Mr. Edoardo Mattei reports

RED WHITE & BLOOM BRANDS' SUBSIDIARY, EMBLEM CANNABIS, SELECTED AS SUCCESSFUL BIDDER TO ACQUIRE HEALTH CANADA-LICENSED MANUFACTURING OPERATIONS, LEADING VAPE & PRE-ROLL BRANDS, AND EXPANDED NATIONAL DISTRIBUTION CAPABILITIES

Red White & Bloom Brands Inc.'s wholly owned subsidiary, Emblem Cannabis Corp., has been selected as the successful bidder in the court-supervised sale and investment solicitation process (SISP) approved by the Ontario Superior Court of Justice (Commercial List) in connection with the insolvency proceedings of Ayurcann Holdings Corp. and Ayurcann Inc. under the Companies' Creditors Arrangement Act (CCAA).

Assets to be acquired

The transaction is structured as a share purchase, pursuant to which Emblem will indirectly acquire the underlying businesses, assets, licences and operations through ownership of 100 per cent of the newly issued shares of Ayurcann. Certain excluded assets and liabilities of Ayurcann will be vested in an affiliate of Ayurcann (as defined below) and will not be transferred as part of the transaction. Upon closing of the transaction, Emblem will acquire a comprehensive processing and manufacturing platform, including:

• Established brand portfolio: the Fuego, Xplor, and Happy & Stoned brands, together with all associated intellectual property, trademarks and brand assets. Ayurcann's portfolio spans over 90 tracked SKUs (stock-keeping units) available through approximately 2,500 retail locations across Canada, with a particular focus on the high-growth vape and preroll categories;
• Production facility and equipment: Ayurcann's cannabis formulation, manufacturing and packaging operations based in Pickering, Ont., including Ayurcann's interests in operational equipment and inventory, and other strategic assets;
• Commercial relationships and records: all retained contracts, customer and supplier relationships, distribution, and supply arrangements across eight provinces and territories, and all associated books and records of the business;
• Licences: subject to regulatory approval, all government licences required to operate the Ayurcann business.

Strategic rationale

The proposed acquisition of Ayurcann's operations represents a strategically compelling addition to Emblem's existing Canadian cannabis platform. Ayurcann's recognized leadership in the vape and preroll segments, combined with its established national retail distribution network and Health Canada-licensed processing infrastructure in Pickering, Ont., is expected to provide Emblem with significant scale, processing capacity and brand breadth.

The transaction is expected to generate synergies across the combined operations, including supply chain leverage, reduced finished goods costs and G&A (general and administrative) rationalization, while materially expanding the combined entity's share of the Canadian recreational cannabis market.

Management commentary

"We are very pleased that Emblem has been selected as the successful bidder for Ayurcann," said Colby De Zen, president of Red White & Bloom. "This acquisition is highly strategic and will immediately scale our Canadian platform with a leading portfolio in the fastest-growing product categories and a national distribution footprint across more than 2,500 retail locations. Beyond the brands and infrastructure, we are acquiring a proven operating platform with meaningful synergies across supply chain, manufacturing and overhead. We look forward to integrating the Ayurcann business and its team, and believe this transaction positions RWB to drive accelerated growth and enhanced shareholder value upon closing."

Background and CCAA sale process

On Jan. 30, 2026, Ayurcann Inc. and its parent, Ayurcann Holdings Corp., obtained creditor protection under the CCAA pursuant to an initial order of the court, with Alvarez & Marsal Canada Inc. appointed as court-appointed monitor to oversee the proceedings.

On Feb. 13, 2026, the court issued a sale process approval order approving the SISP to solicit interest in Ayurcann's business and assets on an "as is, where is" basis.

Emblem participated in the SISP and tendered a binding agreement of purchase and sale. Following the bid deadline, Emblem's bid was selected as the successful bid. The transaction remains subject to court approval and the satisfaction of customary closing conditions. The purchase price for the transaction will be payable in cash on closing with the support of facilities generally available to Emblem. The closing is currently anticipated to take place no later than May 15, 2026.

About Red White & Bloom Brands Inc.

Red White & Bloom Brands is a multijurisdictional cannabis operator and house of premium brands operating in the United States, Canada and select international jurisdictions.

We seek Safe Harbor.