Mr. George Kveton of Invictus reports

INVICTUS AND CANNAMERICA COMBINE TO ENTER HEMP AND CBD MARKET IN THE US

Invictus MD Strategies Corp. has entered into a binding letter of intent to create a joint venture with CannAmerica Brands Corp. and CBDistribution Company Ltd. (CBDC) with the intention of acquiring hemp biomass for extraction into CBD (cannabidiol) isolate using purpose-built facilities for large-scale CBD extraction.

In December, 2018, President Trump signed the $867-billion Farm Bill, which recharacterized hemp from a Schedule 1 drug with high potential for abuse to the lowest-level listed drug (Schedule 5), which includes small doses of medicines such as codeine. This allows for mass hemp production in the United States that is federally legal and the ability to move hemp across state lines. Hemp is defined in the United States as cannabis with less than 0.3 per cent THC (tetrahydrocannabinol). CBD, a non-psychoactive cannabinoid found in cannabis, has had a surge in popularity over the past couple of years based on its huge range of potential health benefits and uses.

Subject to board approval and completion of satisfactory due diligence, Invictus intends to enter into a definitive joint venture agreement on or before Jan. 31, 2019. Each of the parties will receive a one-third share of the joint venture in exchange for its respective contribution:

1. Invictus will contribute a line of credit in the amount of $5-million, which will be used to acquire extraction equipment, build out infrastructure and finance working capital. The line of credit will be secured by a general security agreement over the joint venture and will bear interest at a rate of 5 per cent per year.
2. CannAmerica is a pioneer in the science of cannabis extraction and postprocessing, precision dosing of product, and formulation of concentrates and oil-based vaporization products. The company had sold more than 14 million cannabis-infused gummies in the states of Colorado and Nevada, and it will contribute operational expertise, source the property, extraction equipment and staffing, and manage operations.
3. CBDC will contribute the sourcing of hemp biomass procurement, branding, marketing and the commercialization of the finished product, including, but not limited to, CBD isolate.

"We are thrilled to partner with CannAmerica and CBDC to extract and supply CBD to the U.S. market. This partnership represents a great opportunity to continue expanding our footprint beyond Canada and capitalize on the United States' federal legal framework that is now in place to produce and sell CBD," said George E. Kveton, chief executive officer of Invictus.

"This is a significant partnership for CannAmerica with world-class partners. This joint venture accelerates the company's long-planned growth into the hemp-based CBD market following the passing of the Farm Bill, with extraordinary opportunities for expansion into new markets," said Dan Anglin, chief executive officer and co-founder of CannAmerica.

About Invictus MD Strategies Corp.

Invictus is a global cannabis company offering a selection of products under a wide range of brands. The company's integrated sales approach is defined by five pillars of distribution, including medical, adult use, international, licensed producer to licensed producer and retail stores.

About CannAmerica Brands Corp.

CannAmerica Brands is a U.S.-marine-veteran-founded-and-operated portfolio of cannabis brands with licensing agreements in the states of Colorado, Nevada and Maryland. The company aims to maximize the value of its brands by employing strong brand management teams, marketing and licensing the brands through various distribution channels, including dispensaries, wholesalers and distributors, in the United States and internationally.

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