Ms. Anne Chopra reports

HARVEST ONE SIGNS DEFINITIVE AGREEMENT TO ACQUIRE ACMPR LICENSED MEDICAL CANNABIS PRODUCER UNITED GREENERIES AND SWISS MEDICAL CANNABIS-BASED HEALTH PRODUCTS COMPANY SATIPHARM AG

Further to its previous news release, Harvest One Capital Inc. has signed a definitive agreement with an Australian Securities Exchange-listed company, MMJ Phytotech Ltd., pursuant to which Harvest One will, subject to certain conditions, acquire 100 per cent of the issued and outstanding shares of United Greeneries Holdings Ltd. and Satipharm AG, both wholly owned subsidiaries of MMJ (together, the spin-out companies), by way of a share exchange agreement dated Dec. 6, 2016.

The transaction provided for in the definitive agreement constitutes the company's qualifying transaction under the policies of the TSX Venture Exchange, is an arm's-length transaction and will not require approval of the shareholders of Harvest One, and is subject to MMJ shareholder approval, which will be sought at a meeting of shareholders on Jan. 9, 2017.

Further, the definitive agreement provides that:

• The company will acquire all the outstanding shares of the spin-out companies in exchange for a combination of shares and cash as set out below, and immediately following a one-to-1.79 share consolidation, for an aggregate deemed purchase price of $42-million.
• The company will issue 53,333,333 postconsolidated shares to MMJ at an ascribed price of 75 cents per share and pay $2-million cash to MMJ. Harvest One presently has 4,493,120 fully diluted shares outstanding, consisting of 4,093,120 common shares outstanding and 400,000 options outstanding at a 10-cent conversion price.
• The transaction will be accompanied by a concurrent financing for gross proceeds of at least $15-million (or such other amount as may be agreed by the parties and sufficient to meet minimum TSX-V listing requirements). The financing is expected to be completed by way of a private placement.
• Harvest One is expected to be renamed Sol Growth Corp. following successful recapitalization.
• Upon conclusion of the transaction, it is expected that the company will be a Tier 1 or 2 life sciences or industrial issuer, and MMJ will be an insider of the resulting issuer by virtue of holding more than 10 per cent of the issued and outstanding common shares of the resulting issuer.
• Other than the incoming board of directors and management of the resulting issuer, as disclosed below, the company does not anticipate any additional insiders being formed on completion of the transaction.

About the incoming board of directors and management

The anticipated board of directors and management of the resulting issuer are as set out below.

Andreas Gedeon, Dipl-Paed -- proposed chief executive officer and director

Mr. Gedeon, a former officer in the German Navy, holds a degree in educational science from the University of Federal Armed Forces Munich. He is an experienced businessman with proven expertise in large-scale and HR-intensive projects. His previous areas of business include media production, horticulture and commercial construction. As the founder of MMJ, Mr. Gedeon currently oversees the global expansion strategy of the MMJ group.

Peter Wall, LLB, BComm, MAppFin, FFin -- proposed chairman

Mr. Wall is a corporate lawyer based in Perth, Western Australia, and is a partner at one of Australia's leading corporate and commercial law firms. He graduated from the University of Western Australia in 1998 with a bachelor of laws and bachelor of commerce (finance), and subsequently completed a master of applied finance and investment with FINSIA (formerly the Securities Institute of Australia).

Mr. Wall was a founding director and shareholder in Phytotech Medical Ltd., the first medical cannabis company to list on the ASE, which was subsequently renamed to MMJ Phytotech Ltd. after a merger with MMJ Biosciences Inc.

Mr. Wall has a wide range of experience in all forms corporate and commercial law, with a particular focus on mergers and acquisitions, initial public offerings, backdoor listings and capital markets transactions.

Mr. Wall is the non-executive chairman of ASX-listed companies MMJ, Minbos Resources Ltd., Activistic Ltd., MyFiziq Ltd., Zyber Holdings Ltd., Sky and Space Global Ltd., and Transcendence Technologies Ltd., and he is also a non-executive director of Ookami Ltd.

Jason Bednar, BComm, CA -- proposed director

Mr. Bednar is a chartered accountant with more than 18 years of direct professional experience in the financial and regulatory management of companies listed on the Toronto Stock Exchange, TSX-V, American Stock Exchange and ASX.

He is currently the chief financial officer and director of Canacol Energy Ltd., a Colombian-focused oil and gas exploration and production company with an enterprise value of approximately $650-million (U.S.).

Mr. Bednar has been the past CFO of several international oil and gas exploration and production companies, most notably the founding CFO of Pan Orient Energy Corp., a Southeast Asian exploration company, which during his tenure grew organically to operate 15,000 barrels of oil per day and had a market capitalization of $700-million. He previously sat on the board of directors of several internationally focused exploration and production companies, including being the past chairman of Gallic Energy Ltd.

Mr. Bednar holds a bachelor of commerce degree from the University of Saskatchewan.

Anne Chopra, BComm, MIR (Queen's), JD -- proposed director

Ms. Chopra is a director of Caracara Silver Inc., a junior mining exploration company listed on the TSX-V (since July, 2011). In addition, since August, 2008, Ms. Chopra held the office of president, CEO, CFO and director of Harvest One, a capital pool company trading on the NEX board of the TSX-V (since August, 2008). Ms. Chopra served as vice-president, corporate and legal affairs, with Potash One Inc., a TSX-listed resource issuer from November, 2007, to its buyout in a $430-million cash transaction in March, 2011. Ms. Chopra has practised corporate, commercial and securities law with private regional law firms in British Columbia (since February, 1997). Ms. Chopra is also the equity ombudsperson for the Law Society of British Columbia, a role she has held since May, 1999, and is the recipient of the 2006 CBA Equality and Diversity award for her work in this field. Ms. Chopra also holds a BComm degree and doctor of law degree (JD) from the University of Alberta, and a master of industrial relations from Queen's University.

Kwong Choo, CPA, CGA -- proposed CFO

Mr. Choo is a certified general accountant with over 15 years of experience in senior financial roles and public company reporting experience to the company, having previously served as CFO and vice-president of finance and administration with Wex Pharmaceuticals Inc., a TSX-listed biotechnology company. Mr. Choo earned a degree in management accounting from the Chartered Institute of Management Accountants, U.K., in 1990, and holds a CGA designation in Canada.

Will Stewart -- proposed director

Mr. Stewart is a seasoned strategic public affairs adviser with significant experience working in both the public and private sectors. Mr. Stewart is currently a managing principal at Navigator Inc., a leading Canadian public strategy and communications firm, where he provides strategic planning, research and communications counsel to clients in a diverse variety of sectors. Mr. Stewart is also the founding principal of Ensight, a strategic partnership of Canadian communications and public affairs firms Enterprise and Navigator. Prior to joining Navigator and founding Ensight, Mr. Stewart served as chief of staff in several portfolios to Ontario ministers responsible for energy and social services, as well as the government whip and house leader. Mr. Stewart has a deep understanding of complex financial transactions, such as foreign investment, sovereign wealth funds, and how these issues are viewed by the public and government. Mr. Stewart was honoured to be chosen by the Hill Times as a member of its top 100 lobbyists for six consecutive years and was awarded the Queens Diamond Jubilee medal for his contributions to Canadian public policy.

About the spin-out companies

The resulting issuer will be a growth-oriented cannabis producer and cannabis-based health products company focused on supplying Canadian and international cannabis markets through two distinct operating brands:

• United Greeneries -- Canadian ACMPR (access to cannabis for medical purposes regulations) licensed producer with focus on large-scale horticultural operations for the upcoming Canadian recreational cannabis market;
• Satipharm -- international medical cannabis brand with focus on oral delivery technologies for strategic entry in emerging medical cannabis markets and the existing medical cannabis market in Canada.

About United Greeneries

United Greeneries is a Canadian ACMPR licensed producer and will be the spin-out companies' horticultural arm and recreational brand. United Greeneries' Duncan facility is licensed to cultivate medical marijuana by Health Canada pursuant to the ACMPR. Management anticipates that the Duncan facility will be issued an ACMPR full-distribution licence in the second quarter of 2017. The Lucky Lake facility is at the ACMPR security-clearance stage of review.

Duncan facility

On June 30, 2016, MMJ advised that Health Canada had officially approved United Greeneries as an authorized licensed producer at the United Greeneries' flagship Duncan facility under the MMPR (marijuana for medical purposes regulations). MMJ's Duncan facility is a state-of-the-art cannabis cultivation operation with approximately 10,000 square feet of cultivation area and high-compliance items such as a Level 8 narcotics vault and a full-service in-house biochemical and analytical laboratory. With cultivation capacity of approximately 1,000 kilograms per year, Duncan has significant excess processing capacity that can be potentially used later by United Greeneries to process internal or third party materials. On Aug. 13, 2016, United Greeneries executed a binding letter of intent with Cowichan Tribes to option over 13 acres of a 40-acre land package immediately adjacent to the existing Duncan facility for the purposes of large-scale greenhouse expansion of the Duncan facility. United Greeneries has developed a preliminary three-phase Duncan greenhouse expansion plan for the full 40-acre land package that, if fully implemented, would result in the Duncan facility's production capacity growing from about 1,000 kilograms per year to an estimated 57,500 kilograms per year by year-end 2020.

Lucky Lake facility

The Lucky Lake facility in Lucky Lake, Sask., is a 62,000-square-foot modern concrete agricultural facility sitting on over 18 acres of land which is 100 per cent owned by United Greeneries. The facility includes a potential residential property for future employees and has a vast supply of water and electricity. The Lucky Lake facility's MMPR application was submitted in March, 2015, and is currently in the security-clearance stage of review. Once licensed, Lucky Lake's cannabis cultivation capacity is estimated to be up to 11,700 kilograms of cannabis per annum.

Satipharm AG

Satipharm is specialized in the development and manufacturing of cannabis-based health products and will be the company's medical and health brand. Based in Lucerne, Switzerland, Satipharm is a European pharmaceutical, nutraceutical and cosmeceutical company. Satipharm is specialized in the development and production of dietary supplements and cosmetics with a focus on legally accessible cannabidiol (CBD). Satipharm also has worldwide exclusive rights to the Gelpell microgel process for all cannabis applications.

From this development originated CBD Gelpell microgel capsules, a CBD product with a unique, controlled delivery system with enhanced oral bioavailability. Satipharm's vision is to become a global leading company in cannabis-based products using advanced delivery systems this segment through the development and commercialization of cannabidiol-based products and cannabis-based products.

Satipharm has historical revenue of approximately $255,340 (Australian) for the year ending June 30, 2016.

Satipharm Gelpell microgel capsules

Satipharm began production of its Gelpell microgel capsules in May, 2015, and is committed to boosting the sales of its flagship product throughout regulated markets globally. The capsules use GACP/GMP produced cannabis extract from Satipharm's partner Ai Fame GmbH/Ai Lab Swiss AG, which fulfills all criteria of the European Pharmacopeia and contains 92 per cent purified CBD, with no THC or other cannabinoids present. The extract is then processed under an exclusive technology-use agreement by Gelpell AG into proprietary microgelatine spheres and packaged under GMP protocols into a 10-milligram, a 50-milligram and a 100-milligram presentation.

Gelpell microgel

Satipharm has worldwide exclusive rights to the Gelpell microgel process for all cannabis applications. The Gelpell microgel process results in seamless gelatin pellets under two millimetres containing a payload rich in cannabinoids. The cannabinoids are bound and protected by three-dimensional natural gelatin matrix. This in situ microemulsion ensures accurate and consistent dosages and substantially enhances the bioavailability of the cannabinoids. Satipharm has sublicensed the pharmaceutical cannabis application of Gelpell microgel process to Phytotech Therapeutics, MMJ's Israel-based subsidiary responsible for the company's research and development and clinical development activities. Phytotech Therapeutics is currently using the Gelpell microgel process in two prescription drugs that are about to enter phase 2 clinical studies. The Gelpell microgel process was chosen as the oral delivery system in the phase 2 studies after phase 1 studies showed that the Gelpell outperformed the commercially available Sativex, demonstrating superior CBD plasma profile. Satipharm extended an existing marketing agreement with Gelpell AG with a licence agreement for exclusive use of the Gelpell microgel technology in pharmaceuticals after the phase 1 results.

Satipharm marketing

Satipharm is currently preparing a significant marketing campaign to drive sales of 10-milligram and 50-milligram Satipharm Gelpell microgel capsules, focusing first on Germany and Poland, followed by entry into 10 additional EU countries in April, 2017. Further expansion plans include the introduction of a medical purposes food supplement product and a dermatology product in select EU countries commencing in May, 2017.

Satipharm plans to introduce Gelpell microgel products into the Canadian MMPR market and the Australian market, and is in the process of developing strategies to quickly achieve this. Satipharm also plans to license or introduce products into regulated cannabis markets internationally.

Completion of the transaction is subject to a number of conditions, including but not limited to, diligence investigations by the respective parties, receipt of applicable corporate approvals, completion of the concurrent financing, and TSX-V, ASX and other regulatory approvals. 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.

The company will be seeking a waiver of any requirement for sponsorship required under TSX-V policy in reliance on the financing. Additional information will be provided in a subsequent news release before the company's shares resume trading.

We seek Safe Harbor.