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Origin House Announces Conversion of Debentures to Further Strengthen its Balance Sheet

Origin House Announces Conversion of Debentures to Further Strengthen its Balance Sheet

OTTAWA, Feb. 26, 2019 /CNW/ - CannaRoyalty Corp. d/b/a Origin House (CSE: OH) (OTCQX: ORHOF) ("Origin House" or the "Company"), a leading North American cannabis products and brands company, today announced that the Company has elected to exercise its rights under the indenture dated July 12, 2018 (the "Indenture"), governing the Company's 8% unsecured convertible debentures due July 12, 2021 (the "Debentures") to convert the principal amount of the outstanding Debentures to common shares of the Company ("Common Shares").



Pursuant to the Indenture, Origin House may convert the outstanding Debentures into Common Shares at the conversion price of C$6.25 per Common Share in the event that the volume weighted average trading price of the Common Shares on the Canadian Securities Exchange (the "Exchange") is greater than C$9.00 for 10 consecutive trading days (a "Mandatory Conversion Event").

The Company confirms that as of the close of markets on February 25, 2019, a Mandatory Conversion Event had occurred. In accordance with the terms of the Indenture, Origin House has delivered notice of the Mandatory Conversion Event to registered holders of Debentures (the "Debenture holders"), which, combined with this news release, constitutes notice to the Debenture holders of the Mandatory Conversion Event. Accordingly, the Company confirms that on March 28, 2019 (the "Mandatory Conversion Date"), the then outstanding Debentures will be deemed to be surrendered for conversion to Common Shares.

The Debentures currently trade on the Exchange under the ticker symbol 'OH.DB', and, in accordance with CSE procedures, will be halted at 12:00pm EST and delisted at market close on the Mandatory Conversion Date.

Early Voluntary Debt Conversion

On July 12, 2018 Origin House raised approximately C$33 million in aggregate gross proceeds from the issuance of 32,980 Debentures, bearing interest at a rate of 8% per annum and maturing on July 12, 2021 (subject to a Mandatory Conversion Event). As of the close of market on February 25, 2018, approximately C$20.5 million of the total C$33 millionraised had already been converted to equity on a voluntary basis, representing 62% of the Debentures issued pursuant to the Indenture.

In addition to strengthening our balance sheet by eliminating the debt and the corresponding interest expense, the early voluntary conversion of the majority of the outstanding debt is a testament to investor confidence in our company's strategy and the strength of Origin House common equity

stated Marc Lustig, Chairman and CEO of Origin House.

On conversion of the outstanding Debentures, the total number of Origin House shares outstanding will be 72.2 million (including Common Shares and Class A shares).

About Origin House

Origin House is a growing cannabis products and brands company operating across key markets in the U.S. and Canada, with a strategic focus on becoming a preeminent global house of cannabis brands. The Company's foundation is in California, the world's largest regulated cannabis market, where it delivers over 130 branded cannabis products to the majority of licensed dispensaries. Origin House's brand development platform is operated out of five licensed facilities located across California, and provides distribution, manufacturing, cultivation and marketing services for its brand partners. The Company is actively developing infrastructure to support the proliferation of its brands internationally, initially through its acquisition of Canadian retailer 180 Smoke. Origin House's shares trade on the Canadian Securities Exchange (CSE) under the symbol "OH" and on the OTCQX under the symbol "ORHOF". Origin House is the registered business name of CannaRoyalty Corp. For more information, visit www.originhouse.com.

Forward Looking Statements

Statements in this news release that are forward-looking statements are subject to various risks and uncertainties concerning the specific factors disclosed here and elsewhere in Origin House's periodic filings with Canadian securities regulators. When used in this news release, words such as "will, could, plan, estimate, expect, intend, may, potential, believe, should," and similar expressions, are forward- looking statements.

Forward-looking statements may include, without limitation, statements relating to the timing and completion of the transactions and agreements contemplated in this press release, timing for conversion of the Debentures, the Company's outstanding share capital following conversion of the Debentures, the execution of the Company's strategy, new opportunities, the Company's timing and process for expansion in Canada and globally, timing for the Company's acquisition of 180 Smoke, new opportunities, future growth and other statements.

Although the Company has attempted to identify important factors that could cause actual results, performance or achievements to differ materially from those contained in the forward-looking statements, there can be other factors that cause results, performance or achievements not to be as anticipated, estimated or intended, including, but not limited to: dependence on obtaining regulatory approvals; investing in target companies or projects that are engaged in activities currently considered illegal under US federal law; changes in laws; limited operating history; reliance on management; requirements for additional financing; competition; hindering market growth and state adoption due to inconsistent public opinion and perception of the medical-use and adult-use marijuana industry and; regulatory or political change.

There can be no assurance that such information will prove to be accurate or that management's expectations or estimates of future developments, circumstances or results will materialize. As a result of these risks and uncertainties, the results or events predicted in these forward-looking statements may differ materially from actual results or events.

Accordingly, readers should not place undue reliance on forward-looking statements. The forward-looking statements in this news release are made as of the date of this release. The Company disclaims any intention or obligation to update or revise such information, except as required by applicable law, and the Company does not assume any liability for disclosure relating to any other company mentioned herein.

SOURCE Origin House


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