Mr. Chris Wagner of Emerald Health reports

EMERALD HEALTH THERAPEUTICS COMPLETES FULL ACQUISITION OF LICENSED DEALER NORTHERN VINE TO ADVANCE PRODUCT INNOVATION

Emerald Health Therapeutics Inc. has signed a definitive agreement to acquire the remaining shares of Northern Vine Canada Inc., owned by Abattis Bioceuticals Corp., for $2-million in cash and $4-million in shares of Emerald stock. This transaction increases Emerald's ownership of Northern Vine from 65 per cent to 100 per cent. Northern Vine is a licensed dealer (LD) under the provisions of the Canadian Controlled Drugs and Substances Act.

"Product innovation is a primary pillar of Emerald's global business strategy. The acquisition of Northern Vine allows us to leverage its dealer licence and research and development facility to advance our research plans to develop cannabis formulations supporting new products for both recreational purposes and to treat a broad spectrum of human conditions and diseases," said Chris Wagner, chief executive officer of Emerald. "The dealer licence would also enable Emerald to cost-effectively source non-dried-flower cannabis products from suppliers in other countries."

"Northern Vine will operate independently of Emerald and is committed to serving all clients, including licensed producers and patient-growers. Legalization of cannabis for medical and recreational purposes is expected to drive demand for analytical testing services to assess potency and concentration of toxic materials. The global market is expected to exceed $1-billion in 2018 (1). We expect significant growth potential for Northern Vine in the Canadian analytical testing marketplace."

An LD is permitted to conduct certain activities that licensed producers (LP) are not permitted under Access to Cannabis for Medical Purposes Regulations (ACMPR), such as importing/exporting cannabis oils, as well as preparing the manipulation, formulation, dosage form, strength or package size of cannabis products, including mixtures with other additives, controlled substances and non-controlled substances. In addition, it allows Emerald to participate in the growing market for cannabis analytical testing, which is expected to grow in conjunction with increasing cannabis production volumes in Canada.

In November, 2017, Emerald acquired 53 per cent of Northern Vine from Abattis for $2-million. In May, 2018, Emerald increased its stake to 65 per cent for an additional $2.75-million.

The agreement also includes a milestone payment in the form of common shares of Emerald valued at $4-million if Northern Vine and/or Emerald receives gross revenue of $10-million from the sale of products or services introduced by Abattis.

About Emerald Health Therapeutics Inc.

Emerald Health Therapeutics is a licensed producer under Canada's Access to Cannabis for Medical Purposes Regulations and produces and sells dried cannabis and cannabis oil for medical purposes. Emerald is preparing to serve the fully legalized Canadian adult-use cannabis market starting Oct. 17, 2018. Emerald owns 50 per cent of Pure Sunfarms, which is converting a licensed existing 1.1-million-square-foot greenhouse in Delta, B.C., and is now in commercial production. It owns Agro-Biotech, a Quebec-based licensed cannabis grower with a 75,000-square-foot indoor facility and is planning to add a 500,000-square-foot greenhouse in Metro Vancouver.

Emerald's team is highly experienced in life sciences, product development, large-scale agribusiness and marketing, and is focused on developing value-added cannabis-based products with potential wellness and medical benefits. Emerald is part of the Emerald Health group, which is broadly focused on developing pharmaceutical, botanical, and nutraceutical products that may provide wellness and medical benefits by interacting with the human body's endocannabinoid system.

(1) Market Insights -- Cannabis Testing Market, Coherent Market Insights.