Mr. Eugene Hodgson reports

EFFICACIOUS ELK CAPITAL CORP. ANNOUNCES PROPOSED QUALIFYING TRANSACTION WITH FRONTIER WELLNESS MANAGEMENT INC.

Efficacious Elk Capital Corp. has entered into a letter of intent dated July 15, 2019, for the acquisition of Frontier Wellness Management Inc., a private company incorporated pursuant to the laws of British Columbia. Upon completion of the proposed transaction, the business of Frontier will become the business of EECC.

EECC is a capital pool company and the proposed transaction is intended to constitute the company's qualifying transaction under Policy 2.4 of the TSX Venture Exchange. The proposed transaction does not constitute a non-arm's-length qualifying transaction (as defined in Policy 2.4 of the exchange) and, accordingly, will not require the approval of EECC's shareholders.

All amounts referred herein are in Canadian dollars unless otherwise indicated.

About Frontier Wellness Management

Frontier is engaged in the business of acquiring and operating companies engaged in retail medicinal cannabis and cannabis derivatives in Spain.

Frontier was incorporated by articles of incorporation dated Feb. 19, 2019, under the Business Corporations Act (British Columbia). The registered and records office of Frontier is located at 910, 800 West Pender St., Vancouver, B.C., V6C 2V6. Approximately 22 per cent of the outstanding common shares of Frontier are held by John D. MacPhail, who resides in British Columbia.

Frontier has entered into a memorandum of understanding with Maeva SL, a Spanish corporation, Rucal SL, a Spanish corporation and the wholly owned subsidiary of Maeva, and Joan de Haro Arjona, Oscar Barros Garcia, Carlos Florencio Bello Herrero and Josep Anton Sanchez, Spanish residents each of whom holds 25 per cent of the outstanding securities of Maeva. Pursuant to the terms of the memorandum of understanding, Maeva and Frontier will enter into a definitive agreement with respect to the acquisition of Rucal, whereby Frontier will acquire all of the outstanding shares of Rucal from Maeva in exchange for 24 million common shares of Frontier. Frontier will also make a one-million-euro equity investment into Rucal and will advance an additional two million euros of working capital to Rucal.

Rucal, operating as Medcan, owns and operates the first and only retail medical clinic in Barcelona, Spain, specializing in educating patients on the therapeutic use of cannabis and the sale of CBD products. Further, Medcan has an agreement with a Barcelona-based laboratory to develop a suite of hemp-based CBD products and has entered into an agreement with a Spanish-based distribution company to introduce that product line to the Spanish pharmacy market. Medcan also provides educational seminars to individuals, associations and medical professionals regarding cannabis and its use as a means of improving wellness.

Rucal has secured a licensed location for a cannabis club where members will have access to medical cannabis products, including those containing THC (tetrahydrocannabinol). Construction for this location is under way and is expected to be completed by September with full operations by October.

Rucal is also in negotiations to secure a second licensed location offering members similar products and services. This site is also under construction with similar targeted completion and operation dates.

Frontier expects the acquisition of Rucal to close prior to or concurrently with the qualifying transaction.

As of its fiscal year-end of June 30, 2019, Frontier's unaudited financial statements show that it has $1.53-million of current assets that are part of its $1,538,000 total assets. Frontier has current liabilities of $50,000 and total liabilities of $50,000. Frontier had no revenue and general expenses totalling $180,000 in the financial year ended June 30, 2019. All amounts disclosed in this paragraph are unaudited.

At the date of this news release, there is no available detailed financial information in respect of Rucal; however, an audit of Rucal will be completed and provided to EECC as part of the due diligence process.

Terms of the proposed transaction

Pursuant to the terms of the LOI, EECC and Frontier will complete a business combination, whereby EECC will acquire all the common shares of Frontier and the business of Frontier will become the business of the resulting issuer. The shareholders of Frontier will receive one common share of EECC for every common share of Frontier currently held. The transaction shares will be issued to the shareholders of Frontier pursuant to exemptions from the registration and prospectus requirements of applicable securities laws. The transaction shares may be subject to resale restrictions as required under the applicable securities legislation or, if required, the policies of the exchange, and may also be subject to escrow restrictions pursuant to the policies of the exchange.

In connection with the proposed transaction, the resulting issuer will change its name to a name acceptable to Frontier, subject to approval by the applicable regulatory authorities.

It is expected that upon completion of the proposed transaction, the resulting issuer will be listed as a Tier 2 industrial or technology or life sciences issuer on the exchange.

In addition, the parties have agreed that a $100,000 break fee will be payable to EECC by Frontier, provided Frontier terminates the LOI under certain conditions.

Proposed private placement and concurrent financing

Prior to the closing of the proposed transaction, Frontier will complete an equity financing or financings for minimum aggregate gross proceeds of $3-million at prices commensurate with market conditions, of which approximately $1.7-million has already been raised by Frontier, with the most recent round of financing being completed at a price of 25 cents per share and further rounds contemplated to be at not less than 25 cents per share.

Concurrent with the closing of the proposed transaction, either Frontier, EECC or a combination of Frontier and EECC will complete a further equity financing or financings for minimum gross proceeds of $3-million at a price currently intended to be 30 cents per share, but in any event not less than 25 cents per share. All securities issued by EECC pursuant to the concurrent private placement will be subject to a hold period of four months and one day.

The proceeds of the private placement and concurrent financing will be used to finance the costs associated with completing the Rucal acquisition, the proposed transaction and for general working capital of the resulting issuer, as applicable.

EECC may pay a commission commensurate with industry norms and in accordance with the policies of the exchange in connection with the concurrent financing. It is not known at this time whether any investment dealer or other registrant will be engaged to assist with fundraising activities in connection with the concurrent financing or private placement.

Share consolidation of EECC

Prior to the completion of the proposed transaction, EECC will complete a share consolidation on a one-for-1.7 basis (one postconsolidated share for 1-7/10 of a preconsolidated share). The share consolidation is subject to the approval of the shareholders of EECC.

Capitalization of the resulting issuer

There are currently 22,701,650 issued and outstanding common shares of Frontier. As a result of the Rucal acquisition, Frontier will issue a further 24 million common shares to the shareholders of Rucal. This will result in EECC issuing an aggregate of 46,701,650 postshare consolidation common shares to the shareholders of Frontier, exclusive of any shares issued in exchange for shares issued in the private placement or concurrent financing. These numbers will be adjusted accordingly to account for any common shares issued by Frontier in connection with the private placement or concurrent financing.

There are currently 6,100,005 EECC common shares issued and outstanding, as well as 610,000 stock options currently exercisable at 10 cents and expiring 10 years from the date of issuance, and 400,000 warrants of EECC currently exercisable at 10 cents and expiring two years from the date of issuance. Following the share consolidation, there will be 3,588,238 EECC postshare consolidation common shares issued and outstanding, as well as 358,823 postshare consolidation stock options exercisable at 17 cents and 235,294 postshare consolidation warrants of EECC exercisable at 17 cents.

Upon completion of the proposed transaction: (i) all EECC common shares to be issued to the holders of Frontier's common shares may be subject to resale restrictions under securities laws and the policies of the exchange, as applicable; and (ii) all common shares held by principals (as such term is defined in the policies of the exchange) of EECC and the resulting issuer will be held in escrow in accordance with the policies of the exchange.

Sponsorship

Sponsorship of a qualifying transaction is required by the TSX Venture Exchange unless exempt in accordance with the TSX-V policies. EECC intends to apply to the TSX-V for a waiver of the TSX-V's sponsorship requirements; however, there is no assurance that EECC will ultimately obtain an exemption or waiver from sponsorship.

Conditions precedent

The parties' obligations to complete the proposed transaction are subject to the satisfaction of customary conditions precedent, including:

• All necessary approvals of the exchange, and all other regulatory authorities and third parties to the proposed transaction, including the concurrent financing, being obtained;
• The approval or consent by shareholders of Frontier of the proposed transaction, which has been obtained to the extent applicable;
• Frontier completing the Rucal acquisition;
• EECC completing the name change and share consolidation on the terms set forth above;
• The private placement and concurrent financing having been completed;
• The parties have been satisfied with the results of their respective due diligence reviews in connection with the proposed transaction;
• The exchange conditionally accepting the common shares of the resulting issuer for listing, subject to the resulting issuer fulfilling the listing requirements of the exchange.

Directors, officers and insiders of resulting issuer

On completion of the proposed transaction , the directors, officers and insiders of the resulting issuer are anticipated to be the following individuals:

John D. MacPhail, chief executive officer, chairman and director

Mr. MacPhail was most recently CEO of I-5 Holdings Ltd., a Canadian company focused on the U.S. retail cannabis market. I-5 was acquired by Captor Capital Corp. after raising $83-million and becoming a public company. Mr. MacPhail is also the chairman of Wealthcraft Capital, a U.S. company focused on pain management treatment through cannabis. Mr. MacPhail is the executive chairman of Frontier Wellness Rx and Green Stripe Naturals. Before entering the cannabis market, Mr. MacPhail worked as an investment banker for approximately 30 years, including working as the CEO of Union Securities, a firmed based out of Vancouver, B.C.

Edward T.L. Cheung, director

Mr. Cheung has over 20 years experience in equity and derivatives sales trading at investment banks in London, Singapore, Seoul and Hong Kong. During his career, he has held positions at JP Morgan, Lehman Brothers, Credit Suisse, RBS, and most recently at State Street Bank & Trust. Since moving to Asia in 1998, Mr. Cheung has been advising and trading Asia Pacific equities, derivatives and exotic products for institutions, asset managers, hedge funds, central banks and sovereign wealth funds. He has been involved in the distribution of some of the biggest initial public offerings in Asia, including ICBC (Industrial & Commercial Bank of China), China CITIC Bank and AIA Group. Mr. Cheung currently holds the position of chief development officer at Pebble Labs Inc., a private biotech company developing innovative solutions to pest control in plants, aquaculture and insects.

Mr. Cheung was awarded a bachelor of science degree from the University College London in economics in 1993, and a master of arts in property valuation and law from City University Cass Business School, London, in 1995.

Joan de Haro Arjona, director

Mr. de Haro is the founder and CEO of Medcan, an MBA and lecturer in international economy at ESADE Business School. Mr. Haro is also the founder of Kalapa Clinic, the first medical cannabis clinic in Europe, which exited in 2015 to bring Medcan to retail. He worked as an international distribution network executive, which included a 15-year career promoting Spanish-made products in the Russian markets for such brands as Roca, Pamesa and Aparici before entering the cannabis market.

Eugene A. Hodgson, director

Mr. Hodgson brings 30 years of private and public sector experience to his position. He began his public sector career in the Northwest Territories where he acted as senior policy adviser on resource-based projects. In the early 1980s he served as executive assistant to the Minister of the Environment, Lands, Parks and Housing in the British Columbia government. He has held a number of senior positions in both the public sector, for the NWT and B.C. governments, and private industry, at International Jetfoil Ltd., First Fund Capital, Intrawest, Sea Breeze Power, Timmins Gold Corp. and Corpfinance International Ltd. as vice-president of the Western region, involving providing advice on finance, public and government policy, and corporate affairs.

He has served on the board of directors of various corporations, including Grandfield Pacific Corp., First Class Systems Inc., Arimex Resources Inc., Equitable Real Estate Investment Corp., Amwest Properties Inc., Sea Breeze Power Corp., Alda Pharmaceuticals Corp., Silvermex Resources Inc., Timmins Gold (Toronto Stock Exchange and New York Stock Exchange), Pacific Cascade Minerals Inc., Maxtech Ventures Inc., and Red Fund Capital Corp. (formerly Parana Copper Corp.), and is the former chair of the board of governors of Vancouver Community College.

He is currently president of Fabled Copper and Gold Corp., an early-stage exploration mining company, and chief financial officer of Trait Biosciences Inc., a cannabis-focused biotechnology company conducting groundbreaking research in cannabinoid cultivation and product development.

Rodney W. Reum, director

Rodney Reum, BComm, CPA, CGA, has over 35 years of experience in business, accounting and finance in both the public and private sectors. Mr. Reum received his bachelor of commerce from the University of Alberta and obtained a professional accounting designation (CGA) shortly thereafter. Mr. Reum was a director, president and chief executive officer of several publicly listed companies on the Canadian, U.S. and German exchanges, and is currently a director of several publicly listed companies. Mr. Reum also consults to both public and private companies in the area of finance, corporate governance and securities compliance.

Robert Wilson, director

Mr. Wilson has a 30-year career in investment management and investment banking, with a particular focus on mergers and acquisitions, corporate governance, and corporate management. During his career, Mr. Wilson has held senior positions in investment banking at BMO Nesbitt Burns, First Marathon Securities, Yorkton Securities and Research Capital. Mr. Wilson has also managed investment portfolios at a major Canadian venture capital firm as well as at a subordinated debt fund that he co-founded in 2014. Most recently, Mr. Wilson held senior positions at two publicly listed cannabis companies, where he was responsible for corporate finance and M&A. Over his career, Mr. Wilson has held board seats and senior executive positions at six public companies listed on the Canadian Securities Exchange and Toronto Stock Exchange.

Ed Duda, chief financial officer

Mr. Duda is a chartered professional accountant with over 30 years of senior industry experience with public and private companies. He holds a bachelor of business administration degree and numerous Canadian Securities Institute accreditations. Mr. Duda is managing director of Delmac Pacific Management Inc., a private organization that provides consulting and advisory services to the financial services, mining, technology and medical industries. Mr. Duda recently served as chief financial officer and corporate secretary of Northern Vertex Mining Corp. and Element Lifestyle Retirement Inc. He has also held senior positions with Haywood Securities Inc., Blackmont Capital Inc. (formerly First Associates Investments Inc. and Yorkton Securities Inc.), Union Securities Ltd., and Omni Vita Custom Wealth Management Inc.

Carlos Florencio Bello Herrero, chief operating officer

Mr. Bello is a global marketing, sales and customer operations executive with over 25 years professional, results-oriented and business management experience. Mr. Bello is a 20-year veteran of Hewlett-Packard, wherein he developed and introduced a newly branded product platform to market, managed the $200-million business inkjet hardware category across EMEA (Europe, Middle East and Africa), and managed the graphic arts experience centre hosting upwards of 12,000 customers and partners annually. He brings a strong foundation in brand management, fast-moving consumer goods, product marketing, business analytics and a sensitivity for customer experience. Mr. Bello also holds an MBA.

David W. Smalley, corporate secretary

Mr. Smalley is the principal of David Smalley Law Corp., where he practises corporate and securities law. He was called to the bar of the Law Society of British Columbia in 1989. Mr. Smalley earned a bachelor of laws degree from the University of British Columbia and a bachelor of arts degree from the University of Victoria. He has been an officer and director of numerous public companies over the last 20 years as well as serving as chair of numerous audit and governance committees.

Trading halt

The shares of EECC will remain halted until completion of the qualifying transaction.

General

Completion of the transaction is subject to a number of conditions, including, but not limited to, exchange acceptance and, if applicable pursuant to exchange requirements, majority of the minority shareholder approval. Where applicable, the transaction cannot close until the required shareholder approval is obtained. There can be no assurance that the transaction will be completed as proposed or at all.

Investors are cautioned that, except as disclosed in the management information circular or filing statement to be prepared in connection with the 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.

All information contained in this news release with respect to EECC and Frontier was supplied by the parties, respectively, for inclusion herein, and EECC and its directors and officers have relied on Frontier for any information concerning Frontier, Maeva or Rucal.

We seek Safe Harbor.