Mr. Scott Young reports

VALENS GROWORKS ANNOUNCES $25 MILLION BOUGHT DEAL FINANCING

Valens Groworks Corp. has entered into an agreement with AltaCorp Capital Inc., under which AltaCorp Capital has agreed to purchase, as co-lead underwriter and sole bookrunner, along with Mackie Research Capital Corp. as co-lead underwriter and including Beacon Securities Ltd., on a bought deal basis, 12,820,513 units of the company at a price of $1.95 per unit, representing aggregate gross proceeds to Valens of approximately $25-million.

Each unit entitles the holder to acquire, for no additional consideration, one common share of Valens and one-half of one common share purchase warrant of Valens. Each full warrant will entitle the holder thereof to purchase one common share of the company at a price of $2.54 per common share, for a period of 24 months following the closing date. In the event that the volume-weighted average trading price of the common shares for 10 consecutive trading days exceeds $3.81, the company shall have the right to accelerate the expiry date of the warrants upon not fewer than 15 trading days notice.

In addition, Valens has agreed to grant to the underwriters an option to purchase up to an additional 15 per cent of the units at a price of $1.95 per unit, on the same terms and conditions as the offering, exercisable at any time, in whole or in part, until the date that is 30 days following the closing of the offering. If the option is exercised in its entirety, the aggregate gross proceeds of the offering to Valens will be approximately $28.75-million.

The company plans to use the net proceeds from the offering to increase extraction capacity at the company's Kelowna facility, to strategically increase the company's domestic geographic presence and for general corporate purposes.

The common shares will be offered by way of a short-form prospectus to be filed in each of the provinces of Canada, other than the province of Quebec, and by way of a private placement in the United States. The offering is expected to close on or about Oct. 10, 2018, and is subject to certain conditions, including, but not limited to, the receipt of all necessary approvals, including the approval of the Canadian Securities Exchange.

About Valens Groworks Corp.

Valens Groworks is a vertically integrated provider of Canadian cannabis products developed from its proprietary extraction techniques, with three wholly owned subsidiaries located in and around Kelowna, B.C. Subsidiary Valens Agritech has initiated cannabis production, processing and sales under a Health Canada dealer's licence, which includes a supply agreement with Canopy Growth Corp. under its extensive CraftGrow distribution network. Subsidiary Supra THC Services is a Health Canada-licensed ISO 17025-accredited cannabis testing lab, providing sector-leading analytical services, and has partnered with Thermo Fisher Scientific to develop a centre of excellence in plant-based medicine analytics. Subsidiary Valens Farms is in the process of becoming a purpose-built facility in compliance with European Union (EU) good manufacturing practice (GMP) standards, ensuring the product from this facility can be exported anywhere in the world where cannabis is nationally legal for medical or adult usage purposes.

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