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Harvest Enterprises Completes Reverse Takeover

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William Sumner
November 14, 2018

Harvest Enterprises Inc. announced that it has closed its reverse takeover (RTO) of RockBridge Resources Inc., which will now be known as Harvest Health & Recreation Inc. Harvest Enterprises is just the latest in a growing number of cannabis companies going public in Canada through a reverse takeover.

Most recently, Cresco Labs LLC went public on the Canadian Securities Exchange (CSE) through an RTO of Vancouver-based Randsburg International Gold Corp., and Acreage Holdings, one of the largest vertically integrated cannabis companies in the U.S., has also announced plans to go public through an RTO.

As part of the RTO, the company created a three-class voting structure for shareholders, taking effect on November 14, 2018. Holders of subordinate voting shares are entitled to one vote per share on all matters to be voted on by shareholders. Multiple Voting shareholders are entitled to 100 votes per share, and Super Voting shareholders are entitled to 200 votes per share.

The RTO was made possible through a series of actions; including an exchange of shares between existing shareholders of the acquired company, a share exchange between existing holders of common shares of Harvest FINCO, Inc., and an amalgamation among the Corporation, Harvest Finco Canada and 1185928 B.C. Ltd.

In conjunction with the RTO, HVST Finco (Canada) Inc. also announced that it has completed a brokered private placement offering.

Co-led by Eight Capital, Canaccord Genuity Corp. and GMP Securities L.P, the offering issued 33,305,294 subscription receipts of the company at a price of $6.65 per subscription receipt. The offering generated in total $218,149,676 in gross proceeds. Upon the closing of the offering, the subscription receipts were converted into common shares in the capital of Harvest Finco Canada and subsequently exchanged into subordinate voting shares of the company.

Harvest Health has received conditional approval from the CSE to lists its subordinate voting shares. The shares are expected to commence trading under the symbol “HARV” on November 15, 2018.