Aleafia Announces Launch of Early Warrant Incentive Program

Gross Proceeds of Program to Reach up to $21.1M

TORONTO, Sept. 27, 2018 (GLOBE NEWSWIRE) -- Aleafia Health Inc. ALEFALEAFARAH)) (the "Company" or "Aleafia") announces a proposed early exercise warrant program (the "Program") designed to encourage the early exercise of up to 12,085,500 warrants with an exercise price of $1.75 per warrant and an expiration date of September 27, 2019 (the "Warrants").

The Program will be open to eligible Canadian holders of the Warrants who exercise during a 30 day period expected to commence as soon as possible following receipt of TSX Venture Exchange conditional approval (the "Early Exercise Period").  Upon receipt of such approval, the Company will issue a further press release announcing the commencement date of the Early Exercise Period.

Details of the Early Exercise Warrant Program:

Each eligible holder of Warrants who participates in the Program will receive 0.0727 common shares ("Incentive Shares") in the capital of the Company (at a value of $3.10 per whole Incentive Share) for every one (1) Warrant exercised.

As a result, if all Warrants are exercised during the Early Exercise Period, Aleafia expects it will:

• Receive gross proceeds of $21,149,625 through the exercise of up to 12,085,500 Warrants;
  
  
• Issue 12,085,500 common shares pursuant to the above exercise of Warrants in accordance with the original terms of the Warrants; and
  
  
• Issue 878,317 Incentive Shares to encourage the early exercise of the Warrants by the holders thereof. The Incentive Shares will be subject to a four month hold period from the date of issuance.

"The sustained momentum realized by Aleafia will only accelerate with the launch of our Early Warrant Incentive Program," said Aleafia CEO Geoffrey Benic. "Additional capital will allow us to continue executing our successful business strategy as we build on the rock solid foundation of our cannabis cultivation and medical clinic businesses."

The proceeds from the warrant exercise incentive program, along with Aleafia's strong balance sheet fully funds the Company's production and extraction facility plans.

Pursuant to the terms of the Program, any fractional Incentive Share that a warrantholder is otherwise entitled to receive will be rounded down to the nearest whole share. Insiders of the Company who hold Warrants will not be eligible to participate in the Program. 

Holders of Warrants who wish to participate in the Program will agree to exercise their Warrants pursuant to the terms of such Warrants and to deliver the required documentation in connection with the Program, including a form of subscription agreement to be completed by warrantholders in relation to the issuance of the Incentive Shares.  These documents, together with detailed instructions, will be set forth in a letter to warrantholders and will be posted on SEDAR following the issuance of the Company's further press release announcing the commencement date of the Early Exercise Period.

If Warrants are not exercised prior to the end of the Early Exercise Period, the Warrants will remain outstanding and continue to be exercisable on the same terms applicable to such Warrants as they existed prior to the Program.

The Program is subject to the approval of the TSX Venture Exchange.

To the extent that holders of the Warrants take advantage of the opportunity to exercise their Warrants early, this Program, Mackie Research Capital Corporation is acting as an exclusive soliciting agent to Aleafia in connection with the Program. 

For Additional Information and Support:

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

About Aleafia Health Inc. 

Aleafia is a leading, vertically integrated cannabis company with major cannabis cultivation & processing and medical cannabis clinics business operations. Aleafia owns two cannabis cultivation facilities, one of which is licensed and fully operational and one which will be fully operational in late 2018. Aleafia will reach a fully-funded annual growing capacity of 38,000 kg in 2019. Canabo Medical Clinics are the largest brick and mortar medical cannabis clinic network in Canada with 22 locations and over 50,000 patients. 

Forward-looking (safe harbour) statement

Certain information in this press release may contain forward-looking statements. This information is based on current expectations that are subject to significant risks and uncertainties that are difficult to predict. Actual results might differ materially from results suggested in any forward-looking statements. The Company assumes no obligation to update the forward-looking statements, or to update the reasons why actual results could differ from those reflected in the forward looking statements unless and until required by securities laws applicable to the Company. Additional information identifying risks and uncertainties is contained in filings by the Company with the Canadian securities regulators, which filings are available at www.sedar.com.