Aleafia Health Provides Further Update on its Convertible Debt

Rhea-AI Summary

Aleafia Health has successfully secured approval for amendments to its outstanding unsecured convertible debentures, with approximately 76.12% of debentureholders consenting, surpassing the required 66 2/3%. The previously scheduled meeting for June 23, 2022, has been canceled. The transaction is set to close during the week of June 27, 2022, with qualifying debentureholders eligible for a consent fee, estimated at $84.65 per $1,000 principal amount, payable in additional 2028 Debentures. This development is crucial for improving the Company’s debt structure.

Positive

• 76.12% of debentureholders approved the amendments, exceeding the required threshold.
• Cancellation of the meeting streamlines the approval process.
• The consent fee incentivizes timely responses from debentureholders.

Negative

• None.

• Following final tabulation, Debentureholders pass Extraordinary Resolution approving Debenture Amendments
  
• Canceling Debentureholder meeting previously scheduled for June 23, 2022

TORONTO, June 20, 2022 (GLOBE NEWSWIRE) -- Aleafia Health Inc. (TSX: AH, AH.DB, OTCQX: ALEAF) (“Aleafia Health” or the “Company”) is providing a corporate update regarding its outstanding listed unsecured convertible debentures (TSX: AH.DB), issued on June 27, 2019 and maturing on June 27, 2022 (the “Debentures”). Debentureholders representing approximately 76.12% of the aggregate principal amount of Debentures outstanding have executed consents in favour of the amendments to the Debentures (the “Debenture Amendments”) previously announced by the Company on May 12, 2022. This exceeds the required 66 2/3% for the written extraordinary resolution to approve the Debenture Amendments. The meeting scheduled for June 23, 2022 will be cancelled.

The transaction is expected to close the week of June 27, 2022. Upon completion of the transaction, Debentureholders who timely responded to the consent solicitation by the applicable deadlines described in the solicitation materials will receive a consent fee (the “Consent Fee”) calculated as the amount of accrued interest on the existing Convertible Debentures between July 1, 2021 and the effective date of the Debenture Amendments, payable in additional 2028 Debentures at par. For illustration, if the effective date of the Debenture Amendments occurs on June 30, 2022, the Consent Fee payable in additional 2028 Debentures at par would be $84.65 per $1,000 principal amount of Debentures¹, or 8.5%, subject to 25% withholding for non-residents of Canada.

For Investor & Media Relations:

1-833-879-2533

IR@AleafiaHealth.com

LEARN MORE: www.AleafiaHealth.com

About Aleafia Health:

Aleafia Health, a vertically integrated and federally licensed Canadian cannabis company, owns three licensed cannabis production facilities, including the first large-scale, legal outdoor cultivation facility in Canadian history, and operates a strategically located distribution centre, all in the province of Ontario. The Company produces a diverse portfolio of cannabis derivative products including oils, capsules, edibles, sublingual strips, and vapes, for sale in Canada in the adult-use and medical markets and is pursuing opportunities in select international jurisdictions. The Company owns and operates a virtual network of medical cannabis clinics staffed by physicians and nurse practitioners.

Forward Looking Information

This news release contains forward-looking information within the meaning of applicable Canadian and United States securities laws. Often, but not always, forward-looking information can be identified by the use of words such as “plans”, “expects”, “estimates”, “intends”, “anticipates”, or “believes” or 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. Forward-looking information involves known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company or its subsidiaries to be materially different from any future results, performance or achievements expressed or implied by the forward-looking information contained in this news release. Risks, uncertainties and other factors involved with forward-looking information could cause actual events, results, performance, prospects and opportunities to differ materially from those expressed or implied by such forward-looking information, including risks contained in the Company’s annual information form filed with Canadian securities regulators available on the Company’s SEDAR profile at www.sedar.com. Although the Company believes that the assumptions and factors used in preparing the forward-looking information in this news release are reasonable, undue reliance should not be placed on such information and no assurance can be given that such events will occur in the disclosed time frames or at all. The forward-looking information included in this news release are made as of the date of this news release and the Company does not undertake any obligation to publicly update such forward-looking information to reflect new information, subsequent events or otherwise unless required by applicable securities legislation.

¹ The Company’s May 12, 2022 reflected an incorrect amount of the Consent Fee in $s per debenture.

FAQ

What percentage of debentureholders approved the amendments for Aleafia Health?

Approximately 76.12% of debentureholders approved the amendments.

What was the scheduled date for the canceled Aleafia Health debentureholder meeting?

The debentureholder meeting was scheduled for June 23, 2022.

When is the transaction related to Aleafia Health's debentures expected to close?

The transaction is expected to close the week of June 27, 2022.

What is the estimated consent fee for Aleafia Health's debentureholders?

The consent fee is estimated at $84.65 per $1,000 principal amount of debentures.