Mr. Charles Shin reports

GULFSTREAM ACQUISITION 1 CORP. ANNOUNCES PROPOSED QUALIFYING TRANSACTION WITH HERMAN MARKET LTD.

Gulfstream Acquisition 1 Corp. has entered into a non-binding letter of intent (LOI) with Herman Market Ltd. which outlines the general terms and conditions of a proposed transaction that will result in Gulfstream acquiring all of the issued and outstanding shares of Herman Market.

The proposed transaction is currently expected to be completed by way of an acquisition of 100 per cent of the common shares of Herman Market by Gulfstream that will result in Herman Market becoming a wholly owned subsidiary of Gulfstream.

Overview of Herman Market

Herman Market is in the business of designing, developing, producing and marketing an elevated contemporary luxury men's and women's designer apparel and accessories brand. From 2014 to 2016, these products were developed and sourced through contract manufacturers located in British Columbia and Los Angeles. Through 2016, Herman Market significantly modified its business operations by internalizing many of the critical value-adding functions of the design, development and manufacturing process. In doing so, Herman Market was able to increase the quality and sales volumes of its products to create a more controllable and scalable supply chain.

Herman Market was originally founded by Raif Adelberg, who remains as the creative director and executive of the business. Mr. Adelberg is one of Canada's best-known creative icons, having worked with leading brands such as Wings and Horns and Herschel. Mr. Adelberg is well respected as a fashion and streetwear cultural leader internationally.

Upon completion of the proposed transaction, Gulfstream will continue as a platform that focuses on building a balanced and diversified consumer group with emphasis on favouring branded operating companies in the premium apparel, footwear and accessories sectors. The focus will be on organically growing the existing brands through a global, omni-channel distribution strategy while continuing to seek opportunities to acquire accretive, complementary, premium brands. The retail and consumer goods industries will change more in the next 10 years than they have over the past 40 according to Accenture Strategy. Retailers and consumer goods companies could potentially unlock $2.95-trillion in value over the coming decade by accelerating digital transformation.

The proposed transaction

Gulfstream is expected to acquire 100 per cent of the common shares of Herman Market. In consideration for all of the issued and outstanding securities of Herman, Gulfstream will issue 19,913,514 common shares of Gulfstream. The shares being issued by Gulfstream will be subject to such trade restrictions as may be imposed under applicable securities laws, including any required pooling or escrowing required by the exchange.

It is anticipated that the LOI is to be superseded by a definitive agreement between Gulfstream and Herman Market, with such agreement to include representations, warranties, conditions and covenants typical for a transaction of this nature. The proposed transaction is subject to, among other things, receipt of the requisite shareholder approval of Herman Market, final approval of the TSX Venture Exchange and the satisfaction of customary closing conditions, including the conditions described below.

The proposed transaction is expected to constitute the company's qualifying transaction, pursuant to Policy 2.4, Capital Pool Companies, of the exchange.

The proposed transaction is not a non-arm's-length qualifying transaction pursuant to Section 2.1 of the policy, and, as such, the company is not required to obtain shareholder approval for the proposed transaction. Gulfstream will change its name to Diversified Portfolio Consumer Group Inc. (DPCG) or such other name as may be acceptable to the exchange (the company after the proposed transaction being referred to herein as the resulting issuer).

It is currently anticipated that under the proposed transaction, each shareholder of Herman Market will receive Gulfstream shares in exchange for Herman Market shares held by such holder.

Further details about the proposed transaction and the resulting issuer will be provided in a comprehensive press release when the parties enter into a definitive agreement and in the disclosure document to be prepared and filed in respect of the proposed transaction.

Proposed DPCG financing

In connection with the proposed transaction, the company will look to complete a best-efforts private placement for gross aggregate proceeds of approximately $2.2-million, through the sale of common shares at a price per share of 30 cents. DPCG intends to use the net proceeds of the DPCG financing for general corporate overhead and Herman Market operations, which includes production of the spring-summer 2018 collection, autumn-winter 2018 sample collection, continued enhancement of the e-commerce store, marketing/PR and general operating.

Conditions to proposed transaction

Completion of the proposed transaction is subject to certain conditions precedent, including, among other things:

• Closing of the DPCG financing;
• Completion of satisfactory due diligence investigations by each of Gulfstream and Herman Market;
• Approval of the proposed transaction by the board of directors of each of Herman Market and Gulfstream;
• Approval of the proposed transaction by Herman Market shareholders;
• Receipt of any and all required consents, waivers and approvals from the exchange, any securities regulatory authority and any other third party having jurisdiction, including approval from the exchange for the proposed transaction as its qualifying transaction and the listing of the resulting issuer shares on the exchange.

Sponsorship of a qualifying transaction is required by the exchange unless exempt in accordance with exchange policies. Gulfstream is currently reviewing the requirements for sponsorship and may apply for an exemption from the sponsorship requirements pursuant to the policies of the TSX Venture Exchange; however, there is no assurance that Gulfstream will ultimately obtain this exemption. Gulfstream intends to include any additional information regarding sponsorship in a subsequent press release.

Proposed management and board of the resulting issuer

It is currently anticipated that all of the current officers and all but one of the current directors of Gulfstream will resign from their respective positions with Gulfstream. Upon completion of the transaction, the board of DPCG will comprised five members, of which Gulfstream will appoint one, Herman Market will appoint two and a strategic adviser to Herman Market will appoint two. Subject to exchange approval, on completion of the proposed transaction, it is currently anticipated that the board of directors of the resulting issuer will be Dean Linden, Gordon Devin, Rhonda Klatik, Mr. Adelberg and Mark Korol.

Ms. Klatik will serve initially as DPCG's chief executive officer. Ms. Klatik was instrumental as managing director and head of national sales in growing Sentry Investments into one of the largest independent investment companies in Canada, from $2-billion in assets to over $16-billion in assets during her tenure. She brings a strong retail network of financial advisers across the country and has shown tremendous ability in strategic planning and business development.

Non-executive board members

Mr. Devin has had a 21-year career as a merchant, retailer and leader in the apparel space. Mr. Devin most recently held the position of senior vice-president, general manager (global), for Lululemon and was responsible for global sales in excess of $2.4-billion. Previously, Mr. Devin was the divisional general manager for BONDS, Australia's largest apparel brand with over 4,000 doors of direct retail and digital. He was responsible for the overall performance and profitability of BONDS clothing. Mr. Devin holds a bachelor of business from the University of Technology Sydney.

Mr. Linden is the co-founder and managing partner of Cypress Hills Partners. Cypress Hills Partners is a boutique alternative merchant banking firm based out of Vancouver. The company specializes in the origination of private equity, specialty private debt and other uniquely structured products. Mr. Linden has over 20 years of experience as a financier and business development professional. He has spearheaded public companies in consumer finance, biotech, health care, media, entertainment and natural resource sectors. From 2012 to 2015, Mr. Linden was a founding executive and part of the successful build of Falco Resources, a public company listed on the TSX Venture Exchange.

Mr. Korol holds a bachelor of arts and bachelor of commerce in finance from the University of Windsor, and obtained his certified public accountant designation in Virginia in 2003 as well as his chartered financial analyst designation in 1992. Mr. Korol most recently was the chief financial officer for Xela Enterprises Ltd. (October, 2005, to December, 2016), a holding company with a wide range of commercial ventures. He is a director of Blue Planet Environmental Inc. (formerly a public company listed on the Frankfurt Stock Exchange) and is a director of Ellipsiz Communications Ltd., listed on the TSX Venture Exchange. Previously, Mr. Korol has acted as the CFO for CDI Education Corp., a public company listed on the Toronto Stock Exchange, and Zenon Environmental Inc., a TSX-listed water technology and treatment company. Mr. Korol has his Institute of Corporate Directors designation (ICD.D).

Gulfstream advance and loan to Herman Market

On the signing of the LOI, Gulfstream has provided a $25,000 non-refundable deposit to Herman Market. In addition, on exchange approval, Gulfstream will lend $225,000 to Herman Market as a refundable secured interest-bearing loan.

Further information

Further details about the proposed transaction and the resulting issuer will be provided in a comprehensive press release when the parties enter into a definitive agreement and in the disclosure document to be prepared and filed in respect of the proposed transaction. Investors are cautioned that, except as disclosed in the disclosure document to be prepared in connection with the proposed transaction, any information released or received with respect to the transaction may not be accurate or complete and should not be relied upon. Trading in the securities of a capital pool company should be considered highly speculative.

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