/NOT FOR DISSEMINATION IN THE UNITED STATES OR FOR DISTRIBUTION TO U.S.
WIRE SERVICES/
WINNIPEG, April 4, 2018 /CNW/ - DELTA 9 CANNABIS INC.
(TSXV: NINE) ("Delta 9" or the "Company") is pleased to announce
that it has exercised its option to purchase the land and 80,000
square foot building containing the Company's current cannabis
production facility (the "Property") for a price of $6.25 million, subject to certain closing
adjustments and conditions. Delta 9 previously announced on
March 21, 2018 that it had entered
into a five-year lease of the Property which contained an option to
purchase and that Delta 9 anticipated quickly exercising such
option.
Delta 9 has entered into a formal option agreement (the "Option
Agreement") with 6599362 Canada Ltd. (the "Vendor") which sets
forth the terms of the acquisition of the Property. The Option
Agreement also provides that on closing of the acquisition of the
Property, Delta 9 will purchase certain cannabis production
equipment (the "Equipment") currently leased from the Vendor
pursuant to certain lease agreements for a price of $952,000, plus applicable taxes.
The Vendor is a non-arm's length party of Delta 9 due to the
fact that a director of Delta 9, Joanne
Duhoux-Defehr, is also a director of the Vendor and is the
owner of 20 per cent of the issued and outstanding shares of the
Vendor. Accordingly, the acquisition of the Property and the
Equipment are considered to be a non-arm's length party transaction
and will be subject to the approval of the TSX Venture Exchange
(the "Exchange"). The Exchange will require Delta 9 to provide
evidence of the value of the Property and Equipment to the Exchange
to support the purchase price being paid by Delta 9 as well as
certain other information. Closing is also subject to the
completion of satisfactory due diligence by Delta 9 as well as
certain other closing conditions.
As previously announced, the Property is located in a heavy
industrial area in Winnipeg,
Manitoba. The production facility of Delta 9 has been
located at the Property since July, 2013. Delta 9 has
made significant improvements to the Property to enable it to be
used as a cannabis cultivation facility. Management of Delta 9
believes that the acquisition of the Property will be positive for
Delta 9 as it will allow Delta 9 to obtain complete ownership and
control over its current cannabis production facility.
"Delta 9 has designed a highly efficient growing method through
the development of our proprietary Grow Pod technology, and by
purchasing the property we will be able to custom design and build
structures that are ideally suited to house our cannabis Grow
Pods," says CEO John Arbuthnot.
"This land purchase would not only secure our current expansion
to 17,500 kilograms of cannabis annually, but would also secure our
long term expansion on the same property."
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 80,000
square foot production facility in Winnipeg, Manitoba, Canada. Delta 9 was the
fourth company in Canada licensed
to produce legal cannabis. Delta 9's shares trade on the TSX
Venture Exchange under the symbol "NINE".
Neither the TSX Venture Exchange nor its Regulation
Services Provider (as that term is defined in the policies of the
TSX Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release.
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 closing of the acquisition of the Property by Delta 9 and
Exchange approval for such acquisition. 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 that Delta 9's currently
contemplated expansion and development plans may cease or otherwise
change, Delta 9's production of cannabis may be lower than
expected, Delta 9 may not obtain the required approvals from Health
Canada, demand for Delta 9's products may be lower than
anticipated, Delta 9's cost to produce its grow pods may be higher
than expected and all other risk factors set forth in the filing
statement of Delta 9 dated October 25,
2017 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.
SOURCE Delta 9 Cannabis Inc.