Delta 9 Cannabis (TSXV:NINE) announced it exercises its option to purchase the land and 80,000 square foot building containing its current cannabis production facility for a price of $6.25 million.
As quoted in the press release:
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.