Mr. Nicholas Bergamini reports

ALEAFIA HEALTH ANNOUNCES $35 MILLION PUBLIC OFFERING OF 8.5% CONVERTIBLE DEBENTURE UNITS

Aleafia Health Inc.'s offering, previously announced on June 5, 2019, will be for an offering size of $35-million. The offering will be conducted on an agency basis for the issuance of 35,000 convertible debenture units of the company at a price of $1,000 per convertible debenture unit. The offering is being led by Mackie Research Capital Corp. and BMO Capital Markets, on behalf of a syndicate of agents including Canaccord Genuity Corp.

The company will also grant the agents an option to cover overallotments and for market stabilization purposes, exercisable at any time up to 30 days subsequent to the closing of the offering, to increase the size of the offering by up to 15 per cent in convertible debenture (and/or the components thereof) on the same terms and conditions of the offering, exercisable in whole or in part.

Each convertible debenture unit will consist of one 8.5-per-cent unsecured convertible debenture and 680 common share purchase warrants of the company. Each warrant shall entitle the holder thereof to purchase one common share in the capital of the company at an exercise price of $1.55 at any time up to 36 months following closing of the offering. Provided that if, at any time prior to the expiry date of the warrants, the volume weighted average trading price of the common shares on the Toronto Stock Exchange is greater than $3.10 for 20 consecutive trading days, the company may, within 15 days of the occurrence of such event, deliver a notice to the holders of warrants accelerating the expiry date of the warrants to the date that is 30 days following the date of such notice. Any unexercised warrants shall automatically expire at the end of the accelerated exercise period.

The convertible debentures shall bear interest at a rate of 8.5 per cent per annum from the date of issue, payable semi-annually in arrears on the last day of June and December in each year and will have a maturity 36 months from the date of issuance. The principal amount of each convertible debenture shall be convertible, for no additional consideration, into common shares of the company at the option of the holder at any time prior to the earlier of: (i) the close of business on the maturity date and (ii) the business day immediately preceding the date specified by the company for redemption of the convertible debentures upon a change of control at a conversion price equal to $1.47.

The net proceeds received by Aleafia Health from the offering are intended to be used for working capital requirement and other general corporate purposes.

Aleafia Health will use commercially reasonable efforts to obtain the necessary approvals to list the convertible debentures, warrants and the common shares issuable upon conversion of the convertible debentures on the TSX.

Upon a change of control of the company, holders of the convertible debentures will have the right to require the company to repurchase their convertible debentures, in whole or in part, on the date that is 30 days following the giving of notice of the change of control, at a price equal to 104 per cent of the principal amount of the convertible debentures then outstanding plus accrued and unpaid interest thereon. If 90 per cent or more of the principal amount of the convertible debentures outstanding on the date of the notice of the change of control have been tendered for redemption, the company will have the right to redeem all of the remaining convertible debentures at the offer price.

The company will file an amended and restated preliminary short-form prospectus in respect of the offering later today.

The closing of the offering is currently expected to be on or about June 26, 2019, and is subject to certain conditions including, but not limited to, the execution of an agency agreement and the receipt of all necessary regulatory approvals including the approval of the TSX.

About Aleafia Health Inc.

Aleafia Health is a leading, vertically integrated cannabis health and wellness company with four primary business units: cannabis cultivation and products, health and wellness clinics, cannabis education, and consumer experience with e-commerce, retail distribution and provincial supply agreements. Aleafia Health owns three major cannabis product and cultivation facilities, two of which are licensed and operational. Aleafia Health produces a diverse portfolio of commercially proven, high-margin derivative products including oils, capsules and sprays. Aleafia Health operates the largest national network of medical cannabis clinics and education centres staffed by medical doctors, nurse practitioners and educators.

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