CALGARY, April 19, 2018 /CNW/ – Westleaf Cannabis Inc. (“Westleaf” or the “Company”) is pleased to announce that it has closed a non-brokered private placement of approximately 25 million units (“Units”) at $0.50 per Unit for gross proceeds of approximately $12.5 million (the “Offering”). Each Unit consisted of one common share and one liquidity warrant. The Company intends to use the net proceeds from the Offering to fund Phase I of its cannabis cultivation facilities and prospective retail distribution locations in Alberta and Saskatchewan as well as for general corporate purposes.
Concurrently with closing the Offering, Westleaf entered into a limited partnership agreement (the “Limited Partnership Agreement”) with Delta 9 Cannabis Inc. (“Delta 9”) and Delta West Inc. (“Delta West”) for the joint development of a large-scale cannabis production facility located in Calgary, Alberta (the “Project”). Pursuant to the Limited Partnership Agreement, Delta West will act as the general partner and Westleaf and Delta 9 will be limited partners. Westleaf Cultivation Management II Inc., a wholly owned subsidiary of Westleaf, will act as manager of the general partner.
Westleaf and Delta 9 each own a 50% interest in the Project and will each initially contribute $3 million to the limited partnership which, together with debt financing, will be used for initial development of the Project. Delta 9 will provide certain cannabis genetics products to the Project. The Project is expected to be operational as early as the third quarter of 2018.
“Formalizing our partnership with Delta 9 is an important milestone for both our respective companies,” said Westleaf President and co-founder Scott Hurd. “This strategic partnership allows us to accelerate our growth plans to become a leader in cannabis in the Canadian Prairie region, with a vertically integrated presence across Alberta, Saskatchewanand Manitoba. Our goal is for the ‘Delta West’ facility located in Calgary, Alberta to be a world-class indoor cultivation, R&D, processing, extraction and fulfillment centre which will be capable of growing premium cannabis flower and producing a diversified derivative product offering to supply the Canadian and global markets.”
“We said last year we would be focusing heavily on expanding our footprint in the Prairie Provinces, and this partnership with Westleaf to build an Alberta facility is our biggest step yet in achieving that goal,” said Delta 9 CEO John Arbuthnot. “Westleaf has an excellent team in place, and combined with our experience and proprietary technology, I believe the Delta West facility will add great value for our shareholders as legalization of cannabis proceeds this summer.”
All information contained in this news release with respect to Westleaf and Delta 9 was supplied by the parties respectively, for inclusion herein, without independent review by the other party, and each party and its directors and officers have relied on the other party for any information concerning the other party.
About Westleaf Cannabis Inc. Westleaf is a private vertically integrated cannabis company headquartered in Calgary, Alberta. In addition to the Alberta Project, Westleaf is developing a cannabis production facility in Saskatchewan. Westleaf and its affiliates are pursuing retail distribution in both Alberta and Saskatchewan.
About Delta 9 Cannabis Inc. Delta 9’s wholly-owned subsidiary, Delta 9 Bio-Tech Inc., is a licensed producer of medical marijuana pursuant to the ACMPR and operates an approximately 80,000 square foot production facility in Winnipeg, Manitoba, Canada. Delta 9’s shares trade on the TSX Venture Exchange under the symbol “NINE”. www.delta9.ca
This news release contains forward-looking information within the meaning of securities laws. The use of any of the words “expect”, “anticipate”, “continue”, “estimate”, “objective”, “ongoing”, “may”, “will”, “project”, “should”, “believe”, “plans”, “intends” and similar expressions are intended to identify forward-looking information. In particular and without limitation, this news release contains forward-looking information concerning; the use of proceeds of the Offering; the development of a strategic alliance between the Company and Delta 9; the Project; the details and anticipated timing of the completion of the Project; the licensing of the Project; sales of cannabis produced by the Project; conditions required to complete the Project; the application for licenses to dispense cannabis products; and the future development plans of Westleaf, including the anticipated use of proceeds from the Offering. Although the Company believes in light of the experience of its officers and directors, current conditions and expected future developments and other factors that have been considered appropriate that the expectations reflected in this forward-looking information are reasonable, undue reliance should not be placed on them because the Company can give no assurance that they will prove to be correct. Readers are cautioned to not place undue reliance on forward-looking information. Since forward looking statements and information address future events and conditions, by their very nature they involve inherent risks and uncertainties. Actual results could differ materially from those currently anticipated due to a number of factors and risks. These include, but are not limited to, risks associated with general economic conditions; regulatory resistance in certain provinces to opening privately owned and operated recreational cannabis dispensaries; adverse industry events; marketing costs; loss of markets; future legislative and regulatory developments involving cannabis; inability to access sufficient capital from internal and external sources, and/or inability to access sufficient capital on favourable terms; the medical and potential cannabis industry in Canada generally; income tax and regulatory matters; the ability of the Company and/or Delta 9 to implement their business strategies; competition; crop failure; currency and interest rate fluctuations; and other risks. The Company cautions that the foregoing list of risks and uncertainties is not exhaustive. The forward-looking information contained in this news release are made as of the date hereof and the Company does not undertake any obligation to update publicly or revise any forward looking information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws. All information about Delta 9 contained in this news release has not been independently verified by the Company.
SOURCE Westleaf Cannabis Inc.
For further information: Scott Hurd, President & Chief Operating Officer, Westleaf Cannabis Inc., email@example.com, 403-870-4798