Wildflower Announces Closing of Private Placement

Wildflower Brands Inc. (CSE: SUN) (the “Company”) announces that it has completed its two previously announced concurrent private placement financings (the “Offerings”). A total of $4,612,466 was raised through the issuance of a combination of 3,561,202 subscription receipts (“Subscription Receipts”) and 3,534,898 units of the Company. Equity markets have been presenting challenging conditions for cannabis-related businesses recently, but the successful raise of the funds will allow the Company to:

Complete the acquisition of City Cannabis Corp. (“City Cannabis”), which has two operating retail cannabis stores.
Complete City Cannabis renovations to open two new retail cannabis stores in July 2019. With combined revenues in excess of $1.5 Million in the last month, Wildflower expects to have a solid cash flow base for continued expansion following the closing.
Complete the buildout of its Washington manufacturing facilities for Wildflower Wellness hemp CBD-infused products in order to expand production more than tenfold.
Target additional major retail chains following the Company’s successful launch at Dillard’s department store chain this month.
Continue European and other international expansion.
The Offerings were comprised of a brokered offering of Subscription Receipts (the “Brokered Offering”), which was led by Industrial Alliance Securities Inc. (the “Lead Agent”) and Sprott Capital Partners LP by its general partner, Sprott Capital Partners GP (together, the “Agents”), and a non-brokered offering (the “Non-Brokered Offering”) of units (each, a “Non-Brokered Unit”). The Subscription Receipts were issued pursuant to a subscription receipt agreement dated June 25, 2019, (the “Subscription Receipt Agreement”) between the Company, the Lead Agent and Odyssey Trust Company (“Odyssey”). Each Subscription Receipt is convertible, without additional consideration, into a unit of the Company (each, a “Subscription Unit”) upon completion of the Company’s proposed acquisition of City Cannabis and the satisfaction of the other escrow release conditions (the “Escrow Release Conditions”) set out in the Subscription Receipt Agreement. Each Subscription Unit and Non-Brokered Unit (together, the “Units”) consists of one common share and one warrant (each, a “Warrant”). Each Warrant entitles the holder to purchase one common share in the capital of Wildflower at a price of $0.65 per common share until 24 months after the satisfaction of the Escrow Release Conditions, subject to rights of adjustment and mandatory exercise in certain events, as set out in the warrant indenture governing the Warrants issued under the Brokered Offering and the warrant certificates governing the Warrants issued under the Non-Brokered Offering.

The net proceeds raised in connection with the Brokered Offering, after fees and expenses incurred, and less 50% of the Agents’ Fee (as defined below), have been deposited with Odyssey, as subscription receipt agent. The escrowed proceeds will be held by Odyssey until the Escrow Release Conditions have been satisfied.

In connection with the Offering, the Agents are entitled to receive (i) a cash commission equal to 7% of the aggregate proceeds of the portion of the Brokered Offering sold to subscribers sourced by the Agents, (ii) a cash commission equal to 3% of the aggregate proceeds from subscribers participating in the Non-Brokered Offering (together, the “Agents’ Fee”). The Agents have also received an aggregate number of compensation options (the “Compensation Options”) equal to 7% of the number of Subscription Units issued to subscribers sourced by the Agents, and an aggregate number of Compensation Options equal to 3% of the number of the Non-Brokered Units issued to subscribers participating in the Non-Brokered Offering. Each Compensation Option entitles the holder to one unit (an “Agents’ Unit”), at an exercise price of $0.65 per Agents’ Unit for a period of 24 months following the date of the satisfaction of the Escrow Release Conditions. Each Agents’ Unit shall be comprised of one common share of the Corporation and one warrant (each, an “Agents’ Warrant”) entitling such holder to purchase one common share in the capital of the Corporation (each, an “Agents’ Warrant Share”), exercisable for a period of 24 months following the date of the satisfaction of the Escrow Release Conditions, at an exercise price of $1.00 per Agents’ Warrant, subject to adjustments in certain circumstances. Upon closing of the Offering, 50% of the Agents’ Fee was paid to the Agents with the remainder to be paid upon satisfaction of the Escrow Release Conditions.

ABOUT WILDFLOWER BRANDS

Wildflower Brands is a Vancouver-based company developing and designing brands that focus on plant-based health and wellness products. All of our brands work in synergy toward the goal of becoming a global wellness leader.

On Behalf of the Board of Directors

“William MacLean”
____________________________________
William MacLean
Director and CEO

Cautionary and Forward-Looking Statements

This news release contains forward‐looking statements and forward‐looking information within the meaning of applicable securities laws. These statements relate to future events or future performance. All statements other than statements of historical fact may be forward‐looking statements or information. Forward‐looking statements and information are often, but not always, identified by the use of words such as “appear”, “seek”, “anticipate”, “plan”, “continue”, “estimate”, “approximate”, “expect”, “may”, “will”, “project”, “predict”, “potential”, “targeting”, “intend”, “could”, “might”, “should”, “believe”, “would” and similar expressions.

Forward-looking statements and information are provided for the purpose of providing information about the current expectations and plans of management of the Company relating to the future. Readers are cautioned that reliance on such statements and information may not be appropriate for other purposes, such as making investment decisions. Since forward‐looking statements and information address future events and conditions, by their very nature they involve inherent risks and uncertainties. Actual results could differ materially from those currently anticipated due to a number of factors and risks. These include, but are not limited to, the use of proceeds of the Offerings, the release of the proceeds of the Brokered Offering from escrow, the conversion of the Subscription Receipts to Subscription Units, the opening of new cannabis retail stores and the buildout of the Washington manufacturing facilities. Accordingly, readers should not place undue reliance on the forward‐looking statements, timelines and information contained in this news release. Readers are cautioned that the foregoing list of factors is not exhaustive.

The forward‐looking statements and information contained in this news release are made as of the date of this news release and no undertaking is given to update publicly or revise any forward‐looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws or the CSE. The forward-looking statements or information contained in this news release are expressly qualified by this cautionary statement.

The Canadian Securities Exchange Inc. has in no way passed upon the merits of the proposed transaction and has neither approved nor disapproved of the contents of this press release.

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Source: www.globenewswire.com