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Supreme Cannabis Completes $100 Million Bought Deal Convertible Debenture Offering

October 19, 2018

/THIS NEWS RELEASE IS INTENDED FOR DISTRIBUTION IN CANADA ONLY AND IS NOT INTENDED FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR DISSEMINATION IN THE UNITED STATES./

TORONTO, Oct. 19, 2018 /CNW/ - The Supreme Cannabis Company, Inc. ("Supreme Cannabis" or the "Company") (TSXV: FIRE) (OTCQX: SPRWF) (FRA: 53S1), is pleased to announce that, further to its news release dated September 27, 2018, the Company has completed its bought deal offering for gross proceeds of $100 million, including the exercise in full of the underwriters' over-allotment option (the "Offering"), comprised of 6.0% senior unsecured convertible debentures (the "Debentures") of Supreme Cannabis at the issue price of $1,000 per Debenture, with a syndicate of underwriters, co-led by GMP Securities L.P. and BMO Capital Markets, and including Cormark Securities Inc., Eight Capital, Beacon Securities Limited and P.I. Financial Corp.

The Debentures will have a maturity date that is 36 months from the closing date of the Offering (the "Maturity Date") and will bear interest from the date of closing at 6.0% per annum, payable semi-annually on June 30 and December 31 of each year. The Debentures will be convertible, at the option of the holder, into common shares of the Company ("Common Shares") at any time prior to the close of business on the last business day immediately preceding the Maturity Date at a conversion price of $2.45 per Common Share (the "Conversion Price"), subject to adjustment in certain circumstances. The Company may force the conversion of the principal amount of the then outstanding Debentures at the Conversion Price on not less than 30 days' notice should the daily volume weighted average trading price of the Common Shares be greater than $3.43 for any 10 consecutive trading days. Further details on the debentures can be found in the Company's filings on www.sedar.com.

The Company intends to use the net proceeds of the Offering for the construction and development of its existing and planned facilities in Canada. This includes the Company's facility in Kincardine, Ontario under construction and the development and construction of a facility on land purchased by the Company that is situated adjacent to such facility. The balance of the net proceeds will be used for general working capital purposes. In addition, the Company views the completion of the Offering as an important milestone in qualifying for graduation to the Toronto Stock Exchange alongside other leading mature licensed producers in the Canadian cannabis industry.

The Debentures were offered and sold by way of a short form prospectus filed in each of the provinces of Canada, excluding Quebec.

Listing and Trading on the TSX Venture Exchange

The TSX Venture Exchange (the "Exchange") has accepted the listing of the Debentures and they commence trading on the Exchange under the stock symbol FIRE.DB on October 23, 2018.

The securities being offered have not been, nor will they be, registered under the United States Securities Act of 1933, as amended, and may not be offered or sold in the United States or to, or for the account or benefit of, U.S. persons absent registration or an applicable exemption from the registration requirements. This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any State in which such offer, solicitation or sale would be unlawful.

About Supreme Cannabis

The Supreme Cannabis Company (TSXV: FIRE) (OTCQX: SPRWF) (FRA: 53S1) is a Canadian publicly traded company committed to providing premium brands and products that proudly reflect its consumers, people and uniquely innovative culture. The Company's portfolio includes its wholly-owned subsidiary and flagship brand 7ACRES.  

7ACRES is a federally licensed producer of cannabis operating inside a 342,000-square-foot facility in Kincardine, Ontario. 7ACRES is dedicated to providing consumers with a premium-quality product that recognizes its customers are informed, discerning and value a brand and culture that aligns with their principles. 7ACRES brand success has been reflected in provincial supply agreements, where 7ACRES' product is consistently listed in the highest brand category available to recreational consumers.

The Company's growing portfolio also includes an equity investment and long-term global distribution partnership with Lesotho-based Medigrow for the exporting of medical-grade cannabis oil. 

The Supreme Cannabis Company has consistently set the standard for innovation in the sector, including the design of growing facilities and development of operational excellence metrics. We are confident that together with our flagship brand, proprietary technology and products, truly unique culture, and industry-leading team, we will deliver our shareholders consistent long-term value creation.

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Forward-Looking Information

Certain statements made in this press release may constitute forward-looking information under applicable securities laws. These statements may relate to anticipated events or results and include, but are not limited to, expectations regarding the use of the net proceeds of the Offering, qualification for graduation to the Toronto Stock Exchange and other statements that are not historical facts. Particularly, information regarding our expectations of future results, targets, performance achievements, prospects or opportunities is forward-looking information. Often, but not always, forward-looking statements can be identified by the use of forward-looking terminology such as "may", "will", "expect", "believe", "estimate", "plan", "could", "should", "would", "outlook", "forecast", "anticipate", "foresee", "continue" or the negative of these terms or variations of them or similar terminology. Forward-looking statements are current as of the date they are made and are based on applicable estimates and assumptions made by us at the relevant time in light of our experience and perception of historical trends, current conditions and expected future developments, as well as other factors that we believe are appropriate and reasonable in the circumstances. However, we do not undertake to update any such forward-looking information whether as a result of new information, future events or otherwise, except as required under applicable securities laws in Canada. There can be no assurance that such estimates and assumptions will prove to be correct.  Many factors could cause our actual results, level of activity, performance or achievements or future events or developments to differ materially from those expressed or implied by the forward-looking statements, including, without limitation, the factors discussed in the "Risk Factors" section of the Company's Annual Information Form dated October 2, 2018 ("AIF"). A copy of the AIF and the Company's other publicly filed documents can be accessed under the Company's profile on the System for Electronic Document Analysis and Retrieval ("SEDAR") at www.sedar.com. The Company cautions that the list of risk factors and uncertainties described in the AIF is not exhaustive and other factors could also adversely affect its results. Readers are urged to consider the risks, uncertainties and assumptions carefully in evaluating the forward-looking information and are cautioned not to place undue reliance on such information.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

SOURCE The Supreme Cannabis Company, Inc.

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