NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES FOR DISSEMINATION IN THE UNITED STATES
EDMONTON, Alberta and CALGARY, Alberta, Jan. 19, 2021 (GLOBE NEWSWIRE) -- Alcanna Inc. ("Alcanna") (TSX: CLIQ) and YSS Corp. ("YSS") (TSX-V: YSS; WCN: A2PMAX; and OTCQB: YSSCF) are pleased to announce that, as a result of excess demand, the previously announced $25.0 million equity financing being led by Eight Capital and Cormark Securities Inc. has been upsized to $40.0 million (the "Financing"). The Financing will be completed in connection with a transaction pursuant to which Alcanna will spin-out its retail cannabis business and combine with YSS to form "Nova Cannabis Inc." ("New Nova" or the "Company"), a new discount-focused cannabis retailer (the "Transaction"). In all other respects, the terms of the Transaction and the Financing will remain as previously disclosed in the January 18, 2021, press release other than the Agents’ option to offer for sale up to an additional 25% of the subscription receipts has been relinquished.
Closing of the Financing is expected to occur on or about February 5, 2021. The completion of the Financing is subject to customary closing conditions and regulatory approvals, including of the TSX Venture Exchange (the "TSXV").
Following the closing of the Transaction and assuming completion of the Financing for $40.0 million, it is anticipated that Alcanna will hold approximately 63%, current YSS shareholders will hold approximately 13% and new subscribers under the Financing will hold approximately 24% of the shares of New Nova, respectively, calculated on a basic basis.
Alcanna is one of the largest private sector retailers of alcohol and cannabis in North America and the largest in Canada by number of stores – operating 238 locations in Alberta and British Columbia. Alcanna is incorporated under the laws of Canada, and its common shares and convertible subordinated debentures trade on the Toronto Stock Exchange under the symbols "CLIQ" and "CLIQ.DB", respectively. Additional information about Alcanna is available at www.sedar.com and www.alcanna.com.
Alcanna Cannabis Stores GP Inc. ("ACS GP") and Alcanna Cannabis Stores Limited Partnership ("ACS LP" and together with ACS GP, the "ACS Entities") were formed in 2018 to leverage Alcanna's retail experience and expertise to become an industry leader in the Canadian retail cannabis industry with a strategy to independently open and develop its stores to increase its presence in the recreational retail cannabis market. The ACS Entities are operated primarily from Alcanna's head office in Edmonton, Alberta. Alcanna opened 5 of the first 17 recreational retail cannabis locations in Alberta on October 17, 2018. By December 31, 2019, Alcanna had opened an additional 16 recreational retail cannabis stores in Alberta and 1 in Ontario. These stores range in size from 1,200 to 5,600 square feet. Alcanna now operates a total of 30 cannabis retail stores under the "Nova Cannabis" brand and 4 under the "Deep Discount Cannabis" brand, with 33 locations in Alberta and one in Ontario.
With retail operations under the YSS™ and Sweet Tree™ brands, YSS Corp. has developed a retail cannabis business across Alberta and in Saskatchewan by operating 19 licensed retail stores in Alberta and Saskatchewan. It has 5 stores in development for 2021. YSS was continued under the laws of Alberta and has a head office in Calgary, Alberta. The YSS Shares trade on the TSXV under the symbol "YSS", on the Frankfurt Stock Exchange under the symbol "WKN: A2PMAX", and over the facilities of the OTCQB Venture Market under the symbol "YSSCF". Additional information about YSS is available at www.sedar.com and www.ysscorp.ca.
This press release does not constitute an offer to sell or the solicitation of an offer to buy any securities in any jurisdiction in which such offer, solicitation or sale would be unlawful including but not limited to in the United States. The securities to be issued in connection with the Financing have not been and will not be registered under the United States Securities Act of 1933 (the "U.S. Securities Act"), as amended, or any applicable securities laws of the United States, and may not be offered, sold or delivered, directly or indirectly, in the United States or to, or for the account or benefit of, U.S. persons, except pursuant to an exemption from the registrations requirements of the U.S. Securities Act and all applicable securities laws of the United States. "United States" and "U.S. person" are as defined in Regulation S under the U.S. Securities Act.
NEITHER TSX VENTURE EXCHANGE NOR ITS REGULATION SERVICES PROVIDER (AS THAT TERM IS DEFINED IN THE POLICIES OF THE TSX VENTURE EXCHANGE) ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS NEWS RELEASE.
Completion of the Transaction is subject to a number of conditions, including but not limited to, acceptance of the TSXV and approval of the YSS shareholders. The Transaction cannot close until the required shareholder approval is obtained. There can be no assurance that the Transaction will be completed as proposed or at all. Investors are cautioned that, except as disclosed in the management information circular to be prepared in connection with the Transaction, any information released or received with respect to the Transaction may not be accurate or complete and should not be relied upon. Trading in the securities of YSS should be considered highly speculative. The TSX Venture Exchange Inc. has in no way passed upon the merits of the Transaction and has neither approved nor disapproved the contents of this news release.
NOTE REGARDING FORWARD-LOOKING INFORMATION
This press release contains certain "forward-looking information" and certain "forward-looking statements" within the meaning of applicable securities laws, such as statements and information concerning anticipated future events, results, circumstances, performance or expectations that are not historical facts or information or current condition, but instead represent only the parties beliefs regarding future events, plans or objectives, many of which, by their nature, are inherently uncertain and outside of Alcanna's, YSS' or the Company's control. Use of words such as "may", "will", "expect", "plans", "could", "would", "might", "believe", "intends", "likely", or other words of similar effect may indicate a "forward-looking statement". The forward-looking information and forward-looking statements contained herein may include, but are not limited to, information concerning the Transaction and the Financing. These statements are not guarantees of future performance and are subject to numerous risks and uncertainties, including those described in the publicly filed documents of Alcanna or YSS (available on SEDAR at www.sedar.com).
Among the key risks and uncertainties that could cause actual results to differ materially from those projected in the forward-looking information and statements include, but not are limited to, the following: the ability to complete the Transaction and the Financing; the timing of the closing of the Transaction and the Financing; the ability obtain the requisite regulatory approvals and the satisfaction of other conditions to the closing of the Transaction on the proposed terms and schedule; the ability to satisfy the conditions to the consummation of the Financing; the potential impact of the announcement or consummation of the Transaction on relationships, including with regulatory bodies, employees, suppliers, customers and competitors; changes in general economic, business and political conditions, including changes in the financial markets; changes in applicable laws; compliance with extensive government regulation; and the diversion of management time on the Transaction and the Financing; risks relating to the COVID-19 pandemic, governmental responses thereto, measures taken by Alcanna or YSS in response thereto and the impact thereof on the global economy, capital markets, the cannabis retail industry and Alcanna, YSS and the Company.
These statements are made as of the date of this news release and, except as required by applicable law, neither Alcanna nor YSS undertake any obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise. Additionally, neither Alcanna nor YSS undertake any obligation to comment on analyses, expectations or statements made by third parties in respect of Alcanna or YSS, or their respective financial or operating results or their securities. Readers cannot be assured that the Financing or the Transaction will be completed on the terms described above, or at all. Alcanna and YSS do not assume any obligation to update or revise any forward-looking statements, whether written or oral, that may be made from time to time by the Alcanna or YSS on behalf of Alcanna, YSS or the Company, except as required by applicable law.
Readers are cautioned that the foregoing lists of factors are not exhaustive. Additional information on these and other factors that could affect operations or financial results of Alcanna and YSS are included in reports on file with applicable securities regulatory authorities and may be accessed through the SEDAR website (www.sedar.com). These forward-looking statements are made as of the date of this press release and Alcanna and YSS disclaim any intent or obligation to update publicly any forward-looking information, whether as a result of new information, future events or results or otherwise, other than as required by applicable securities laws.
FOR FURTHER INFORMATION PLEASE CONTACT:
Vice-Chair and Chief Executive Officer
For New Nova:
Chief Executive Officer (as of closing)
President, Chief Executive Officer and Director