Annual report pursuant to Section 13 and 15(d)

Commitments

v3.22.0.1
Commitments
 12 Months Ended
Dec. 31, 2021
Commitments and Contingencies Disclosure [Abstract]  
Commitments
Note 12 – Commitments
In the ordinary course of business, the Company enters into contractual agreements with third parties that include
non-cancelable
payment obligations, for which it is liable in future periods. These arrangements can include terms binding the Company to minimum payments and/or penalties if it terminates the agreement for any reason other than an event of default as described in the agreement.
The following
table summarizes the Company’s contractual obligations and commitments as of December 31, 2021: 

    
2022
     
2023
     
2024
     
2025
     
2026
  
Operating leases
    $ 7,342      $ 7,367      $ 7,501      $ 7,637      $ 7,439  
Service contracts
      2,705        3        —          —          —    
Long-term debt, principal
(1)
      168,209        12,531        66        16,654        79  
    
 
 
     
 
 
     
 
 
     
 
 
     
 
 
  
Total
  
$
 178,256
 
  
$
 19,901
 
  
$
 7,567
 
  
$
 24,291
 
  
$
 7,518
 
    
 
 
     
 
 
     
 
 
     
 
 
     
 
 
  
 
(1)
The payment schedule above shows amounts payable if the conversion options are not exercised by the lender of the Company’s convertible debt instruments.
The Company’s commitments
include employees, consultants and advisors, as well as leases and construction contracts for offices, dispensaries and cultivation facilities in the U.S. and Canada. The Company has certain operating leases with renewal options
extending
the initial lease term for an additional one to 15 years.
Line of Credit to Zia Integrated, LLC
On May 23, 2019, the Company entered into a line of credit agreement (the “Zia Agreement”) with Zia Integrated, LLC (“Zia”), a cannabis management and consulting firm based in Maryland, permitting Zia drawdowns of up to an aggregate of $15.0 million. For each drawdown made by Zia, a convertible promissory note will be issued to Zia by the Company (the “Convertible Note”). On August 5, 2021, the Company exercised its right to
terminate the
Zia
Agreement and Convertible Note. As such, as of
 
December 31, 2021
, no drawdowns were made on the Zia Agreement and the principal amount on the Convertible Note is $Nil (December 31, 2020
—
$Nil).
Mutual Termination of Acquisition
In September 2019, the Company, through its wholly owned subsidiary, iA Northern Nevada, Inc., entered into an agreement to acquire WSCC Inc. (“Sierra Well”), subject to regulatory approval. Sierra Well operates two dispensaries, two cultivation facilities and one processing facility in Nevada.
On July 31, 2020, the Company and Sierra Well announced the mutual termination of the merger agreement previously announced in September 2019. As a result of the prolonged timeline to achieve the necessary conditions to close combined with the adverse market conditions surrounding the industry and broader economy, the Company and Sierra Well agreed that it was in the best of interest of both parties to terminate the transaction.