Mr. Michael Forbes reports

ADASTRA HOLDINGS ANNOUNCES RECORD SINGLE PURCHASE ORDER FOR OVER $1M

Adastra Holdings Ltd. has received a purchase order (PO) for $1,047,439 from the Alberta Gaming, Liquor & Cannabis (AGLC).

Adastra's PO from the AGLC is the largest single PO in Adastra's history. The PO was secured by the company in early February and included a wide range of Adastra's product mix, including offerings from its in-house brand, Endgame Extracts. This PO signals the strong position the Endgame brand has in Alberta, which, according to Headset, holds four of the top 10 selling concentrate brands (1) and two of the top 10 selling vapour pen brands (1).

Chief executive officer update

On Feb. 29, 2024, Michael Forbes resigned as CEO, director and corporate secretary, effective March 29, 2024. Mr. Forbes will be focusing on his other ventures in the cannabis and health space, including Ageless Living, longevity-based interdisciplinary clinics.

The company is currently in the process of selecting and approving a new CEO, and hopes to make an announcement later this month. Mr. Forbes has advised the board of directors of his willingness to support Adastra during this period of transition to ensure an orderly leadership transition to his successor.

"When Michael joined Adastra in April, 2021, the company's quarterly revenues stood at $1.2-million. Fast forward nearly three years, and we're thrilled to receive our largest single purchase order to date, exceeding $1-million. This order is nearly the same amount as the quarterly revenue figure from when Michael first joined. This remarkable milestone underscores Michael's profound impact as CEO, driving revenue growth and scaling operations at Adastra," said Lachlan McLeod, chief financial officer. "We thank Michael for his leadership and guidance during his tenure as CEO. As Michael plans to focus his time on his other ventures, we extend our best wishes for his continued success."

"It has been an honour and privilege to have served as CEO of Adastra during this significant restructuring phase. I am proud of where the company is today. Receiving our largest single purchase order of over $1-million is truly a testament to the hard work and dedication of our team. This milestone reflects not only our commitment to excellence but also the trust and confidence our customers have in our premium products," said Mr. Forbes, CEO of Adastra.

"As we move forward, I am confident that Adastra will continue to thrive and achieve even greater success. I am committed to ensuring a smooth transition to the next management team. I want to express my deepest gratitude to everyone who has been part of this journey, from our employees to our shareholders and partners. Together, we have overcome challenges and seized opportunities, and I am excited to see what the future holds for the company. Adastra means to the stars, and I still believe that to this day."

About Adastra Holdings Ltd.

Adastra has become one of Canada's leaders in the supply and manufacturing of ethnobotanical and cannabis products for lawful adult use. It serves medical markets and engages in forward-looking therapeutic applications. With cannabis concentrate products sold through retailers at more than 2,000 locations across Canada, Adastra's Phyto Extractions and Endgame Extracts brands are now well established with a growing distribution presence. As a Health Canada-licensed facility, it specializes in extraction, distillation and manufacturing of a range of cannabis-derived products. Adastra partners with health care professionals and practitioners within the regulated environment to create products suitable for the medical cannabis market, with the ultimate aim of addressing the needs of patients.

We seek Safe Harbor.

(1) See Headset website.