Embark Health – Investment Update

MMJ Group Holdings Limited (ASX:MMJ) (“MMJ”), is an Australian-listed company whose core business is holding minority investments across along the cannabis value-chain in Australia, Canada and Europe. MMJ is also able to make investments in sectors outside of cannabis, such as but not limited to, natural resources, pharmaceuticals and software services technology.

Embark Health Update

In the attached release Embark Health Inc. (“Embark” or the “Company”) announced that it has been granted an amendment to its Health Canada licence for the sale of cannabis extracts, cannabis topicals and edible cannabis products from their facility in Delta, British Columbia.

The amendment to the Health Canada licence permits sales of Cannabis 2.0 products directly to Canadian Provinces & Territories and allows the Company to further expand its existing and future product offerings to the medical and recreational consumer markets with concentrates, extracts and nanoemulsified topical and edible products.

MMJ has a minority holding in Embark (refer below).

Further detail on the operations of Embark Health may be found on the MMJ website www.mmjgh.com.au/portfolio/.

MMJ’s investment in Embark Health

MMJ was a foundation investor in Embark Health in July 2018 – the investment has a book value of $13.6m and now comprises:

1. 3.697m ordinary shares (approximately 12.7% shareholding) in Embark Health with a book value of CAD2.44 per share.
2. Warrants that provide the option for MMJ to acquire a further 1.0m shares at CAD1.75 each up with maturity date of two years after a Liquidity Event¹.
3. Warrants that provide the option for MMJ to acquire a further 1.2m shares at CAD1.20² each up with maturity date of two years after a Liquidity Event.
4. Warrants that provide the option for MMJ to acquire a further 1.125m shares at CAD4.80 each up with maturity date of two years after a Liquidity Event.
5. MMJ had generated a total return³ of 1.8 times on its investment.

_{¹ A Liquidity event is an initial public offering or a material sale event}

_{² Exercise price has based on MMJ book value of CAD2.44 per share}

_{³ The return comprises all cash income, sale proceeds, accrued income and fair value of investment at date of calculation}

View the full Embark Health Investment Update here