Aleafia Health and Emblem Announce Closing of Arrangement

Listed Emblem Warrants

Prior to the completion of the Arrangement, Emblem had outstanding three classes of warrants to purchase common shares of Emblem listed on the TSXV:

• EMC.WT – exercisable at a price of $1.75 with an expiry date of December 6, 2019 (the “2019 Warrants”) issued pursuant to a warrant indenture between Emblem and Computershare Trust Company of Canada (“Computershare”) dated December 6, 2016 (the “2019 Warrant Indenture”);
• EMC.WT.A – exercisable at a price of $2.15 with an expiry date of November 16, 2020 (the “November 2020 Warrants”) issued pursuant to a warrant indenture between Emblem and Computershare dated November 16, 2017 (the “November 2020 Warrant Indenture”); and
• EMC.WT.B – exercisable at a price of $2.70 with an expiry date of February 2, 2020 (the “February 2020 Warrants”) issued pursuant to a warrant indenture between Emblem and Computershare dated February 2, 2018 (the “February 2020 Warrant Indenture”);

(the 2019 Warrants, November 2020 Warrants and February 2020 Warrants are referred to collectively as the “Listed Emblem Warrants”).

Following the completion of the Arrangement the Listed Emblem Warrants, with the exception of any Listed Emblem Warrants that have been exercised prior to closing of the Arrangement, will remain outstanding as warrants of Amalco (continuing on as “Emblem Corp.”) that upon exercise will entitle the holder thereof to receive the Consideration.

The Listed Emblem Warrants will continue trading on the TSXV as Amalco warrants, under their existing trading symbols, and will remain listed on the TSXV until the earliest to occur of their exercise, expiry or earlier delisting.

Pursuant to the terms of the Arrangement Agreement, and as required by each of the 2019 Warrant Indenture, November 2020 Warrant Indenture and February 2020 Warrant Indentures, Aleafia Health has entered into supplemental warrant indentures in respect of each the foregoing warrant indentures governing the Listed Emblem Warrants. Copies of each of the supplemental warrant indentures are available on Emblem’s and Aleafia Health’s respective SEDAR profiles at www.sedar.com.

Aleafia Health has submitted an application on behalf of Amalco to the applicable securities regulators for relief from certain continuous disclosure and insider reporting requirements. In the event Amalco is granted such relief, holders of Listed Emblem Warrants will be directed to reference, and rely on, the public disclosure filings of Aleafia Health.

Termination of Aleafia Health and Emblem Escrow

In connection with, and effective as of, the listing of the Common Shares on the TSX, the TSXV has approved the termination of the November 9, 2016 Aleafia Health escrow agreement and the December 6, 2016 Emblem escrow agreement. Upon termination of the Aleafia Health escrow agreement 4,129,650 Common Shares will be released from escrow and upon termination of the Emblem escrow agreement 6,584,133 Common Shares will be released from escrow plus any Common Shares previously issued upon the exercise of any escrowed Emblem options or warrants, if any.

Success Fee

As previously disclosed, in connection with completion of the Arrangement Aleafia Health has paid to Mackie Research Capital Corporation a success fee of 2,331,255 Common shares.

About Aleafia Health

Aleafia Health is a leading, vertically integrated cannabis health and wellness company with four primary business units: Cannabis Cultivation & Products, Health & Wellness Clinics, Cannabis Education, and Consumer Experience with ecommerce, retail distribution and provincial supply.

Aleafia Health owns three major cannabis product & cultivation facilities where it produces a diverse portfolio of commercially proven, high-margin derivative products including oils, capsules and sprays. Aleafia Health operates the largest national network of medical cannabis clinics and education centres staffed by MDs, nurse practitioners and educators.

Aleafia Health maintains a medical cannabis dataset with over 10 million data points to inform proprietary illness specific product development and treatment best practices.  

Learn more at www.AleafiaHealth.com

For Investor & Media Relations:

About Emblem

Emblem is a fully integrated cannabis company focused on driving shareholder value through product innovation, brand relevance, and access to patient and consumer channels. Through its wholly-owned subsidiary Emblem Cannabis Corporation, Emblem is licensed to cultivate, process, and sell cannabis and cannabis derivatives in Canada under the Cannabis Act. Emblem’s state-of-the-art indoor cannabis cultivation facility and Product Innovation Centre is located in Paris, Ontario. Emblem is also the parent company of GrowWise Health Limited, one of Canada’s leading cannabis education services.

For more information, please visit www.emblemcorp.com.

Neither the TSXV nor its Regulation Services Provider (as that term is defined in the policies of the TSXV) accepts responsibility for the adequacy or accuracy of this release.

Cautionary Note Regarding Forward-Looking Statements:

This news release includes statements containing forward-looking information regarding Aleafia Health and Emblem and their respective businesses. Often, but not always, forward-looking information can be identified by the use of words such as “plans”, “is expected”, “expects”, “scheduled”, “intends”, “contemplates”, “anticipates”, “believes”, “proposes” or variations (including negative variations) of such words and phrases, or state that certain actions, events or results “may”, “could”, “would”, “might” or “will” be taken, occur or be achieved, and include statements in this press release concerning the expected timing by which Emblem and Aleafia Health will be de-listed from the TSXV and Aleafia Health’s subsequent listing to the TSX, our expectations as to the continued listing of the Listed Emblem Warrants and as to the anticipated termination of each of the Aleafia Health and Emblem escrow agreements, our expectations relating to Emblem’s application to terminate its public reporting obligations, our expectations of the benefits associated with combination of the Aleafia Health and Emblem. Such statements are based on the current expectations of the management of Aleafia Health and Emblem. Such forward-looking events and circumstances may not occur when anticipated or at all and could differ materially as a result of known and unknown risk factors and uncertainties affecting Aleafia Health or Emblem, including risks regarding the cannabis industry, economic factors, the equity markets generally, risks associated with growth and competition and those risk factors referred to in the management information circular of Emblem prepared in connection with the Meeting. Although Aleafia Health and Emblem have attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in this news release, there may be other factors that cause actions, events or results to differ from those anticipated, estimated or intended. Forward-looking information cannot be guaranteed. Except as required by applicable securities laws, statements in this news release containing forward-looking information speak only as of the date on which they are made and Aleafia Health and Emblem undertake no obligation to publicly update or revise any forward-looking information, whether as a result of new information, future events, or otherwise, except as required by applicable securities laws.

A photo accompanying this announcement is available at