businesses, FoodX and eGrocery, both of which support its corporate mission to innovate food systems for people, planet and prosperity. Food-X Technologies ("FoodX") is Freshlocal's scalable end-to-end SaaS-based eGMS which is designed to meet the needs of large and small grocery retailers while providing profitable unit economics. The FoodX eGMS is the culmination of over 20 years of experience in online grocery and the Company's proven track record of delivering efficiently, sustainably and profitably. The Company's consumer eGrocery business has expanded into one of Canada's largest online grocery companies, with a focus on delivering fresh, local, organic produce and groceries, along with exceptional customer experiences. Freshlocal serves the main urban markets in Alberta and British Columbia through its brick and mortar store locations operating under the Blush Lane and Be Fresh banners, as well as through SPUD.ca which is the Company's award-winning online eGrocery platform. Freshlocal's common shares are listed on the Toronto Stock Exchange under the symbol "LOCL" and quoted on the OTC Pink Marketplace under the symbol "FLOCF". Please visit www.freshlocalsolutions.com.
This release contains certain information which, as presented, constitutes "forward-looking information" or "forward-oriented financial information" within the meaning of applicable Canadian securities laws. Forward-looking information involves statements that relate to future events and often addresses expected future business and financial performance, containing words such as "anticipate", "plan", "explore" and "expect", statements that an action or event "may", "should" or "will" be taken or occur, or other similar expressions and includes, but is not limited to, statements regarding (i) the Company's restructuring plan; (ii) the SISP process; (iii) future interim financing arrangements of the Company; (iv) the Company's performance improvement initiatives; (v) the Company's long-term funding prospects; and (vi) the potential delisting of the Company's shares. Such statements reflect the Company's current views with respect to future events. Such statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable by the Company as at the date of this press release, are inherently subject to significant uncertainties and contingencies. Many factors could cause the Company's actual results, performance or achievements to be materially different from any future results, performance or achievements that may be expressed or implied by such forward-looking statements. The Company cautions readers that should certain risks or uncertainties materialize, or should underlying estimates or assumptions prove incorrect, actual results, performance or achievements may vary significantly from those expected. There can be no assurance that the actual strategies, results, performance, events or activities anticipated by the Company will be realized or, even if substantially realized, that they will have the expected consequences to, or effects on, the Company.
The Company undertakes no obligation to update forward-looking statements except as required by Canadian securities laws. Readers are cautioned against attributing undue certainty to forward-looking statements.
SOURCE Freshlocal Solutions Inc.
Investor Relations: Monika Russell, Chief Financial Officer, (866) 857-7783, [email protected]; Media Relations: [email protected]
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