Cannasouth Rights Offer and new General Retail Offer Opens

Cannasouth Limited (NZX:CBD) launched a Capital Raise in support of the proposed merger with Eqalis for $9 million ("Capital Raise") on Monday 1st May 2023. In order to implement the acquisition of Eqalis, Cannasouth must, as a condition of the transaction with Eqalis shareholders, raise not less than $7 million of new capital on or before 9 June 2023. To seek to satisfy this condition, Cannasouth today opens its rights offer to Cannasouth's existing shareholders to raise up to $4.5 million ("Cannasouth Offer"), together with another offer to existing Eqalis shareholders, to raise a further $4.5 million ("Eqalis Offer"). If both offers are successful, Cannasouth would raise a total of $9 million. Cannasouth reserves the right to accept oversubscriptions under both offers of a further $2 million in aggregate. In addition, the Board has resolved to make an offer to non-Cannasouth and non-Eqalis shareholders who are resident in New Zealand under a General Retail Offer ("General Offer"). Investors in the General Offer will have the ability to apply for new Cannasouth shares in the shortfall under the Cannasouth Offer or the Eqalis Offer (if any) and/or to participate in any oversubscription facility for the Cannasouth Offer or the Eqalis Offer should the Board resolve to accept oversubscriptions in respect of the two offers. A copy of the Offer document in support of the General Offer accompanies this announcement, together with a copy of an updated Cleansing Statement. The Offers open today. The Board is pleased to announce that firm commitment subscription agreements, having an aggregate value of $5.1 million, have been received by the Company to date. From today, Eligible Shareholders under the Cannasouth Offer and the Eqalis Offer will be sent their personalised Letter of Entitlement with links to the Non-Renounceable Offer Document and Online Acceptance Form, which Form delineates each respective shareholders entitlement to participate in the respective Offers. The following documents accompany this announcement: 1. General Retail Offer Document 2. Cleansing Statement -ENDS- For further information visit www.cannasouth.co.nz or contact: Mark Lucas CEO / Executive Director Email: mark.lucas@cannasouth.co.nz Mobile: 021 484 649 Colin Foster CFO / Company Secretary Email: colin.foster@cannasouth.co.nz Mobile: 027 577 1498 End CA:00411171 For:CBD Type:OFFER Time:2023-05-10 09:05:35