Big Rock Brewery: Closing of Private Placement and Debt Settlement

Big Rock Brewery Inc. (TSX: BR) has recently announced the successful closing of its private placement and debt settlement, marking a significant step forward for the company. The private placement raised a total of $8.4 million, with the funds being used to address the company's working capital deficiency, settle all amounts owing under the Second Lien Facility, and provide operating capital to Big Rock, allowing it to continue as a going concern.



The debt settlement involved the conversion of $9 million of the aggregate indebtedness outstanding under the Second Lien Facility to common shares at a conversion price equal to the subscription price of $1.00 per common share. The remaining proceeds from the private placement were used to repay $700,000 of indebtedness under the Corporation’s credit agreement with its senior lender, ATB Financial, for investment in capital projects and for working capital purposes. The Corporation’s indebtedness under its ATB facility is expected to be the only long-term debt outstanding following the completion of the debt settlement and the private placement.



The closing of the transactions is critical for the future growth of Big Rock's business, as it allows the company to prioritize and commit capital and resources, increase its capabilities and capacity in the Ready-To-Drink segment, and continue to improve and embrace its roots in the Craft Beer market. The strong demand for the private placement, which resulted in an upsizing of the private placement, is a reflection of the belief in the company's new management team, board, people, and business.

In summary, the closing of the private placement and debt settlement marks an important step forward for Big Rock, as it continues to work to grow revenues consistent with its strategic plan. The raised funds will be used to address the company's working capital deficiency, settle all amounts owing under the Second Lien Facility, and provide operating capital to Big Rock, allowing it to continue as a going concern. The company's strategic plan to prioritize and commit capital and resources, increase capabilities and capacity in the Ready-To-Drink segment, and continue to improve and embrace its roots in the Craft Beer market has likely contributed to the positive sentiment among investors.