DN:CC - Delta 9 Announces Receipt of Demand Letter from SNDL Inc. and Creation of Independent Board Committee to Review Strategic Transactions
(TheNewswire)
WINNIPEG, MB – TheNewswire - May 24, 2024 – DELTA 9 CANNABIS INC. (TSX:DN)(OTC:DLTNF) (“ Delta 9 ” or the“ Company ”) announcestoday that is has received a letter (the “ Demand Letter ”)from SNDL Inc. (“ SNDL ”) demanding repayment of its 10% seniorsecured second-lien convertible debenture (the “ Convertible Debenture ”) in the principal amount of $10,000,000, all outstandinginterest thereon, and any other costs or amounts recoverable inconnection therewith. In the Demand Letter, SNDL alleges that Delta 9is in default of certain obligations under the Convertible Debentureand related financing documents (collectively, the “ Financing Documents ”).
Delta 9 has reviewed the Demand Letter and hasconcluded that it is not in default of its obligations under theFinancing Documents. Delta 9 notes that none of the alleged defaultsin the Demand Letter are for failure to make required payments ofprincipal or interest and Delta 9 remains current with all requiredpayments to SNDL. Prior to receipt of the Demand Letter, SNDL hadrequested certain concessions from Delta 9 relating to the FinancingDocuments that Delta 9 was not willing to agree to.
At this time Delta 9 also wishes to announce that ithas formed an independent committee of its board of directors toexamine various potential strategic transactions for Delta 9, whichmay include, without limitation, mergers, acquisitions, asset sales orfinancings. To date, Delta 9 has had discussions with various partieswith respect potential strategic transactions. There can be noassurance that any of these discussions will result in a bindingagreement or the completion of a transaction. No further detailsregarding such discussions, including the identity of any potentialcounterparty, will be disclosed at this time.
Delta 9 believes that the timing of the Demand Letteris related to SNDL becoming aware of the discussions that Delta 9 hashad with various counterparties with respect to potential strategictransactions. Through delivery of the Demand Letter, SNDL may beattempting to insert itself into that process and potentially affectthe outcome thereof. Notwithstanding the delivery of the DemandLetter, Delta 9 intends to continue to actively explore a broad rangeof strategic alternatives to maximize shareholder value. There can beno assurance that this process will result in any binding agreementsor the completion of any transactions.
For more information contact:
Investor & MediaContact:
Ian Chadsey VP CorporateAffairs
Mobile :204-898-7722
E-mail: ian.chadsey@delta9.ca
No securities regulatory authority has either approvedor disapproved of the contents of this press release. This pressrelease is for information purposes only and does not constitute anoffer to sell or the solicitation of an offer to buy the securities ofDelta 9, nor shall there be any sale of these securities in any stateor jurisdiction in which such offer, solicitation or sale would beunlawful prior to registration or qualification under the securitieslaws of any such state or jurisdiction.
About Delta 9 Cannabis Inc.
Delta 9 Cannabis Inc. is a vertically integratedcannabis company focused on bringing the highest quality cannabisproducts to market. The Company sells cannabis products throughits wholesale and retail sales channels and sells its cannabis growpods to other businesses. Delta 9 ’s wholly-owned subsidiary,Delta 9 Bio-Tech Inc., is a licensed producer of medical andrecreational cannabis and operates a 95,000 square foot productionfacility in Winnipeg, Manitoba,Canada . Delta 9 ownsand operates a chain of retail stores under the Delta 9 Cannabis Store brand. Delta 9 ’s shares trade on the TorontoStock Exchange under the symbol “DN” and on the OTC under thesymbol “DLTNF”. For more information, please visit www.delta9.ca.
Disclaimer forForward-Looking Information
Certain statements in this releaseare forward-looking statements, which reflect the expectations ofmanagement regarding the Company’s future business plans and other matters.Forward-looking statements consist of statements that are not purelyhistorical, including any statements regarding beliefs, plans,expectations or intentions regarding the future. Such statements aresubject to risks and uncertainties that may cause actual results,performance or developments to differ materially from those containedin the statements, including with respect to the issues between Delta9 and SNDL, any strategic transaction undertaken by Delta 9 as well asall risk factors set forth in the annual information form of Delta9 dated March 28,2024 which has been filed on SEDAR. No assurance can be given thatany of the events anticipated by the forward-looking statements willoccur or, if they do occur, what benefits the Company will obtain fromthem. Readers are urged to consider these factors carefully inevaluating the forward-looking statements contained in this newsrelease and are cautioned not to place undue reliance on suchforward-looking statements, which are qualified in their entirety bythese cautionary statements. These forward-looking statements are madeas of the date hereof and the Company disclaims anyintent or obligation to update publicly any forward-lookingstatements, whether as a result of new information, future events orresults or otherwise, except as required by applicable securitieslaws.
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