Weedmd Announces Closing of $34.5 Million Bought Deal Equity Financing


Ryan Allway

January 11th, 2018

News


WeedMD Inc. (TSX-V: WMD) (“WeedMD” or the “Company”), a federally-licensed producer and distributor of medical cannabis, is pleased to announce that it has closed its previously announced short form prospectus offering, including the full exercise of the over-allotment option. As such, a total of 16,046,511 units of the Company (“Units“) were sold at a price of $2.15 per Unit (the “Issue Price“) for aggregate gross proceeds of $34,500,000 (the “Offering“). The Offering was completed by a syndicate of underwriters including Eight Capital as sole bookrunner and co-lead underwriter with Mackie Research Capital Corporation and including Haywood Securities Inc. (the “Underwriters“).

Each Unit consists of one common share of the Company (a “Common Share”) and one-half of one Common Share purchase warrant (each whole warrant a “Warrant”). Each Warrant entitles the holder thereof to purchase one Common Share at an exercise price of $2.90, until January 11, 2020. If, following the closing of the Offering, the volume weighted average price of the Common Shares on the TSX Venture Exchange is equal to or greater than $4.20 for any 20 consecutive trading days, the Company may, upon providing written notice to the holders of Warrants, accelerate the expiry date of the Warrants to the date that is 30 days following the date of such written notice.

As consideration for its services, the Underwriters received a cash commission equal to 6% of the gross proceeds of the Offering. The Company also issued 481,395 compensation options to the Underwriters in an amount equal to 3% of the number of Units issued pursuant to the Offering. Each compensation option is exercisable into one Unit at the Issue Price, until January 11, 2020.

The Company intends to use the net proceeds of the Offering to expand its lease footprint and retrofitting plans and operations at its 14-acre Strathroy Greenhouse, to purchase and further develop its Aylmer Facility, to pursue potential strategic domestic and international opportunities and for working capital and general corporate purposes.  For more about the expansion, read here.

The Units were offered and sold by way of a short form prospectus filed in each of the provinces of Canada, excluding Quebec, and offered and sold elsewhere outside of Canada on a private placement basis.

The securities referred to in this news release have not been, nor will they be, registered under the United States Securities Act of 1933, as amended (the “1933 Act”), and may not be offered or sold within the United States or to, or for the account or benefit of, U.S. persons absent registration under the 1933 Act or an applicable exemption from such registration requirements. This news release does not constitute an offer for sale of securities for sale, nor a solicitation for offers to buy any securities. “United States” and “U.S. person” are as defined in Regulation S under the 1933 Act.

About WeedMD Inc.:

WeedMD Inc. is the publicly-traded parent company of WeedMD Rx Inc., a federally-licensed producer and distributor of medical cannabis under the Access to Cannabis for Medical Purposes Regulations (ACMPR). The Company operates a 26,000 sq. ft. indoor facility in Aylmer, Ontario, and is awaiting its second-site cultivation license for its greenhouse facility located in Strathroy, Ontario, representing 610,000 sq. ft. or 14 acres under glass. WeedMD has entered into supply agreements in addition to strategic relationships with established cannabis brands. The Company is focused on providing medical cannabis to the long-term care, assisted living and seniors’ markets in Canada through its specialized and comprehensive platform. It is dedicated to educating healthcare practitioners and furthering public understanding of the role that medical cannabis plays – including as it pertains to regulatory requirements, indications and potential side effects.

Ryan Allway

About Ryan Allway

Mr. Allway has over a decade of experience in the financial markets as both a private investor and financial journalist. He has been actively involved in the cannabis industry since its inception, covering public and private companies.


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