Nicholas Adams

Last week, Zevia raised $20m from GP Investments - Zevia is a public company so these private investments in public equity (e.g., PIPE) can give you an inside look as to how private equity deals get structured 👇 The deal: GP invests $20m into Zevia (NYSE: ZVIA) in the form of series A convertible preferred stock that converts at $1.448/share - a 20% premium to the current share price. $15m of this funds now, and $5m funds if FY26 revenue is over $172m. This is an intentional trade by ZVIA; they are getting a higher price in exchange for some preferred protections to GP, including: - 1.5x Liquidation preference: GP receives the greater of its as-converted share OR (keyword, or) 1.5x its $20m investment on liquidation - 6% dividend, compounding quarterly- paid in kind (PIK) - Consent rights; GP has to sign off on any senior securities, M&A, dividends - Put option; 4 years after close GP can force Zevia to buy back its shares at 1.5x what it paid. That imputes about 11%/yr return. If the stock returns greater than that, GP rationally will convert into equity. GP can also put early in some scenarios So essentially, this is a $20m check for 16% of the company; ~ $125m post money valuation (0.5x sales net of cash), for a brand forecasting $170m in sales in 2026. GP is then receiving lender-like downside protections with the option to cash in on upside like equity. Zevia maintains control of the company, but GP gets certain protections and rights that make it a heads i win tails i still kinda win deal.

HAIN CELESTIAL WEIGHS CHAPTER 11 AS STOCK DROPS 51% Hain Celestial is weighing a Chapter 11 filing, per Bloomberg. Shares fell 51% to $0.28, a ~$26M market cap and down 99% from the 2021 peak. The trigger: lenders didn't extend its December credit maturity by Oct 12. That was a condition of the $323M sale of its Ella's Kitchen-led international business to AURELIUS. Hain carries ~$500M of net debt against $1.35B of sales, which fell 13% last fiscal year. It has sold 8 brands since 2021, from Terra and Garden Veggie to ParmCrisps and Thinsters