Full Press Release Details
AURORA CANNABIS INC.
THE LENDERS FROM TIME TO TIME PARTY TO THIS AGREEMENT
as Administrative Agent
as Lead Arranger and Sole Bookrunner
SECOND AMENDED AND RESTATED CREDIT AGREEMENT
| ARTICLE I - INTERPRETATION | |
| 1.01 Definitions | 1 |
| 1.02 Accounting Principles | 25 |
| 1.03 Currency References | 26 |
| 1.04 Extended Meanings | 26 |
| 1.05 Amendment and Restatement | 26 |
| 1.06 Exhibits and Schedules | 26 |
| ARTICLE II - FACILITY A | |
| 2.01 Continuation of Facility A | 27 |
| 2.02 Purpose | 27 |
| 2.03 Revolving Nature | 27 |
| 2.04 Repayment | 28 |
| 2.05 Availment Options | 28 |
| 2.06 Interest and Fees | 28 |
| 2.07 Facility A Margin Limit | 29 |
| 2.08 Swingline | 30 |
| 2.09 Letters of Credit | 32 |
| 2.10 Cancellation | 34 |
| ARTICLE III - NON-REVOLVING FACILITIES | |
| 3.01 Continuation of Facility B | 34 |
| 3.02 [Intentionally Deleted] | 35 |
| 3.03 [Intentionally Deleted] | 35 |
| 3.04 Purpose | 35 |
| 3.05 Non-Revolving Nature; Advances | 35 |
| 3.06 Repayment | 35 |
| 3.07 Availment Options | 37 |
| 3.08 Interest and Fees | 37 |
| 3.09 [Intentionally Delated] | 38 |
| 3.10 Voluntary Repayments | 38 |
| 3.11 [Intentionally Deleted] | 38 |
| ARTICLE IV - ANCILLARY CREDIT PRODUCTS | |
| 4.01 Hedge Transactions | 38 |
| 4.02 MasterCard Line | 39 |
| 4.03 Service Agreements | 39 |
| ARTICLE V - GENERAL CONDITIONS | |
| 5.01 Matters relating to Interest | 40 |
| 5.02 Notice Periods | 41 |
| 5.03 Minimum Amounts, Multiples and Procedures re Draws, Substitutions and Repayments | 42 |
| 5.04 Place of Repayments | 43 |
| 5.05 Evidence of Obligations (Noteless Advances) | 43 |
| 5.06 Determination of Equivalent Amounts | 43 |
| 5.07 Commitment to Purchase Bankers' Acceptances and BA Equivalent Notes | 44 |
| 5.08 Provisions Regarding Bankers' Acceptances | 44 |
| 5.09 Provisions regarding BA Equivalent Notes | 46 |
| 5.10 No Repayment of Certain Availment Options | 47 |
| 5.11 Illegality | 47 |
| 5.12 Anti-Money Laundering | 48 |
| 5.13 Terrorist Lists | 48 |
| ARTICLE VI - REPRESENTATIONS AND WARRANTIES | |
| 6.01 Representations and Warranties | 48 |
| 6.02 Survival of Representations and Warranties | 54 |
| ARTICLE VII - COVENANTS | |
| 7.01 Positive Covenants | 54 |
| 7.02 Negative Covenants | 57 |
| 7.03 Financial Covenants | 60 |
| 7.04 Reporting Requirements | 60 |
| 7.05 [Intentionally Deleted] | 63 |
| 7.06 [Intentionally Deleted] | 63 |
| ARTICLE VIII - SECURITY | |
| 8.01 Security to be Provided by the Secured Companies | 63 |
| 8.02 Security to be Provided by Others | 64 |
| 8.03 Specific Pledge of Cash Collateral | 65 |
| 8.04 General Provisions re Security; Registration | 65 |
| 8.05 Opinions re Security | 65 |
| 8.06 After-Acquired Property, Further Assurances | 65 |
| 8.07 Security for Hedge Transactions | 66 |
| 8.08 Agent May Obtain Insurance | 66 |
| 8.09 Insurance Proceeds | 66 |
| 8.10 Unsecured Subsidiaries | 66 |
| 8.11 Quebec Hypothecary Representative | 67 |
| ARTICLE IX - CONDITIONS PRECEDENT | |
| 9.01 Conditions Precedent to Amendments | 68 |
| 9.02 Conditions Precedent to all Advances | 69 |
| 9.03 [Intentionally Deleted] | 70 |
| 9.04 [Intentionally Deleted] | 70 |
| 9.05 [Intentionally Deleted] | 70 |
| 9.06 [Intentionally Deleted] | 70 |
| 9.07 [Intentionally Deleted] | 70 |
| ARTICLE X - DEFAULT AND REMEDIES | |
| 10.01 Events of Default | 70 |
| 10.02 Acceleration, etc. | 72 |
| 10.03 Acceleration of Certain Contingent Obligations | 72 |
| 10.04 Combining Accounts, Set-Off | 73 |
| 10.05 Appropriation of Monies | 73 |
| 10.06 No Further Advances | 73 |
| 10.07 Judgment Currency | 73 |
| 10.08 Remedies Cumulative | 74 |
| 10.09 Performance of Covenants by Agent | 74 |
| 10.10 Appointment of Professional Advisor | 74 |
| ARTICLE XI - THE AGENT AND THE LENDERS | |
| 11.01 Decision-Making | 74 |
| 11.02 Security | 76 |
| 11.03 Application of Proceeds of Realization | 76 |
| 11.04 Payments by Agent | 77 |
| 11.05 Protection of Agent | 78 |
| 11.06 Duties of Agent | 79 |
| 11.07 Lenders' Obligations Several; No Partnership | 80 |
| 11.08 Sharing of Information | 80 |
| 11.09 Acknowledgement by Borrower | 80 |
| 11.10 Amendments to Article XI | 80 |
| 11.11 Deliveries, etc. | 80 |
| 11.12 Agency Fee | 81 |
| 11.13 Non-Funding Lender | 81 |
| ARTICLE XII - CBA MODEL PROVISIONS | |
| 12.01 CBA Model Provisions Incorporated by Reference | 82 |
| 12.02 Inconsistencies with CBA Model Provisions | 83 |
| ARTICLE XIII - GENERAL | |
| 13.01 Waiver | 83 |
| 13.02 Expenses of Agent and Lenders | 83 |
| 13.03 Debit Authorization | 83 |
| 13.04 General Indemnity | 84 |
| 13.05 Environmental Indemnity | 84 |
| 13.06 Survival of Certain Obligations despite Termination of Agreement | 85 |
| 13.07 Interest on Unpaid Costs and Expenses | 85 |
| 13.08 Assignment | 85 |
| 13.09 Notice | 85 |
| 13.10 Severability | 86 |
| 13.11 Further Assurances | 86 |
| 13.12 Time of the Essence | 86 |
| 13.13 Promotion and Marketing | 87 |
| 13.14 Entire Agreement; Waivers and Amendments to be in Writing | 87 |
| 13.15 Inconsistencies with Security | 87 |
| 13.16 Confidentiality | 87 |
| 13.17 Governing Law | 88 |
| 13.18 Execution by Fax and Counterparts | 88 |
| 13.19 Binding Effect | 88 |
"A" - Lenders and Lenders' Commitments
"C" - Rollover Notice
"D" - Substitution Notice
"E" - Repayment Notice
"F" - Borrowing Base Certificate
"G" - Monthly Compliance Certificate
"H" - Quarterly Compliance Certificate
"I" - [Intentionally Deleted]
"J" - Form of BA Equivalent Note
"K" - CBA Model Provisions
3.06(a) - Listed Properties and Lending Values
6.01(b) - Corporate Information (including list of Unsecured Subsidiaries)
6.01(h) - Material Permits
6.01(i) - Specific Permitted Liens
6.01(j) - Owned Properties
6.01(k) - Material Leased Properties
6.01(l) - Intellectual Property
6.01(n) - Material Agreements
6.01(o) - Labour Agreements
6.01(p) - Environmental Matters
6.01(q) - Litigation
6.01(r) - Pension Plans
SECOND AMENDED AND RESTATED CREDIT AGREEMENT
This Agreement dated December 17, 2020 is made among:
AURORA CANNABIS INC.
THE LENDERS FROM TIME TO TIME
PARTY TO THIS AGREEMENT
as Administrative Agent
as Lead Arranger and Sole Bookrunner
For good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged by each party, the parties agree as follows:
ARTICLE I - INTERPRETATION
In this Agreement, the words and phrases set out in the CBA Model Provisions (as hereinafter defined) shall have the respective meanings set forth therein (subject to section 12.01 hereof). In addition, the following words and phrases shall have the respective meanings set forth below:
"2019 Credit Agreement" means the first amended and restated credit agreement among the parties hereto dated September 4, 2019, as amended prior to the date hereof.
"2019 Convertible Notes" means the 5.50% convertible notes due February 28, 2024 issued by the Borrower pursuant to the trust indenture made between the Borrower and GLAS Trust Company LLC dated January 24, 2019.
"Acceleration Date" means the earlier of (i) the date of the occurrence of an Insolvency Event in respect of any Material Company; and (ii) the date on which the Borrower fails to repay all or any portion of the Obligations pursuant to an Acceleration Notice issued by the Agent.
"Acceleration Notice" is defined in section 10.02.
"Acceptable Appraisal" in respect of any Owned Property or Material Leased Property means an up-to-date appraisal by an AACI appraiser in form and substance satisfactory to the Lenders which considers the following approaches to value: fair market, cost, and comparable and alternate use value on a hypothetical best use facility; together with a transmittal letter from such appraiser addressed to the Agent which permits the Agent and the Lenders to rely thereon.
"Acquisition" means (a) a purchase or other acquisition by a Company of all or substantially all of the assets (or any division or business line thereof) of any Person, or (b) a purchase or other acquisition (whether by means of a merger, consolidation, or otherwise) by any Company of all or substantially all of the shares or other equity interests in any Person.
"Acquisition Cash Outlay" means, in respect of any Acquisition, the aggregate of (i) the purchase price for such Acquisition (whether payable at the time of completion thereof or at any future time) excluding any portion thereof which is satisfied entirely by the issuance of equity shares of the Borrower or unsecured convertible debentures of the Borrower which constitute Subordinated Debt, plus (ii) the aggregate amount of Funded Debt assumed in connection with such Acquisition.
"Adjusted GAAP" at any time means GAAP in effect at such time as if IFRS 16 had not been implemented.
"Advance" means an extension of credit by one or more of the Lenders to the Borrower pursuant to this Agreement, including for greater certainty an extension of credit in the form of a Loan, a Bankers' Acceptance, a BA Equivalent Loan or the issuance of a Letter of Credit.
"Affiliate" is defined in the CBA Model Provisions.
"Agent" means BMO in its capacity as the administrative agent hereunder, and its successors in such capacity.
"Agreement" means this credit agreement (including the Exhibits and Schedules) as it may be amended, supplemented, replaced or restated from time to time; and each reference herein to "this Agreement", "the date hereof", "the date of this Agreement" and similar references are references to this amended and restated credit agreement and not to the 2019 Credit Agreement
"Aggregate Actual Hedge Liability" means, on any date of determination, the net aggregate amount of the Borrower's liability under all Hedge Transactions outstanding on such date in the event of a default or termination thereunder, calculated in accordance with the terms thereof (and for greater certainty, determined after netting any amounts payable to the Borrower thereunder against amounts payable by the Borrower thereunder).
"Amendment Closing Date" means the date on which all conditions precedent listed in section 9.01 herein have been satisfied, as confirmed by the Agent to the Borrower in writing.
"AML Legislation" means all anti-money laundering, anti-terrorist financing, government sanction and "know your client" Laws in effect in any jurisdiction in which any Company carries on business or owns assets, including any guidelines or orders thereunder, specifically including the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (Canada).
"Annual Business Plan" is defined in section 7.04(e).
"Applicable Law" is defined in the CBA Model Provisions.
"Applicable Margin" means, in respect of any Availment Option and in respect of any Fiscal Quarter, the percentage in the column relating to such Availment Option in the following table:
| Prime Rate Loan | Bankers' Acceptance / BA Equivalent Loan / Letter of Credit | Standby Fee |
| 3.00% | 4.25% | 0.85% |
"Associate" has the meaning ascribed thereto in the Canada Business Corporations Act.
"Aurora Sky Property" means the Material Leased Property municipally known as 4903 36th Street East, Edmonton International Airport, Alberta leased by 1769474 Alberta Ltd. (a wholly-owned Subsidiary of the Borrower) as tenant from Edmonton Regional Airports Authority as landlord pursuant to a lease dated May 1, 2017.
"Availment Option" means a method of borrowing which is available to the Borrower as provided herein.
"BA Equivalent Loan" means an Advance in Canadian Dollars made by a Non-BA Lender to the Borrower in respect of which the Borrower has issued a BA Equivalent Note.
"BA Equivalent Note" means a promissory note payable by the Borrower to a Non-BA Lender in the form of Exhibit "J" attached hereto.
"BA Lender" means a Lender identified in Exhibit "A" attached hereto as a Lender which will accept Bankers' Acceptances hereunder.
"Bankers' Acceptance" means a bill of exchange or a blank non-interest bearing depository bill as defined in the Depository Bills and Notes Act (Canada) drawn by the Borrower and accepted by a BA Lender in respect of which the Borrower becomes obligated to pay the face amount thereof to the holder (which may be a third party or such BA Lender) upon maturity.
"BIA" means the Bankruptcy and Insolvency Act (Canada).
"BMO" means Bank of Montreal and its successors and permitted assigns.
"Borrower" means Aurora Cannabis Inc., a corporation subsisting under the federal Laws of Canada.
"Borrowing Base Certificate" means a certificate delivered by the Borrower to the Agent in the form of Exhibit "F".
"Business Day" means any day on which the Agent is open for over-the-counter business in both Toronto, Ontario and Edmonton, Alberta, excluding Saturday, Sunday and any other day that is a statutory holiday in Toronto, Ontario or Edmonton, Alberta.
"Canadian Dollars" or "CDN$" means the lawful money of Canada.
(a) any plant or seed, whether live or dead, from any species or subspecies of genus Cannabis, including Cannabis sativa, Cannabis indica and Cannabis ruderalis, Marijuana and any part, whether live or dead, of the plant or seed thereof, including any stalk, branch, root, leaf, flower, or trichome;
(b) any material obtained, extracted, isolated, or purified from the plant or seed or the parts contemplated by clause (a) of this definition, including any oil, cannabinoid, terpene, genetic material or any combination thereof;
(c) any organism engineered to biosynthetically produce the material contemplated by clause (b) of this definition, including any micro-organism engineered for such purpose;
(d) any biologically or chemically synthesized version of the material contemplated by clause (b) of this definition or any analog thereof, including any product made by any organism contemplated by clause (c) of this definition;
(e) any other meaning ascribed to the term "cannabis" under Applicable Law in any Qualified Jurisdiction, including the Cannabis Act and the Controlled Drugs and Substances Act (Canada); and
(f) any other meaning ascribed to the term "cannabis" under the Controlled Substances Act (United States);
provided that the term "Cannabis" shall exclude Industrial Hemp except that in the context of any product which is subject to regulation under the Food, Drug and Cosmetic Act (United States), "Cannabis" shall include Industrial Hemp unless and until cannabidiol derived from Industrial Hemp has been approved thereunder.
"Cannabis Act" means An Act respecting cannabis and to amend the Controlled Drugs and Substances Act, the Criminal Code and other Acts, S.C. 2018, c. 16, as amended from time to time.
"Cannabis-Related Activities" means any activities, including advertising or promotional activities, relating to or in connection with (i) the possession, importation, exportation, cultivation, production, purchase, testing, distribution or sale of Cannabis; (ii) the design and engineering of cannabis facilities; or (iii) consulting activities relating to any of the foregoing (but for greater certainty not including consulting activities in any jurisdiction which are not subject to any Applicable Laws relating to Cannabis in such jurisdiction).
"Cannabis Regulations" means the Cannabis Regulations under the Cannabis Act, as amended from time to time and all other regulations made from time to time under the Cannabis Act or any other statute in effect in a Qualified Jurisdiction with respect to Cannabis-Related Activities.
"Canadian Companies" means those Companies incorporated under the laws of Canada or a province thereof.
"Capital Expenditures" means expenditures made directly or indirectly which are considered to be in respect of the acquisition or leasing of capital assets in accordance with GAAP, including the acquisition or improvement of Land, plant, machinery or equipment, whether fixed or removable.
"Capital Lease" means any lease of assets which in accordance with Adjusted GAAP would be required to be capitalized on the balance sheet of the lessee.
"Cash Collateral" has the meaning set out in Section 8.03 herein.
"Cash Taxes" in respect of any fiscal period means amounts actually paid by the Companies in such fiscal period in respect of income and capital Taxes (whether relating to such fiscal period or any other fiscal period).
"CBA Model Provisions" means the model credit agreement provisions attached hereto as Exhibit "K", which have been revised under the direction of the Canadian Bankers' Association Secondary Loan Market Specialist Group from provisions prepared by The Loan Syndications and Trading Association, Inc.
"CDOR Rate" means on any day the annual rate of interest which is the rate determined as being the arithmetic average of the quotations of all institutions listed in respect of the rate for Canadian Dollar denominated bankers' acceptances for the relevant period displayed and identified as such on the "Reuters Screen CDOR Page" (as defined in the International Swap Dealer Association, Inc. definitions, as modified and amended from time to time) as of 10:00 a.m. Toronto, Ontario local time on such day and, if such day is not a Business Day, then on the immediately preceding Business Day (as adjusted by the Agent after 10:00 a.m. Toronto, Ontario local time to reflect any error in a posted rate of interest or in the posted average annual rate of interest with notice of such adjustment in reasonable detail evidencing the basis for such determination being concurrently provided to the Borrower); provided that if such rates are not available on the Reuters Screen CDOR Page on any particular day, then the CDOR Rate on that day shall be the average of the rates applicable to Canadian Dollar bankers' acceptances for the relevant period quoted for customers in Canada by the Agent as of 10:00 a.m. Toronto, Ontario local time on such day; or if such day is not a Business Day, then on the immediately preceding Business Day; and provided further that the CDOR Rate shall not be less than zero.
"Code of Conduct" means the document entitled "Aurora Cannabis Inc. Code of Business Conduct and Ethics" adopted by the board of directors of the Borrower, a copy of which has been provided to the Lenders.
"Collateral" means all property, assets and undertaking of the Secured Companies encumbered by the Security, together with all proceeds of the foregoing.
"Commitment" means, in respect of any Lender, such Lender's commitment to make Advances to the Borrower under the Facilities (or if required by the context, under a Facility or Tranche).
"Companies" means the Borrower and all of its Subsidiaries from time to time; and "Company" means any of them as the context requires.
"Control" is defined in the CBA Model Provisions.
"Copyrights" means all rights, title and interests (and all related IP Ancillary Rights) arising under any requirement of Law in copyrights and all mask work, database and design rights, whether or not registered or published, all registrations and recordations thereof and all applications in connection therewith.
"Currency Hedge Transaction" mean an agreement made between the Borrower and a Lender for the purpose of hedging currency risk, including a currency exchange agreement or a foreign exchange forward contract.
"Deeds of Hypothec" means, collectively, (i) the deeds of hypothec executed on or prior to the Facilities Initial Establishment Date by any of the Secured Companies named therein, and (ii) each deed of hypothec executed after the Facilities Initial Establishment Date by any existing or new Secured Company having its domicile (within the meaning of the Civil Code of Qu bec) or Administrative situated in the Province of Quebec, in each case in favor of the Agent acting in the capacity of hypothecary representative (within the meaning of Article 2692 of the Civil Code of Qu bec) and in form and substance (x) substantially consistent with the deed of hypothec referred to in the preceding clause (i), or (y) otherwise reasonably satisfactory to the Agent, as each of such deeds of hypothec may be amended, supplemented, replaced or otherwise modified from time to time.
"Default" is defined in the CBA Model Provisions.
"Defined Benefit Pension Plan" means any Pension Plan which contains a "defined benefit provision" as defined in subsection 147.1(1) of the Income Tax Act (Canada).