TORONTO, May 02, 2018 (GLOBE NEWSWIRE) -- Cyrus Capital Partners, L.P. (“CCP”) announces that FBC Holdings S.à r.l. (“FBC”), an investment fund managed by CCP, has acquired an additional 488,543 common shares (“Common Shares”) of Sphere 3D Corporation (“Sphere 3D”). On April 30, 2018, 141,845 Common Shares were issued to FBC in lieu of an interest payment of $96,498.58 (US$75,178.08) due on the 8% senior secured convertible debenture in the principal amount $24,500,000 issued by Sphere 3D to FBC (the “Debenture”). In addition, 346,698 Common Shares were issued to FBC in lieu of a payment in the amount of $235,861.50 (US$183,750) due as consideration for FBC’s entering into an amendment to the Debenture. The 488,543 Common Shares acquired by FBC on April 30, 2018 represent approximately 3.55% of the 13,748,744 issued and outstanding Common Shares of Sphere 3D as at such date (the 13,748,744 is comprised of the 13,260,201 issued and outstanding shares as at April 23, 2018 as disclosed in Sphere 3D’s management information circular filed on April 27, 2018, plus the 488,543 Common Shares issued to FBC on April 30, 2018).
Immediately before April 30, 2018, CCP, through the FBC had indirect control over 1,216,976 Common Shares. CCP also had indirect control over 40,000 Warrants held by FBC and the Debenture that is convertible into 326,667 Common Shares. If FBC were to have converted the Debenture and the Warrants, FBC would have held and CCP would have indirectly controlled, on a partially diluted basis, an aggregate of 1,583,643 Common Shares, or approximately 11.62% of the issued and outstanding Common Shares. This is calculated on the basis that there would have been 13,626,868 Common Shares of Sphere 3D issued and outstanding (comprised of the then issued 13,260,201 Common Shares, plus the 326,667 Common Shares issuable on the conversion of the Debenture and the 40,000 Common Shares issuable on the conversion of the Warrants).
After the April 30 transaction, CCP, through FBC has indirect control over 1,705,519 Common Shares. CCP also has indirect control over 40,000 Warrants held by FBC and the Debenture that is convertible into 326,667 Common Shares. If FBC were to have converted the Debenture and the Warrants, FBC and the Funds would have held and CCP would have indirectly controlled, on a partially diluted basis, an aggregate of 2,072,186 Common Shares, or approximately 14.68% of the issued and outstanding Common Shares. This is calculated on the basis that there were 14,115,411 Common Shares of Sphere 3D issued and outstanding on April 30, 2018 (comprised of the then issued 13,260,201 Common Shares, plus the 326,667 Common Shares issuable on the conversion of the Debenture, the 40,000 Common Shares issuable on the conversion of the Warrants and the 488,543 Common Shares issued to FBC on April 30, 2018).
FBC is a joint actor in connection with the disclosure required by this press release.
Other Information
CCP acquired indirect control over, and FBC and the Funds acquired ownership of, the Common Shares that are the subject of this report for investment purposes.
None of CCP or FBC has any current plans or future intentions which relate to or would result in any of the events, transactions or circumstances enumerated in paragraphs (a) - (k) of Item 5 of the “early warning” report on Form 62-103F1 being filed in connection with the matters disclosed in this release. Notwithstanding this, in connection with the investment by FBC in the Common Shares, CCP may engage in communications with members of management and the board of directors of Sphere 3D, other current or prospective shareholders, industry analysts, existing or potential strategic partners or competitors, investment and financing professionals, sources of credit and other investors with respect to Sphere 3D. CCP intends to review FBC’s investment in Sphere 3D on a continuing basis. Depending on various factors including, without limitation, Sphere 3D’s financial position, the price levels of the Common Shares, conditions in the securities markets and general economic and industry conditions, CCP’s or FBC’s business or financial condition and other factors and conditions CCP deems appropriate, FBC may in the future take such actions with respect to their investment in Sphere 3D as CCP deems appropriate including, without limitation, seeking additional board representation, making proposals to Sphere 3D concerning changes to the capitalization, ownership structure or operations of Sphere 3D, acquiring additional Common Shares, and/or selling or otherwise disposing of some or all of their Common Shares. In addition, CCP may formulate other purposes, plans or proposals regarding Sphere 3D or any of its securities to the extent deemed advisable in light of general investment and trading policies, market conditions or other factors or may change its intention with respect to any and all matters referred to in Item 5 of the “early warning” report on Form 62-103F1 being filed in connection with the matters disclosed in this release.
FBC is a joint actor in connection with the disclosure required by this press release. Except as specifically indicated in this press release, neither the issuance of this press release in connection with the matters disclosed herein nor the anticipated filing by CCP of the corresponding “early warning” report on Form 62-103F1 required to be filed in accordance with applicable Canadian securities laws is an admission that an entity named or otherwise referred to in this press release owns or controls any described securities or is a joint actor with another entity named or otherwise referred to in this press release.
CCP’s address and other contact information is set forth below. For further information, including to obtain a copy, once filed, of the “early warning” report on Form 62-103F1 being filed connection with the matters disclosed in this release in accordance with applicable Canadian securities laws, contact CCP at the address specified below. CCP was formed under the laws of Delaware and is an SEC registered investment adviser.
Cyrus Capital Partners, L.P.
65 East 55th Street, 35th Floor
New York, NY 10022
United States of America