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Mimi's Rock Corp
Symbol MIMI
Shares Issued 49,559,337
Close 2019-12-13 C$ 0.38
Recent Sedar Documents

Mimi's Rock closes acquisition of two companies

2019-12-13 14:44 ET - News Release

Mr. Dave Kohler reports

MIMI'S ROCK CORP. CLOSES ACQUISITION OF ALL NATURAL ADVICE AND MARITIME NATURALS, RESTRUCTURES SENIOR CREDIT FACILITIES

Mimi's Rock Corp. has completed its previously announced acquisition of All Natural Advice Ltd. and Maritime Naturals Ltd. by way of a share purchase transaction. Combined, the acquired businesses generated approximately $5.5-million of revenue and $1.6-million of EBITDA (earnings before interest, taxes, depreciation and amortization) over the past 12 months, with consolidated revenue growing 29 per cent year over year and EBITDA growth of 109 per cent on a year-over-year basis. In connection with the transaction, the company has renegotiated its senior credit facility, providing cash for the acquisition while reducing borrowing costs.

"This acquisition is not only immediately accretive, it is also an excellent strategic fit for Mimi's Rock Corp. All Natural Advice has business in several European countries which were future target markets for us. This allows us to accelerate our strategy," commented Dave Kohler, chief executive officer of Mimi's Rock.

The purchase price was satisfied by: (i) payment, in aggregate, of approximately $5.5-million in cash; (ii) the issuance of an aggregate of 3,203,048 common shares in the capital of Mimi's Rock, 75 per cent of which will remain still subject to escrow; and (iii) the assumption of a loan from the vendors in the amount of approximately $2-million, which loan is to be repaid within 12 months of closing. The cash portion of the purchase price is paid with a combination of cash on hand and additional borrowings under the company's long-term debt facility with Bank of Nova Scotia, the terms of which were amended and restated on Dec. 13, 2019.

All Natural and Maritime Naturals currently offer products in Germany, Italy, the United Kingdom and Australia, giving Mimi's Rock immediate access to these markets. The company believes that their products will allow Mimi's Rock to offer 45 additional SKUs to its already impressive basket of products by offering: anti-aging organic skin care products; all-natural masks and scrubs; acne blemish treatments; and beard oils.

Senior debt refinancing

On Dec. 13, 2019, the company modified its secured debt facility, as originally entered into on July 6, 2018. The revised facility matures on Dec. 13, 2022, and provides for a $16,632,000 term loan that is repayable over four years, initially at the Canadian Bankers' Acceptance rate plus 3 per cent, or approximately 4.95 per cent effective rate, with quarterly payments of principal and interest beginning March, 2020. The revised credit facility also continues to provide for an operating line of credit, secured by inventory and accounts receivable, as well as corporate credit cards. Importantly, the requirement that the company insure its debt with Export Development Canada has been removed, lowering the company's overall cost of capital.

The facility is secured by all assets of the company and contains affirmative and negative covenants, including compliance with laws and restrictions on additional debt, as well as traditional financial covenants, such as debt to earnings and other coverage ratios.

About Mimi's Rock Corp.

Mimi's Rock is an on-line dietary supplement and wellness company operating under the Dr. Tobias brand. The company currently serves customers in the United States and has rapid growth plans to expand into other markets.

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