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Subsequent Events

12 Months Ended

Dec. 31, 2019

18	SUBSEQUENT EVENTS

On March 6, 2020 the Company and Emerald closed a settlement agreement in order to settle all outstanding disputes with respect to Pure Sunfarms (note 5).

On March 24, 2020, the Company completed an underwritten public offering of

3,125,000

Common Shares in the capital of the Company plus the exercise in full of the over-allotment option of

468,750 Common Shares

at a price of

$3.20 per Offered Share for aggregate gross proceeds to the Company of $11,500,000 (the “Offering”). The Offering was conducted by Beacon Securities Limited (the “Underwriter”), as sole underwriter. (All figures are expressed in Canadian dollars.)

The net proceeds to the Company from the Offering, after deducting the Underwriter’s fee of $0.69 million, but before deducting the expenses of the Offering, were $10.71 million.

On March 28, 2020, Pure Sunfarms secured a CA$7,500 revolving line of credit and CA$12,500 term credit facility. The Company, along with Emerald, are guarantors of the loan and as a condition of funding, the shareholders are required to contribute CA$16,000 of additional equity, of which CA$8,000 has been contributed by the Company (note 5). The Company has committed to contributing a further CA$8,000.