WINNIPEG, Manitoba, June 01, 2020 (GLOBE NEWSWIRE) -- DELTA 9 CANNABIS INC. (DN.TO) (VRNDF) (“Delta 9” or the “Company”), is pleased to announce that on May 29, 2020 it closed a transaction with Modern Leaf Group Inc. ("Modern Leaf") to acquire all or substantially all of Modern Leaf’s assets located in the Province of Alberta relating to two retail cannabis stores located in Calgary, Alberta and Grande Prairie, Alberta (the "Transaction"). The acquisition is being completed through the Company’s wholly-owned subsidiary, Delta 9 Cannabis Store Inc., and pursuant to the previously announced purchase agreement among Delta 9 Cannabis Store Inc., Modern Leaf and Mr. Preston Drummond dated November 21, 2019 (the “Agreement”). Kronos Capital Partners advised Modern Leaf in regards to the transaction.
"We are pleased to have finalized our transaction with Modern Leaf and look forward to the first Delta 9 Cannabis Stores opening their doors in the province of Alberta in short order," said John Arbuthnot, CEO of Delta 9. "This is another milestone for us in our goal of creating one of Canada’s preeminent vertically integrated cannabis companies."
The purchase price paid by Delta 9 Cannabis Store Inc. relating to the Transaction was $1,300,000, subject to customary adjustments (the "Purchase Price"). $1,000,000 of the Purchase Price was satisfied through the issuance of 1,250,000 common shares in the capital stock of the Company (each a "Common Share"), a price per Common Share of $0.80 based on the closing market price of the Common Shares on the Toronto Stock Exchange on September 19, 2019, such date being the date that the Company and Modern Leaf entered into a previously announced binding letter of intent with respect to the Proposed Transaction. The balance of the Purchase Price was paid by way of the release of the $150,000 deposit in respect of the transaction, and the payment of $150,000, satisfied in cash.
Upon the closing of the Transaction under the Agreement, Delta 9 Cannabis Store Inc. and Modern Leaf entered into additional agreements effective at the date of closing providing for, among other things, the granting of a right of first refusal by Modern Leaf in favour of Delta 9 Cannabis Store Inc. pertaining to the purchase of a retail cannabis store located in Olds, Alberta and the granting of certain restrictive covenants by Modern Leaf in favour of Delta 9 Cannabis Store Inc.
The final closing of the Transaction remains subject to the approval of the Toronto Stock Exchange.
For more information contact:
Investor & Media Contact:
Ian Chadsey VP Corporate Affairs
About Delta 9 Cannabis Inc.
Delta 9 Cannabis Inc. is a vertically integrated cannabis company focused on bringing the highest quality cannabis products to market. The company sells cannabis products through its wholesale and retail sales channels and sells its cannabis grow pods to other businesses. Delta 9's wholly-owned subsidiary, Delta 9 Bio-Tech Inc., is a licensed producer of medical and recreational cannabis and operates an 80,000 square foot production facility in Winnipeg, Manitoba, Canada. Delta 9 owns and operates a chain of retail stores under the Delta 9 Cannabis Store brand. Delta 9's shares trade on the Toronto Stock Exchange under the symbol "DN" and on the OTCQX under the symbol "VRNDF". For more information, please visit www.delta9.ca.
Disclaimer for Forward-Looking Information
Certain statements in this release are forward-looking statements, which reflect the expectations of management regarding the Company’s future business plans and other matters. Forward-looking statements consist of statements that are not purely historical, including any statements regarding beliefs, plans, expectations or intentions regarding the future. Forward looking statements in this news release include statements relating to the Company's potential expansion plans; and (ii) all necessary regulatory approvals for the Transaction being obtained. Such statements are subject to risks and uncertainties that may cause actual results, performance or developments to differ materially from those contained in the statements, including the risk that the necessary regulatory approvals are not obtained as well as all risk factors set forth in the annual information form of Delta 9 dated March 19, 2020 which has been filed on SEDAR. No assurance can be given that any of the events anticipated by the forward-looking statements will occur or, if they do occur, what benefits the Company will obtain from them. Readers are urged to consider these factors carefully in evaluating the forward-looking statements contained in this news release and are cautioned not to place undue reliance on such forward-looking statements, which are qualified in their entirety by these cautionary statements. These forward-looking statements are made as of the date hereof and the Company disclaims any intent or obligation to update publicly any forward-looking statements, whether as a result of new information, future events or results or otherwise, except as required by applicable securities laws.