Cresco Labs Inc. (CNSX:CL) entered into a definitive agreement to acquire all of the issued and outstanding shares of Bluma Wellness Inc. (CNSX:BWEL.U) from SOL Global Investments Corp. (CNSX:SOL) and others for approximately $220 million on January 13, 2021. Under the terms of the Transaction, shareholders of Bluma will receive 0.0859 of a subordinate voting share of Cresco Labs (“Cresco Shares”) for each Bluma Share held (the "Exchange Ratio"), subject to adjustment. The Exchange Ratio implies a price per Bluma Share of approximately $1.12, representing a premium of approximately 29% based on the closing price of Bluma Shares on the CSE as of January 13, 2021. The Transaction will be completed by way of plan of arrangement under the Business Corporations Act (British Columbia). The Exchange Ratio is subject to adjustment in the following circumstances: (i) if the 5-day volume weighted average price of Cresco Shares immediately preceding the 2nd business day prior to the closing of the Transaction (the "Cresco Closing Price") is below $9.99 but greater than $7.00, the Exchange Ratio per Bluma Share will be calculated as $0.86 divided by the Cresco Closing Price; and (ii) if the Cresco Closing Price is less than or equal to $7.00, the Exchange Ratio will be fixed at 0.1229 Cresco Shares for each Bluma Share. The agreement contains termination fee in the amount of $7.5 million payable by Bluma in the event that the arrangement is terminated in certain circumstances. As of February 12, 2021, SOL Global Investments shareholders executed voting and support agreement in which SOL Global Investments transferred its 16,891,749 common shares and 6,450,000 common share purchase warrants of Bluma Wellness Inc. to various arm's length parties in private market transactions and consideration received per Common Share and per Warrant under the Dispositions was $1, for total consideration received of $23.3 million which resulted in approximately 10.57% decrease in the SOL Global Common Share holdings.

The Transaction is subject to, among other things, the approval of Bluma shareholders at a special meeting (the "Special Meeting"), and receipt of all required CSE, third-party, stock exchange, regulatory approval including State of Florida Department of Health Office of Medical Marijuana Use and court approvals, including clearance under the Hart-Scott-Rodino Antitrust Improvements Act, Dissent Rights have not been exercised (excluding any dissent rights that have been exercised and subsequently withdrawn) with respect to more than 5% of the issued and outstanding Company Shares, The Key Employees shall have entered into employment agreements or shall have amended their existing employment agreements in form and substance satisfactory to the Cresco Labs, Each of the Company Locked-up Shareholders shall have entered into the Lock-up Agreements, in form and substance satisfactory to the Purchaser, acting reasonably. Based on the advice and recommendation of the Special Committee, the board of directors of Bluma determined that the Transaction is fair to the shareholders of Bluma, that the Transaction is in the best interests of Bluma and unanimously recommends that Bluma shareholders vote in favor of the resolution to approve the Transaction at the Special Meeting. Shareholders of Bluma holding approximately 40% in aggregate of Bluma Shares have executed voting and support agreements in favor of the Transaction. Certain Bluma shareholders will also agree not to transfer a portion of their resulting Cresco Shares for up to an eight-month period following closing of the Transaction. The board of directors of Bluma formed a special committee of independent members (the “Special Committee”) to review and recommend the approval of the Transaction by the board of directors. The Court issued the Interim Order on February 11, 2021 and, subject to the approval of the Arrangement by the Bluma Shareholders, a hearing for the Final Order approving the Arrangement will be held. A special meeting of the shareholders of Bluma Wellness will be held on March 19, 2021 to approve the transaction. It is currently anticipated that, subject to receipt of all required approvals, the transaction will be completed by the start of the second quarter of 2021.

As on March 11, 2021, the transaction received expiration of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976. The shareholders of Bluma Wellness approved the transaction on March 19, 2021. Bluma will apply to the Court for the Final Order to approve the Arrangement on March 25, 2021, unless adjourned. As of March 26, 2021, Bluma has obtained a final order of the Supreme Court of British Columbia approving the acquisition. The deal is expected to close in second quarter of 2021.

Cowen is acting as financial advisor to Cresco Labs and provided a fairness opinion to the Company's board of directors. Aaron Sonshine of Bennett Jones LLP is acting as legal advisor to Cresco Labs. Clarus Securities Inc. and INFOR Financial Inc. are acting as financial advisors to Bluma and each provided a fairness opinion to the board of directors of Bluma. Peter Simeon of Gowling WLG (Canada) LLP is acting as legal advisor to Bluma. Odyssey Trust Company acted as Depository for Cresco Labs and The Depository Trust Company acted as Transfer Agent for Bluma.

Cresco Labs Inc. (CNSX:CL) completed the acquisition of Bluma Wellness Inc. (CNSX:BWEL.U) from SOL Global Investments Corp. (CNSX:SOL) and others for approximately $210 million on April 13, 2021. Prior to the completion of the transaction, SOL Global held an indirect economic interest in approximately 36.3% of Bluma shares. Cresco Labs now has meaningful operations in 10 states. Total consideration for the acquisition was consisted of 15.1 million SVS issued as of the acquisition date, 4.7 million equity-classified warrants issued valued at $18.4 million, 0.8 million replacement shares valued at $10.0 million, deferred consideration of $1.8 million, and settlement of preexisting loan relationships of $21.2 million.