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General Assembly Pizza Secures C$2 Million Debt Financing

November, 05, 2021

Strategic loan will support omnichannel scaling, including increased production capacity, enhanced retail distribution, and expansion into Western Canada

General Assembly Holdings Limited (the “Company” or “GAPizza”) (TSXV: GA), a Toronto pizza restaurant-turned-omnichannel consumer packaged goods (“CPG”) brand, is pleased to announce that it has entered into loan arrangements with certain persons (each, a “Lender”) whereby the Lenders will advance to the Company an aggregate of $2,000,000 (the “Loans”).

GA Pizza will use the Loans for working capital, general corporate purposes, and to support the purchase of equipment at its new dedicated production facility in Vaughan, Ontario.

Benefits of the Loans:

  • Access to increased liquidity and financial flexibility to support the capital and operating expenses required to continue GA Pizza’s evolution from a single pizza restaurant to an omnichannel CPG brand.
  • Competitive terms, including no principal or interest repayments in the first two years and no penalty for early repayment, thereby supporting GA Pizza’s commitment to creating value for shareholders.
  • Strategic funding from informed lenders, including the Chief Financial Officer and a Director of the Company, reinforcing their strong commitment to building the GA Pizza brand and deep knowledge of the business.

“This loan will equip GA Pizza to fire on all cylinders,” said Ali Khan Lalani, Founder and Chief Executive Officer of GA Pizza. “With production increasing at our new dedicated facility, national expansion of our e-commerce and retail channels on the horizon, and a revitalized flagship restaurant opening soon, this added capital will allow us to meet increased demand with ease. It will help to fuel our growth.”

Loan terms:

The Loans will bear interest at a rate of 12% per annum, to be evidenced by promissory notes in favour of the Lenders and to be secured by a fixed and floating charge on the Company's assets pursuant to the terms of a general security agreement, which will rank subordinate in priority to any security interest granted by the Company to any bank, financial institution, or other commercial lender in connection with any future credit facility issued by such lender. The Loans will be repayable in equal monthly installments commencing on the date that is two years after the applicable Loan is advanced and ending on the date that is one year and six months after such date.

The Company will pay to the Lenders 1.2% of the principal amount of the Loans per annum as a monitoring fee. The Company also intends to issue to the Lenders, subject to approval of the TSX Venture Exchange (the “TSXV”), as loan bonuses, such number of common share purchase warrants of the Company (each, a "Bonus Warrant") as is equal to the lesser of (i) such Lender’s principal under the Loans divided by the volume-weighted average trading price of the Common Shares on the TSXV for the consecutive 30 trading day period immediately preceding the effective date of the applicable promissory note ("30-Day VWAP"); and (ii) the maximum number of Bonus Warrants permitted by the TSXV, with each Bonus Warrant expected to entitle the applicable Lender to acquire one Class A common share (“Common Share”) during the forty-two month term of the applicable Loan at an exercise price equal to the greater of (i) a 25% premium to the 30-Day VWAP; or (ii) the lowest price permitted by the TSXV. If any Loan is repaid prior to the one-year anniversary date of such Loan, it is expected that a pro rata number of Bonus Warrants issued in respect of such Loan shall have their term reduced to the later of one year from the issuance thereof and 30 days from said repayment.

The Company will be entitled to prepay the Loans, in whole or in part, at any time prior to the maturity date, without any notice being given to the Lender and without any bonus or penalty being paid to the Lender.

The Loans are subject to review and acceptance by the TSXV.

Related party transaction disclosure

Certain Lenders, namely Mr. Ted Hastings, a Director of the Company, and Mr. Jeff Collins, the Chief Financial Officer of the Company, are "related parties" (as defined in Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions ("MI 61-101")) of the Company and, therefore, the Loans from such Lenders, expected to be an aggregate of $500,000, are Related Party Transactions (as defined in MI 61-101) (the "Related Party Loans"). The Company is exempt from the formal valuation requirement and the minority approval requirement under MI 61-101 in respect of the Related Party Loans since, at the time of such loans, the fair market value of the consideration for the Related Party Loans does not exceed 25% of the Company's market capitalization.

About GA Pizza

GA Pizza began its life as a fast-casual pizza restaurant in the heart of Toronto. Nearly four years later, we also offer a freezer-to-table consumer packaged goods line and a revolutionary direct-to-consumer eCommerce experience—not to mention a pizza box with more than one pizza in it. Our ambition? Make delicious pizzas available to everyone, everywhere. We’re always working to take pizza to new heights—from showing the world that better pizza is possible, to finding new spaces and places to deliver unrivaled pizza experiences. Find us in your freezer or visit for more information.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Forward-Looking Information

This press release contains statements which constitute “forward-looking information” or “forward-looking statements” (together “forward-looking information”) within the meaning of applicable securities laws, including statements regarding the plans, intentions, beliefs and current expectations of the Company with respect to future business activities and operating performance. Forward-looking information is often identified by the words “may”, “would”, “could”, “should”, “will”, “intend”, “plan”, “anticipate”, “believe”, “estimate”, “expect” or similar expressions and includes information regarding anticipated TSXV acceptance of the Loans, the expected use of proceeds from the Loans, the continued evolution of the Company, the national expansion of the Company, the re-opening of the flagship restaurant, the Company's ability to meet increased demand, anticipated increases to the Company's production capacity at the master facility and the Company's growth strategy.

Investors are cautioned that forward-looking information is not based on historical facts but instead reflect the Company’s management’s expectations, estimates or projections concerning future results or events based on the opinions, assumptions and estimates of management considered reasonable at the date the statements are made. Although the Company believes that the expectations reflected in such forward-looking information are reasonable, such information involves risks and uncertainties, and undue reliance should not be placed on such information, as unknown or unpredictable factors could have material adverse effects on future results, performance or achievements of the combined company. Among key factors and risks that could cause actual results to differ materially from those projected in the forward-looking information may include, without limitation, the following: there being no market for the securities of the Company; the Company’s limited operating history; global economic risk; COVID-19’s impact on the Company; the general economic environment; cybersecurity risks; financial projections may prove materially inaccurate or incorrect; the Company may experience difficulties to forecast sales; general competition in the industry from other companies; management of growth-related risks; reliance on management; risks relating to insurance; changes in food and supply costs could adversely affect profitability and ultimately our results of operations; our business could be adversely affected by increased labour costs or difficulties in finding suitable employees; changes in customer tastes and preferences, spending patterns and demographic trends could cause sales to decline; changes in nutrition and food regulation; failure to establish our master production facility; failure to expand production capacity; disruption at our facilities; government regulation of the food industry creating risks and challenges; risk associated with food safety and consumer health; changes in internet and social media search algorithms; risks associated with leasing commercial and retail space; third party reliance for shipping and payment processing; environmental laws; we may not persuade customers of the benefits of paying our prices for higher-quality food; our marketing and advertising strategies may not be successful, which could adversely impact our business; requirements for further financing; the Company may prioritize customer growth and engagement and the customer experience over short-term financial results. This forward-looking information may be affected by risks and uncertainties in the business of the Company and market conditions.

Should one or more of these risks or uncertainties materialize, or should assumptions underlying the forward-looking information prove incorrect, actual results may vary materially from those described herein as intended, planned, anticipated, believed, estimated or expected. Although the Company has attempted to identify important risks, uncertainties and factors which could cause actual results to differ materially, there may be others that cause results not to be as anticipated, estimated or intended. The Company does not intend, and does not assume any obligation, to update this forward-looking information except as otherwise required by applicable law.

Investor Relations
Glen Akselrod, Bristol Capital

Tat Read, Communications Director, GA Pizza

Ali Khan Lalani, Chief Executive Officer & Founder, GA Pizza
(416) 583-5571

Source: General Assembly Holdings Limited

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