WINNIPEG, Aug. 14, 2019 /CNW/ - DELTA 9 CANNABIS INC.
(TSX-V: DN) (OTCQX: VRNDF) ("Delta 9" or the "Company") is pleased
to announce that it has come to terms on an amendment to the
Company's borrowing arrangement with Canadian Western Bank (the
"Bank") to provide for an increase to its existing loan and credit
facility by the addition of certain loan segments and amendments to
certain existing loan segments. The changes will bring the
Company's total credit facility with the Bank to approximately
$18.19 Million.
"This increased debt financing, together with our recently
completed short form prospectus offering of debenture units have
well-positioned us to continue the Company's growth and
implementation of its business plan for the remainder of the year,"
said Delta 9 CEO John Arbuthnot.
The Company announced the terms of its financing arrangements
with the Bank on July 24, 2018 (the
"Original Financing"). The principal terms of the amendment to the
Original Financing provide for the following:
- The limit for the demand operating loan under the Original
Financing, for the purpose of financing day-to-day operations of
the Company, will increase to $4,000,000 from its limit of $2,000,000 under the Original Financing. The
interest rate under this loan segment is unchanged from its rate
under the Original Financing at 1.00% per annum above the Bank's
prime lending rate.
- A credit facility in the amount of $500,000 for the purpose of enabling the delivery
of letters of credit required in connection with the Company's
operations is added.
- A non-revolving credit facility in the amount of $4,000,000 for the purchase or lease of equipment
required for the operation of the Company's business is added, with
interest to float at a rate of 1.70% above the Bank's prime lending
rate, with fixed rate pricing to be the subject of negotiation up
to the date of drawdown.
- The principal amounts of a demand non-revolving loan and a
non-revolving equipment credit facility under the Original
Financing have been reduced to reflect repayment of principal that
was made by the Company since the date of the Original
Financing.
"The relationship between our Company and the Bank since the
date of the Original Financing has grown steadily, and the proposed
terms for these amendments demonstrate the strength of our mutual
trust. We have watched Canadian financial institutions becoming
more comfortable with the cannabis industry each day, and our
experience with the Bank over the past year is a testament to the
mutual benefits that can follow from collaboration between the two
industries," said Arbuthnot.
The availability of the amended financing arrangements with the
Bank is conditional on the Bank's satisfactory due diligence of the
Company and finalization of documentation relating to the
arrangement.
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. 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 TSX Venture Exchange under the symbol "DN" and on the OTCQX
under the symbol "VRNDF". For more information, please visit
www.delta9.ca.
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: (i) the eventual availability of the
amended financing arrangements; and (ii) the Company's growth and
implementation of its business plan. 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 the Bank may not be
satisfied with its due diligence review of the Company, the Company
and the Bank may not be able to agree on the final documentation to
reflect to amended financing arrangements as well as the
risk factors set forth in the annual information form of Delta 9
dated April 30, 2019 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.
