A group of shareholders opposes the plan of arrangement between Emerald Health Therapeutics and Skye Biosciences Inc.

MONTREAL, August 4, 2022 /CNW Telbec/ – Certain shareholders (the “Opposite Shareholders“) of Emerald Health Therapeutics Inc. (“emerald“) (CSE: EMH); (OTCQX: EMHTF), announce that they oppose the announced plan of arrangement (the “To plan“) Between Emerald and Skye Biosciences Inc. (“Skye“) (OTCQB: SKYE).

Opposition to the regime

On November 29, 2021, Emerald has announced that it is leaving the recreational and medical cannabis business and focusing on the pharmaceutical industry. It announced that it had engaged a consulting firm to identify potential acquisition/merger candidates.

Six months later, the May 12, 2022Emerald announced the plan and said it “found” a merger candidate – Skye – after a search.

But the ad was dishonest as no such research was done, nor was it ever necessary as Skye is a company in the Emerald group of companies. Skye and Emerald are controlled by Emerald Health Sciences Inc. (“Sciences“), Emerald’s largest shareholder. The three companies are related by common shareholders, directors and officers. All three are or were under the direction of Avtar Dhillon, Punish Dhillon and Jim Hepell.

Other problematic facts include:

  • Skye is a Science Borrower and owes it $2.5 million, and therefore provides no financial benefit to Emerald under the Plan. Skye has incurred significant losses and expects to continue to experience significant losses and negative cash flow from operations in the future. By contrast, Emerald had cash reserves of approximately $16 million like a March 31, 2022and holds significant non-cash assets, including those of its main subsidiary Verdelite Science Inc. (“Verdelite“).
  • No independent assessment of Skye or Emerald has been made or is offered. Emerald’s value is significantly higher than Skye’s value, but Emerald’s directors intend to burden Emerald shareholders with Skye’s liabilities and reduce the outlook, which can only benefit insiders. and related parties of Skye.
  • Emerald’s shareholders have been harmed by mismanagement and built-in conflicts of interest with the Dhillon family who run its affairs, and have lacked and continue to lack qualified independent executives with a proven track record in operating businesses. profitable businesses.
  • A particular concern is Avtar Dhillona former longtime executive at all three companies, who was arrested by the FBI for securities fraud on August 6, 2021and was also accused by the US Department of Justice (“MJ”) and the Security and Exchange Commission (“SEC”) for securities fraud in connection with alleged pump and dump schemes conducted with Frederick Sharp. Sharp is accused of leading a 1 billion US dollars fraud scheme in Vancouver involving more than 100 issuers.
  • Dhillon’s nephew Punish Dhillon is the CEO and President of Skye, and according to their SEDAR filings, he worked with one of the same issuers as Avtar Dhillon that are swallowed up in the DOJ and SECOND case with Frederick Sharp.
  • Opposing shareholders fear that Punish Dhillon will participate in Emerald and become its CEO and President, if the plan is accepted.
  • The Emeraude group faces a new SECOND investigation concerning another of its group companies, Emerald Health Pharmaceuticals Inc. (“Pharmacy”), for suspected securities fraud. The same players – Avtar Dhillon, Punish Dhillon and Jim Hepell – were part of this entity as well as the other three entities. Punish Dhillon is the Director of Pharmaceuticals and Jim Hepell is his chair.
  • These same two – Jim Hepell and Punish Dhillon – were directors of Emerald Health Bioceuticals Inc.another member of the Emerald group of companies, when it filed for bankruptcy in California on October 20, 2020.
  • Between 2015 and 2020, Emerald paid Sciences more than $15 million in professional fees for various management consulting services. Sciences is not a management consulting company with management consulting experts according to research conducted by opposing shareholders. The purpose of the payment of these exorbitant fees and its recipients remain unknown.
  • Emerald has accumulated over $240 million losses since 2015, while Sciences has taken more than $50 million fees paid and disposals of Emeraude shares, including financing in 2018 of more than 6 million shares sold for $5 per share. Shares are trading at plus or minus 5 cents for several months.
  • The following links to media reports are worth reading in addition to this release:

https://www.vancouverisawesome.com/bc-news/bc-cannabis-company-loses-bid-to-suppress-disaffected-shareholder-5410361

https://www.richmond-news.com/bc-news/time-ticking-for-vancouver-man-charged-in-1b-international-stock-fraud-scheme-4767826

About opposing shareholders

The opposing shareholders are recognized entrepreneurs and business leaders who have successfully navigated the cannabis ecosystem for many years. They are the founders and former owners of Verdélite, formerly known as Agro-Biotech Inc. In May 2018, Agro-Biotech Inc. was acquired by Emeraude.

Opposing shareholders oppose the plan and the Dhillons’ continued involvement in the management of Emerald, as well as the continued involvement of Jim Hepell in the management of Emerald. They informed Emerald management of their opposition to the plan.

The opposing shareholders are calling on the securities regulators to act quickly and reissue the management cease trade order on Emerald shares, and postpone the annual and special meeting of shareholders. They intend to exercise all legal rights available to them to oppose the plan, remove former Emerald executives, and improve the outlook and prospects for all Emerald shareholders.

The information contained in this press release does not constitute and is not intended to constitute a solicitation of a proxy within the meaning of applicable corporate or securities laws or otherwise.

Shareholders are not invited to sign a proxy in support of the opposition of shareholders opposing the plan or any other resolution relating to Emerald’s annual and special general meeting to be held on August 19, 2022.

SOURCE Concerned shareholders of Therapeutic Health Emerald

© Canada Newswire, source Canada Newswire English


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