Aleafia Health Provides Further Update On Its Convertible Debt

Aleafia Health Inc. ALEAF is providing a corporate update regarding its outstanding listed unsecured convertible debentures AH, issued on June 27, 2019 and maturing on June 27, 2022.

Key Points:

• Entered into forbearance agreement with holders representing 58% of total debentures
• Negotiating a potential transaction to amend the convertible debt terms for all debenture holders

• Further to the company’s announcement on January 4, 2022, Aleafia Health is advancing towards achieving a beneficial outcome for all its stakeholders.

  The company has entered into a forbearance agreement with debenture holders representing 58% of the debentures’ aggregate principal amount outstanding. An ad hoc steering committee comprised of certain debenture holders, and represented by Bennett Jones, has been established that will help facilitate ongoing negotiations surrounding the convertible debt. The forbearance agreement’s initial term extends to February 28, 2022, and the agreement automatically renews for 14-day periods thereafter unless notice to the contrary is provided.

  Under the agreement, the holders, among other considerations, forebear in enforcing their rights or remedies against the Company under the Indenture and otherwise at law with respect to the non-payment of interest until the expiry of the term. The Company, in turn, has agreed to certain customary and standard covenants regarding carrying on business in the ordinary course during the term.

  Under the agreement, the holders and the company have agreed to work expeditiously and in good faith to negotiate a potential transaction to amend the terms associated with the convertible debt. There can be no assurance that the negotiations will result in a transaction.

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