Synstream Energy Corp. (TSX-V:SHM) (‘Synstream') has entered into a non-binding letter of intent (‘LOI') to acquire up to a 66.6% stake in Kamcan Products Inc. (‘Kamcan') from Sundial Growers Inc. (‘Sundial') on October 25, 2017. The transaction is structured as the purchase of 66.6% of the issued and outstanding common shares of 10370738 Canada Inc. (‘Holdco'), the sole shareholder of Kamcan. The letter of intent contemplates that Synstream will fund construction of the required building as contemplated by Kamcan's ACMPR application in exchange for common shares of Holdco. Pursuant to the transaction 1262430 Alberta Ltd., a corporation wholly owned by Johannes Kingma, would acquire 13.4% of Holdco shares and Sundial would hold 20% of the Holdco shares. As part of the transaction, Synstream intends to raise up to CAD 7.5 million through the issuance of common share units and through unsecured convertible debentures. Each common share unit will consist of one common share and one common sharepurchase warrant entitling the holder thereof to acquire one additional common share of Synstream for a period of one year after the issuance subject to acceleration of that expiry date in certain circumstances.

Completion of the transaction is subject to a number of conditions including negotiation and execution of a definitive agreement, receipt of all required regulatory approvals, including approval of the TSX Venture Exchange and completion of due diligence by each of Sundial, 1262430 Alberta and Synstream.