Zenabis Announces Closing of Public Offering of Units

– Zenabis Global Inc. (TSX: ZENA)(“Zenabis” or the “Company“) is pleased to announce the closing of the previously announced overnight marketed offering of units of Zenabis (“Units“), including the exercise in part of the over-allotment option (together, the “Offering“). Pursuant to the Offering, the Company sold 89,317,747 Units at a price of $0.085 per Unit for aggregate gross proceeds of $7,592,008.50. Each Unit consisting of a common share of the Company (each, a “Common Share“) and one common share purchase warrant (each, a “Warrant“) to purchase a Common Share at a price of $0.10 for a period of 60 months following the closing date of the Offering.  In the event that the closing price of the Common Shares on the Toronto Stock Exchange, or such other principal exchange on which the Common Shares are then trading, is greater than $0.20 per Common Share for a period of ten consecutive trading days at any time after the closing of the Offering, the Company may accelerate the expiry date of the Warrants by giving written notice to the holder thereof and in such case the Warrants will expire on the 15th day after the date on which such notice is given by the Company.

The Offering was made pursuant to an agency agreement dated September 18, 2020 (the “Agency Agreement“) between the Company and a syndicate of agents led by ATB Capital Markets Inc. and including Eight Capital (together, the “Agents“). Pursuant to the Agency Agreement, the Company paid the Agents a cash commission equal to 6.0% of the gross proceeds of the Offering and issued the Agents 5,359,064 common share purchase warrants (each, a “Broker Warrant“), with each Broker Warrant entitling the Agents to purchase an additional Common Share at a price of $0.085 for a period of 12 months from the date hereof.

The Offering was made by way of a prospectus supplement dated September 18, 2020 to the Company’s short form base shelf prospectus dated April 9, 2019.

Zenabis intends to use the net proceeds of the Offering for general working capital and corporate purposes and the partial repayment of the Company’s unsecured convertible debentures. The Company intends to prepay debt in accordance with the below table:

DebtOpening
Principal
Paydown
Amount
Remaining
Principal
Maturity Date
Unsecured Convertible
Debentures
$7,700,000$3,850,000$3,850,000September 2021

About Zenabis

Zenabis is a significant Canadian licensed cultivator of medical and recreational cannabis, and a propagator and cultivator of floral and vegetable products. Zenabis employs staff coast-to-coast, across facilities in Atholville, New Brunswick; Aldergrove, Pitt Meadows and Langley, British Columbia; and Stellarton, Nova Scotia. Zenabis currently has 111,200 kg of licensed cannabis cultivation space across four licensed facilities. Zenabis has 3.5 million square feet of total facility space dedicated to a mix of cannabis production and cultivation and its propagation and floral business.

Zenabis expects Zenabis Stellarton and Zenabis Langley facilities to join Zenabis Atholville in steady state production in 2020. The Zenabis brand name is used in the cannabis medical market, the Namaste, Blazery, and Re-Up brand names are used in the cannabis adult-use recreational market.

Forward Looking Information

This news release contains statements that may constitute “forward-looking information” within the meaning of applicable Canadian securities legislation. Forward-looking information may include, among others, statements regarding the future plans, costs, objectives or performance of Zenabis, or the assumptions underlying any of the foregoing. In this news release, words such as “may”, “would”, “could”, “will”, “likely”, “believe”, “expect”, “anticipate”, “intend”, “plan”, “estimate” and similar words and the negative form thereof are used to identify forward-looking statements. In this news release, forward-looking statements relate, among other things, to: statements with respect to the expected use of the net proceeds from the Offering. Forward-looking statements should not be read as guarantees of future performance or results, and will not necessarily be accurate indications of whether, or the times at or by which, such future performance will be achieved. No assurance can be given that any events anticipated by the forward-looking information will transpire or occur. Forward-looking information is based on information available at the time and/or management’s good-faith belief with respect to future events and are subject to known or unknown risks, uncertainties, assumptions and other unpredictable factors, many of which are beyond Zenabis’ control. These risks, uncertainties and assumptions include, but are not limited to, those described in the Shelf Prospectus, a copy of which is available on SEDAR at www.sedar.com and could cause actual events or results to differ materially from those projected in any forward-looking statements. Furthermore, any forward-looking information with respect to available space for cannabis production is subject to the qualification that management of Zenabis may decide not to use all available space for cannabis production, and the assumptions that any construction or conversion would not be cost prohibitive, required permits will be obtained and the labour, materials and equipment necessary to complete such construction or conversion will be available. Accordingly, readers should not place undue reliance on the forward-looking statements and information contained in this news release. Zenabis does not intend, nor undertake any obligation, to update or revise any forward-looking information contained in this news release to reflect subsequent information, events or circumstances or otherwise, except if required by applicable laws.

For more information, visit: https://www.zenabis.com.

SOURCE NEWSWIRE

CANDLR ZENABIS

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