SOL Global Provides Notice of and Background to Litigation Commenced by Lender Seeking $550M+ on $50M 24-Month Loan

SOL Global Has Advised Lender It Is in Position to Repay Debenture in Cash Pursuant to Terms of Loan

March 01, 2021 09:17 AM Eastern Standard Time
TORONTO–(BUSINESS WIRE)–SOL Global Investments Corp. (“SOL Global” or the “Company”) (CSE: SOL) (OTCPK: SOLCF) (Frankfurt: 9SB) today provides notice and background concerning the copycat litigation commenced against it and others by its lender, an offshore hedge fund, which litigation concerns the same issues as the Company’s previously announced U.S. complaint against that lender.

U.S. Complaint

On February 7, 2021, SOL Global initiated litigation in the State of New York against its lender, 1235 Fund LP, an offshore hedge fund and an affiliate of MMCAP Asset Management, seeking declaratory relief that, among other things, this lender is not entitled to be repaid in any property other than cash. Diligent efforts to prosecute this claim are underway, and the lender must respond to the Complaint in March 2021.

The Company is being represented in the litigation by attorney Alex Spiro of Quinn Emanuel Urquhart & Sullivan, LLP.

The case is SOL Global Investments Corp., et al. v. 1235 Fund LP and MM Asset Management, Inc., Index No. 650858/2021 (Supreme Court, New York).

Background

On July 8, 2019, the Company announced that it had completed a $50,000,000 private placement financing by way of the issue and sale of a senior secured non-convertible debenture (“Debenture”). The Debenture bears interest at 6.0% per annum and will mature on July 5, 2021. A copy of SOL Global’s original press release concerning the Debenture, which clearly states it is a non-convertible debenture, may be viewed at https://www.newswire.ca/news-releases/sol-global-completes-50-million-debenture-financing-and-announces-corporate-update-871790166.html.