Speakeasy Announces it May Delay in Filing its Financial Statements and Files an Application for a Management Cease Trade Order and an Extension of Warrants

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ROCK CREEK, BC, Nov. 25, 2021 /CNW/ - Speakeasy Cannabis Club Ltd. (CSE: EASY) (Frankfurt: 39H) (the "Company" or "SpeakEasy") announces that it may have a delay to the timely filing of its audited financial statements and corresponding management's discussion and analysis for the year ended July 31, 2021 (collectively, the "Financial Disclosure") on or before the prescribed filing deadline of November 29, 2021 as required by National Instrument 51-102 – Continuous Disclosure Obligations. 

Similar to other companies, SpeakEasy has been impacted by COVID-19 related lockdowns, quarantine measures and economic pressures experienced worldwide. Reasons for the delay in filing include: the challenge to complete a portion, as it relates to the rapid growth of Company's operations, of the Company's annual audit in normal time frames as a result of an increase in complex accounting considerations relating to revenues, cost of sales, and inventory. In addition to the challenges surrounding COVID-19, the Company experienced another year of significant growth in its range of products available for sale further complicating the disclosure and reporting requirements of the financial statements. Consequently, the Company has been challenged to fulfill the auditor's requests prior to the filing deadline for the Financial Disclosure. The preparation and review of the Annual Filings is substantially complete and the Applicant understands that its auditor is undergoing additional procedures to verify certain transactions.

SpeakEasy is working diligently with its auditors and financial professionals to provide the additional documentation to its auditors and to complete the audit of the financial statements for the year ended July 31, 2021.  In the event that the Company does delay in filing, it anticipates that it will be in a position to file its Financial Statements no later than December 15, 2021.  The Company confirms that it will comply with the alternative information guidelines included in National Policy 12-203 – Management Cease Trade Orders, for so long as it remains in default of a specified requirement.

The Company has filed an application with the British Columbia Securities Commission, the Alberta Securities Commission and the Ontario Securities Commission requesting that they issue a management cease trade order against the Company's directors, officers and insiders instead of a cease trade order against the Company and all of its securityholders.

Warrant Extension

On December 6, 2019, the Company closed a private placement for aggregate gross proceeds of $1,315,000. The Private Placement consisted of the issuance of units of the Company (the "Units") at a price of $0.40 per Unit.  Each Unit consisted of one common share in the capital of the Company (a "Common Share") and one Common Share purchase warrant (a "Warrant"). Each Warrant entitled the holder to acquire an additional Common Share at a price of $0.80 for a period of 12 months from closing. The Company extended the warrants until Dec 6, 2021. In accordance with the policies of the Canadian Securities Exchange (the "CSE"), the Company has extended the expiry date of the Warrants for an additional 12 month period, such that the new expiry date of the Warrants will be December 6, 2022. The CSE granted the Company an exemption from the requirement set forth in Section 7.4.1(d) of CSE Policy 6 that 10 trading days remain prior to the original expiry date when applying to amend the terms of the Warrants

About SpeakEasy Cannabis Club Ltd.:

SpeakEasy Cannabis Club Ltd. holds a cultivation, processing and sales licence issued by Health Canada under the Cannabis Act. SpeakEasy owns 290 acres of land in Rock Creek, British Columbia, and leverages five generations of farming experience in B.C. as well as its favourable location to grow and process high-quality cannabis products at low cost. SpeakEasy cultivates small batch, high quality craft cannabis at scale in a portion of its 63,200 square foot indoor cannabis complex and has completed its harvest of its 60-acre outdoor field.

Statement Regarding Forward-Looking Information

This news release contains statements that constitute "forward-looking statements." Such forward looking statements involve known and unknown risks, uncertainties and other factors that may cause SpeakEasy's actual results, performance or achievements, or developments in the industry to differ materially from the anticipated results, performance or achievements expressed or implied by such forward-looking statements. Forward looking statements are statements that are not historical facts and are generally, but not always, identified by the words "expects," "plans," "anticipates," "believes," "intends," "estimates," "projects," "potential" and similar expressions, or that events or conditions "will," "would," "may," "could" or "should" occur.

Forward-looking statements in this document include statements concerning SpeakEasy's intent to file the Financial Disclosure before December 15, 2021, its intent to produce and sell high quality craft cannabis and all other statements that are not statements of historical fact.  

Although SpeakEasy believes the forward-looking statements contained in this news release are reasonable based on information available on the date hereof, by their nature forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause our actual results, performance or achievements, or other future events, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. By their nature, these statements involve a variety of assumptions, known and unknown risks and uncertainties and other factors, which may cause actual results, levels of activity and achievements to differ materially from those expressed or implied by such statements.

Examples of such assumptions, risks and uncertainties include, without limitation, assumptions, risks and uncertainties associated with general economic conditions; COVID-19, adverse industry events; future legislative and regulatory developments involving cannabis; the Company's ability to access sufficient capital from internal and external sources, and/or inability to access sufficient capital on favorable terms; the cannabis and hemp industries and markets in Canada and generally; the demand for CBD distillate, cannabis and cannabis related products, the ability of SpeakEasy to implement its business strategies; competition; the ability of SpeakEasy to obtain and retain all applicable licences under the Cannabis Act and other assumptions, risks and uncertainties.

THE FORWARD-LOOKING INFORMATION CONTAINED IN THIS NEWS RELEASE REPRESENTS THE EXPECTATIONS OF THE COMPANY AS OF THE DATE OF THIS NEWS RELEASE AND, ACCORDINGLY, IS SUBJECT TO CHANGE AFTER SUCH DATE. READERS SHOULD NOT PLACE UNDUE IMPORTANCE ON FORWARD-LOOKING INFORMATION AND SHOULD NOT RELY UPON THIS INFORMATION AS OF ANY OTHER DATE. WHILE THE COMPANY MAY ELECT TO, IT DOES NOT UNDERTAKE TO UPDATE THIS INFORMATION AT ANY PARTICULAR TIME EXCEPT AS REQUIRED IN ACCORDANCE WITH APPLICABLE LAWS.

The Canadian Securities Exchange has not approved nor disapproved the contents of this news release.

SOURCE Speakeasy Cannabis Club Ltd.

Malcolm Davidson, CEO, [email protected], 1-604-218-9797