Mr. Mark Aiken reports

CHRISTINA LAKE CLOSES FIRST TRANCHE OF NON-BROKERED PRIVATE PLACEMENT OF SECURED CONVERTIBLE NOTES

Christina Lake Cannabis Corp., further to the news release dated Sept. 7, 2023, has closed the first tranche of a non-brokered private placement of secured convertible promissory notes in the principal amount of $3.19-million.

The company issued convertible promissory notes secured by land and buildings. The note bears interest at a rate of 15 per cent per annum over a term of 36 months. Repayment of the note shall be in the form of interest only payments for the first 15 months of the term and a blended principal and interest payment for the remaining term. Outstanding principal and interest from the notes will be convertible into common shares at a conversion price of six cents per common share during the term. The company shall also have the right to redeem or repay the notes at any time during the term.

All securities issued pursuant to the offering are subject to a statutory four-month-and-one-day hold period from the date of issuance pursuant to applicable securities laws of Canada.

Proceeds from the offering will be used for repayment of outstanding debentures, working capital and general corporate purposes.

Multilateral Instrument 61-101 disclosure

Certain insiders of the company participated in the first tranche of the offering for an aggregate of $1.8-million in notes. The participation by such insiders is considered a related-party transaction within the meaning of MI 61-101, Protection of Minority Security Holders in Special Transactions. The company has relied on exemptions from the formal valuation and minority shareholder approval requirements of MI 61-101 contained in sections 5.5(b) and 5.7(1)(b), respectively, of MI 61-101, as no securities of the company are listed or quoted on the Toronto Stock Exchange, Aequitas NEO Exchange Inc., the New York Stock Exchange, the American Stock Exchange, the Nasdaq Stock Market or a stock exchange outside of Canada, and neither the fair market value of the notes to be acquired by the participating directors and officers nor the consideration to be paid by such directors and officers exceeds $2.5-million. The company did not file a material change report more than 21 days before the expected closing of the offering as the details of the participation therein by related parties of the company were not settled until shortly prior to closing of the first tranche of the offering and the company wished to close on an expedited basis for sound business reasons.

About Christina Lake Cannabis Corp.

Christina Lake Cannabis is a licensed producer of cannabis under the Cannabis Act, with a standard cultivation licence and corresponding processing amendment from Health Canada, as well as a research and development licence. Christina Lake Cannabis's facility consists of a 32-acre property, which includes over 950,000 square feet of outdoor grow space, offices, propagation and drying rooms, research facilities, and a facility dedicated to processing and extraction. Christina Lake Cannabis also owns a 99-acre plot of land adjoining its principal site. The company focuses its production on creating high-quality extracts and distillate for its B2B (business-to-business) client base with proprietary strains specifically developed for outdoor cultivation to enhance extraction quality.

We seek Safe Harbor.