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VANCOUVER, March 8, 2019 /CNW/ - SpeakEasy Cannabis Club Ltd. (CSE: EASY) (Frankfurt: 39H) (the "Company" or "SpeakEasy") is pleased to announce that it has closed its previously announced non-brokered private placement (the "Private Placement") for deemed aggregate gross proceeds of $8,250,000. The Private Placement consisted of the issuance of 16,500,000 units of the Company (the "Units") at a price of $0.50 per Unit.
Each Unit consists of one common share in the capital of the Company (a "Common Share") and one-half of one Common Share purchase warrant (each whole warrant, a "Warrant"). Each Warrant will entitle the holder thereof to acquire an additional Common Share at a price of $1.00 for a period of 24 months from closing.
In connection with the completion of the Private Placement, the Company paid a cash finders fee of $122,500 and issued 245,000 non-transferable broker warrants (the "Broker Warrants"). Each Broker Warrant entitles the holder to acquire one Common Share at an exercise price of $0.50 per share for a period of 24 months following closing.
929,242 Units, representing $464,621 of the gross proceeds from the Private Placement, were issued to certain of the Company's creditors in satisfaction of outstanding debt obligations. It is anticipated that the net proceeds of the Private Placement will be used for working capital and general corporate purposes.
The securities issued by the Company under the Private Placement are subject to restrictions on resale in accordance with applicable securities laws. These restrictions will expire on July 9, 2019. The Private Placement is subject to final acceptance by the Canadian Securities Exchange (the "CSE").
Certain insiders of the Company participated in the Private Placement and were also creditors who received Units in satisfaction of their outstanding debt. An aggregate of 960,000 Units were issued to such insiders. The participation of insiders of the Company constitutes a related party transaction as defined under Multilateral Instrument 61-101 - Protection of Minority Security Holders in Special Transactions ("MI 61-101"). Because the Common Shares trade only on the CSE, the issuance of securities is exempt from the formal valuation requirements of Section 5.4 of MI 61-101 pursuant to Subsection 5.5(b) of MI 61-101 and exempt from the minority approval requirements of Section 5.6 of MI 61-101. The Company did not file a material change report 21 days prior to the closing of the private placement as the details of the participation of insiders of the Company had not been confirmed at that time.
About SpeakEasy Cannabis Club Ltd.:
SpeakEasy is a late stage applicant under the Access to Cannabis for Medical Purposes Regulations (the "ACMPR") that is seeking to leverage three generations of farming experience in B.C. to produce high quality, small batch cannabis products once it obtains a license to do so. The Company currently owns 290 acres of land in Rock Creek, British Columbia. The Company's 10,000 square foot indoor facility will allow for the growth, production, and cultivation of small batch cannabis if and when the Company obtains a license from Health Canada. Construction has also commenced on an 80,000 square foot expansion facility. Completion for the expansion is projected for Q1 2019.
For more information visit: https://speakeasygrowers.com/
Statement Regarding Forward-Looking Information
This news release contains statements that constitute "forward-looking statements." Such forward looking statements involve known and unknown risks, uncertainties and other factors that may cause SpeakEasy's actual results, performance or achievements, or developments in the industry to differ materially from the anticipated results, performance or achievements expressed or implied by such forward-looking statements. Forward looking statements are statements that are not historical facts and are generally, but not always, identified by the words "expects," "plans," "anticipates," "believes," "intends," "estimates," "projects," "potential" and similar expressions, or that events or conditions "will," "would," "may," "could" or "should" occur.
Forward-looking statements in this document include statements concerning SpeakEasy's anticipated use of proceeds from the Private Placement, its intent to obtain a license under the ACMPR, its intent to produce and sell high quality craft cannabis once it receives a license from Health Canada, its intention to complete construction of its expansion facility and the timeframe within which the construction of such facility will be completed and all other statements that are not statements of historical fact.
Although SpeakEasy believes the forward-looking information contained in this news release is reasonable based on information available on the date hereof, by their nature forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause our actual results, performance or achievements, or other future events, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. By their nature, these statements involve a variety of assumptions, known and unknown risks and uncertainties and other factors, which may cause actual results, levels of activity and achievements to differ materially from those expressed or implied by such statements.
Examples of such assumptions, risks and uncertainties include, without limitation, assumptions, risks and uncertainties associated with general economic conditions; adverse industry events; future legislative and regulatory developments involving cannabis; the Company's ability to access sufficient capital from internal and external sources, and/or inability to access sufficient capital on favorable terms; the cannabis industry in Canada and generally; the ability of SpeakEasy to implement its business strategies; competition; the ability of SpeakEasy to obtain all applicable licenses under the ACMPR and other assumptions, risks and uncertainties.
THE FORWARD-LOOKING INFORMATION CONTAINED IN THIS NEWS RELEASE REPRESENTS THE EXPECTATIONS OF THE COMPANY AS OF THE DATE OF THIS NEWS RELEASE AND, ACCORDINGLY, IS SUBJECT TO CHANGE AFTER SUCH DATE. READERS SHOULD NOT PLACE UNDUE IMPORTANCE ON FORWARD-LOOKING INFORMATION AND SHOULD NOT RELY UPON THIS INFORMATION AS OF ANY OTHER DATE. WHILE THE COMPANY MAY ELECT TO, IT DOES NOT UNDERTAKE TO UPDATE THIS INFORMATION AT ANY PARTICULAR TIME EXCEPT AS REQUIRED IN ACCORDANCE WITH APPLICABLE LAWS.
The Canadian Securities Exchange has not approved nor disapproved the contents of this news release.
SOURCE Speakeasy Cannabis Club Ltd.
For further information: Marc Geen, CEO, email@example.com, 1-250-449-1773