Vaughan, Ontario – (Newsfile Corp. – February 23, 2021) – Spyder Cannabis Inc. (TSXV: SPDR) (“Spyder” or the “Company”), an established Canadian cannabis and vape retailer, is pleased to announce that the company has partnered with CRHC Holdings Corp. (the “Seller”) entered into a binding agreement to acquire all of the issued and outstanding shares of the companies that make up the business of 180 Smoke (“180 Smoke”), a dominant vape retailer in Canada. The Company has agreed to purchase 180 Smoke’s shares (the “Acquisition”) cashless (after post-closing adjustments) for nominal consideration. In addition, the company has recruited a strategic institutional investor to purchase all of 180 Smoke’s existing debt through a subsidiary of the seller. The parties will complete the acquisition upon completion of the closing conditions.

Transaction highlights

  • 180 Smoke is a leading Canadian vape product retailer widely recognized as the gold standard for vape business operations and customer service. 180 Smoke sells high quality e-cigarettes, vaporizers and other nicotine products.

  • The acquisition is expected to immediately increase Spyder’s consolidated sales by adding 180 smoke nicotine vaporizer sales, franchise income, and other wholesale and distribution revenues, which generated unaudited net sales of approximately $ 12.9 million for the fiscal year ended December 31, 2020. USD.

  • 180 Smoke has a team of 91 people who, upon completion of the acquisition, will continue to operate 180 Smoke’s 18 retail stores, 8 franchises, as well as corporate headquarters and distribution warehouse.

  • 180 Smoke’s current customer base includes 92,481 in-store accounts, 98,052 online accounts and 235 vape B2B wholesale accounts.

  • Spyder expects to integrate its 2 brick and mortar retail stores with those of 180 Smoke’s to capitalize on the expertise and intellectual property acquired, including retail store design and layout, standard operating procedures, administrative systems and customer care, human resource training and accounting.

  • Synergies are also expected between 180 Smoke’s existing customer base and Spyder’s cannabis business.

  • Spyder will have the ability to use its wholly owned subsidiary’s retail operating license issued by the Ontario Alcohol and Gaming Commission (AGCO) to convert some of Smoke’s 180 retail vape locations into licensed cannabis dispensaries by obtaining a retail business permit from AGCO for such a store.

Dan Pelchovitz, Spyder President & CEO, commented, “The acquisition of 180 Smoke is a significant development in Spyder’s growth strategy as it gives the company access to a well-known brand name, an established platform and a loyal customer base. We are delighted the management team and integrate the people at 180 Smoke as they will bring significant expertise and depth to the expansion of our vape and cannabis business. 180 Smoke is a very successful Canadian vape retail company and the perfect solution to accelerate Spyder’s expansion plans. “

The story goes on

In addition, Spyder is pleased to announce that it intends to sell Spyder securities (the “Offering”) comprised of Shares (the “Shares”) at a price of US $ 0.0675 per Share in unbroken private placement on the Offer sale total proceeds of up to $ 1,000,000.

Each unit is expected to consist of one common share (a “Share”) of Spyder and up to one warrant to buy one stock (a “Warrant”), each warrant exercisable for one share at a price of $ 0.135 per share for one share to be acquired twenty four months after the closing date of the offering. Assuming that the maximum proceeds will be increased, Spyder will issue 14,814,815 shares and 14,814,815 warrants under the offering.

The offering is subject to final approval by the TSX Venture Exchange (“TSXVE”) and all regulatory approvals.

All securities issued as part of the offer are subject to a TSXVE holding period in addition to the period blocked under the applicable securities laws and are marked accordingly.

The proceeds from the offering will be used for general administrative expenses related to the 180 Rauch business, debt repayment, and general working capital.

There can be no guarantee that the offer will be completed on the terms set forth herein or at all, or that the proceeds of the offer will be sufficient for the Company’s purposes set out herein.

The securities offered have not been registered under the United States Securities Act of 1933, as amended, and may not be offered or sold in the United States, for or for the account or for the benefit of US persons for whom no registration or an applicable exception has been made Registration requirements. This press release does not constitute an offer to sell any securities in the United States.

About Spyder Cannabis Inc.

Spyder is a cannabis and vape retailer operating in countries where the products are federally legal in Canada. The company is a retailer through its subsidiaries that is involved in the development of two retail businesses. The first is selling cannabis products and the second is selling smoking cessation products.

Warning notices

Neither the TSX Venture Exchange nor its regulator (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this press release.

Certain statements in this press release contain forward-looking information. These statements relate to future events or future company performance. The use of any of the words “might,” “intend,” “expect,” “believe,” “will,” “may,” “project”, “estimate” and similar expressions and statements relating to matters that are not historical Facts are intended to identify forward-looking information and are based on the Company’s current beliefs or assumptions about the outcome and timing of such future events. Actual future results could differ materially. In particular, this press release contains forward-looking information regarding the company’s business. Various assumptions or factors are typically used in drawing conclusions or making forecasts or projections in forward-looking information. These assumptions and factors are based on information currently available to the parties. Material factors and assumptions include regulatory and other third party approvals, licenses, the completion of the acquisition, Spyder’s decision to proceed with the offering on the terms described in this news release, and Spyder’s ability to obtain the TSXV approval for the to get offer and other risks. The forward-looking information contained in this press release is as of the date of this release and the parties undertake no obligation to update or revise any forward-looking information as a result of new information, future events or otherwise, except as required by securities law. Due to the risks, uncertainties and assumptions contained herein, investors should not place undue reliance on forward-looking information. The foregoing statements expressly qualify all forward-looking information contained herein.

For more information please contact:

Spyder Cannabis Inc.
And Pelchovitz
President and CEO
T: 1.888.504.7737
E: corpor@spydercannabis.com

The source version of this press release can be found at https://www.newsfilecorp.com/release/75203