Harvest Health & Recreation Shareholders and Verano Holdings LLC Members Overwhelmingly Approve Their Business Combination

PHOENIX–(BUSINESS WIRE)–Harvest Health & Recreation, Inc. (CSE: HARVOTCQX: HRVSF) (“Harvest“), a vertically integrated cannabis company with one of the largest and deepest footprints in the U.S., is pleased to announce the results of its June 26, 2019 annual general and special meeting (the “Meeting“) of Harvest shareholders (“Harvest Shareholders“) held to approve, among other things, certain matters relating to Harvest’s previously announced definitive agreement (the “Business Combination Agreement“) for its acquisition (the “Transaction“) of Verano Holdings, LLC (“Verano“). In addition, the members of Verano approved the Transaction overwhelmingly with 100% of the votes cast at a special meeting of its members on June 26, 2019.

As announced by press release dated April 23, 2019, pursuant to the terms of the Business Combination Agreement, securityholders of Harvest and Verano will become securityholders in a combined company which will carry on the business of Harvest and Verano (the “Resulting Issuer“).

The Harvest Shareholders voted overwhelmingly in favor of, among other things:

  • a special resolution (the “Arrangement Resolution“) authorizing and approving the Business Combination Agreement whereby, among other things: (i) Harvest shareholders will exchange their shares in Harvest for equivalent securities in the Resulting Issuer on a 1:1 basis, and (ii) Verano securityholders will be issued a combination of subordinate voting shares and multiple voting shares in the capital of the Resulting Issuer in connection with the indirect exchange of their securities in Verano announced by Harvest on March 11, 2019 (the “Arrangement“);
  • an ordinary resolution to approve the equity incentive plan of the Resulting Issuer;
  • fixing the number of directors for the ensuing year at 5 and the election of Jason Vedadi, Steve White, Mark Barnard, Frank Bedu-Addo and Elroy Sailor as directors of Harvest; and
  • to appoint Haynie & Company as the auditors of Harvest for the ensuing year and to authorize the directors of Harvest to fix their remuneration.

As described in Harvest management information circular dated May 24, 2019, prepared in connection with the meeting (the “Circular“), the Arrangement Resolution required approval by at least 66⅔% of the votes cast, in person or by proxy, at the Meeting by the holders of Harvest’s subordinate voting shares (the “Subordinate Voting Shares“), multiple voting shares (the “Multiple Voting Shares“) and super voting shares (the “Super Voting Shares“, and collectively with the Subordinate Voting Shares and Multiple Voting Shares, the “Harvest Shares“), each voting separately as a class, as well as voting together as a single class.

In addition, the Arrangement Resolution required the affirmative vote of each class of Harvest Shares, excluding those Harvest Shares held by “affiliates” or “control persons” of Harvest within the meaning of OSC Rule 56-501 – Restricted Shares (“OSC Rule 56-501“).

The Transaction remains subject to, among other conditions, court approval, Canadian Securities Exchange approval, approval of the Verano members, certain additional regulatory approvals customary for a transaction of this nature, and the satisfaction or waiver of all closing conditions. The Transaction is expected to close later this year.

Additional information with respect to the Transaction is available in the Circular, which is available on SEDAR under the issuer profile of Harvest at www.sedar.com.

About Harvest Health and Recreation, Inc.

Headquartered in Tempe, Arizona, Harvest Health & Recreation, Inc. is a multi-state cannabis operator (MSO) and vertically-integrated cannabis company. Subject to completion of announced acquisitions, Harvest will have the largest footprint in the U.S., with rights to more than 210 facilities, of which approximately 140 are retail locations, and more than 1,580 employees across 17 states. Since 2011, the company has been committed to aggressively expanding its Harvest House of Cannabis retail and wholesale presence throughout the U.S., acquiring, creating and growing leading brands for patients and consumers nationally and continuing on a path of profitable growth. Harvest’s mission is to improve lives through the goodness of cannabis and is focused on its vision to become the most valuable cannabis company in the world. We hope you’ll join us on our journey: https://harvestinc.com.

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Forward-looking Statements

This press release contains statements which constitute “forward-looking information” within the meaning of applicable securities laws, including statements regarding the plans, intentions, beliefs and current expectations of Harvest with respect to future business activities. Forward-looking information is often identified by the words “may,” “would,” “could,” “should,” “will,” “intend,” “plan,” “anticipate,” “believe,” “estimate,” “expect” or similar expressions and include information regarding: the closing of the Transaction, including satisfaction of the conditions to closing of such acquisitions; the ability of the Company to successfully achieve its business objectives; plans for expansion of Harvest; expectations for other economic, business, and/or competitive factorsexpectations for future financial performance; expected synergies arising from the Transaction; timing and receipt of the required shareholder, court, stock exchange and regulatory approvals for the Transaction; the timing and ability of Harvest and Verano to satisfy the conditions precedent to completing the Transaction; and, the anticipated timing to, and the completion of, the closing of the Transaction.

Investors are cautioned that forward-looking information is not based on historical facts but instead reflects Harvest management’s expectations, estimates or projections concerning future results or events based on the opinions, assumptions and estimates of management considered reasonable at the date the statements are made. Although Harvest believes that the expectations reflected in such forward-looking information are reasonable, such information involves risks and uncertainties, and undue reliance should not be placed on such information, as unknown or unpredictable factors could have material adverse effects on future results, performance or achievements of the Resulting Issuer. Among the key factors that could cause actual results to differ materially from those projected in the forward-looking information are the following: the potential impact of the Transaction on relationships, including with regulatory bodies, employees, suppliers, customers and competitors; failure to achieve expected synergies arising from the Transaction and related integration risk; changes in general economic, business and political conditions, including changes in the financial markets; the ability of the Resulting Issuer to raise debt and equity capital in the amounts and at the costs that it expects; adverse changes in the public perception of cannabis; decreases in the prevailing prices for cannabis and cannabis products in the markets that Harvest operates in; adverse changes in applicable laws; adverse changes in the application or enforcement of current laws, including those related to taxation; the inability to locate and acquire suitable companies, properties and assets necessary to execute on the Company’s business plans; and increasing costs of compliance with extensive government regulation. This forward-looking information may be affected by risks and uncertainties in the business of Harvest and market conditions.

Should one or more of these risks or uncertainties materialize, or should assumptions underlying the forward-looking information prove incorrect, actual results may vary materially from those described herein as intended, planned, anticipated, believed, estimated or expected. Although Harvest has attempted to identify important risks, uncertainties and factors which could cause actual results to differ materially, there may be others that cause results not to be as anticipated, estimated or intended. Harvest does not intend, and does not assume any obligation, to update this forward-looking information except as otherwise required by applicable law.

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