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    Board Renewal and a New Strategy for Liquor Stores

    May 16, 2017

    - PointNorth Capital, Liquor Stores' largest shareholder with approximately 10% ownership, calls for six new, highly-qualified, independent Board members
    - Prior to PointNorth's announcement of its approximately 10% position, the share price had declined from over $20.00 in 2012 to $9.551
    - Since 2010, under the direction of the current Board, Liquor Stores' revenues increased by 41%, while operating profit has declined

    PointNorth Capital Inc., together with certain of its affiliates and associates (collectively, "PointNorth"), the largest shareholder of Liquor Stores N.A. Ltd. ("Liquor Stores" or the "Company"), today released a letter to shareholders and a dissident proxy circular (the "Dissident Circular") urging shareholders to appoint six new, highly-qualified, independent members of Liquor Stores' board (the "Board") to effect real change and pursue a new, clear strategy to realize increased value for all shareholders.

    Shareholders are urged to vote the BLUE proxy form or BLUE voting instruction form for the six new director nominees before 5:00 p.m. (Toronto time) on June 15, 2017.

    The nominees being put forward are independent of PointNorth and bring to Liquor Stores qualifications across a wide number of disciplines, including alcohol beverage retailing, packaged goods, capital markets, private equity and governance. In proposing these nominees, PointNorth declined the existing current Board's earlier offer of two seats on a nine-member Board, noting that to have accepted it would have perpetuated both the entrenchment of the existing Board and the status quo.

    PointNorth is an approximately 10% investor and is not seeking to elect to the Board any of its people. Rather, PointNorth is asking fellow shareholders to support it in effecting real change by electing six new, highly-qualified, independent Board members. "Contrary to Liquor Stores' assertions, control of public companies has not been, and is not, a PointNorth investment objective," said Philip Evershed, Managing Partner at PointNorth Capital. "We endeavor to elect independent Board members to enable Board renewal where we think it will be in the best interests of all shareholders. The objective is a new Board with its own strategy and renewed energy to drive shareholder value. Control of Liquor Stores remains fully in the market as does a control premium should a buyer emerge."

    In addition to putting forward six nominees to the Board, the Dissident Circular outlines a new strategy that significantly differs from the Company's current approach (the "New Strategy"). The Company has strayed from its roots as a convenience offering with a network of smaller stores in prime locations. The New Strategy clearly addresses long-standing issues such as excessive operating costs, which are higher than the Company's peer group. The New Strategy also sets out specific measures to reduce the costs of Liquor Stores' expensive and inefficient inventory management practices which result in the weakest inventory turns among its peers.

    PointNorth believes that the New Strategy will result in a healthier balance sheet and allow for a more efficient allocation of capital to priorities that deliver better bottom-line results, including an accelerated store network renovation plan. These initiatives are expected to reverse the trend of erosion of the Company's market share and declining same store sales in its core Canadian markets. Other highlights of the New Strategy include a commitment to re-evaluate the U.S. diversification strategy that the Company's management acknowledges is facing increasing competitive pressure and a proposal to more tightly align management compensation with the Company's financial and share price performance.

    To oversee the implementation of the New Strategy, PointNorth is nominating the following individuals (none of whom are partners, investor, employees or directors of PointNorth):

    Derek H. Burney
    Mr. Burney is the former Chairman and CEO of Bell Canada International, former President & CEO of CAE Inc. and Former Canadian Ambassador to the United States of America. Mr. Burney is a member of the Board of TransCanada Pipelines Limited, serves on the Advisory Board of Paradigm Capital and on the International Advisory Board for Garda World Security Corporation.

    John R. Barnett, CPA
    Mr. Barnett is the former Chairman and CEO of Rothmans Canada and, prior to that, CEO of Molson Canada and President of Molson USA. He brings to the Board an extensive background in the alcohol beverage and consumer packaged goods industries.

    Karen A. Prentice
    Mrs. Prentice, a lawyer by profession, is a former EVP, Corporate Services and Corporate Secretary of ENMAX Corporation. Mrs. Prentice served for six years as a member of the Alberta Securities Commission where she chaired the Human Resources Committee. She is also the Former Chair of the Board of Trustees of Canmarc Real Estate Investment Trust.

    Kenneth G. Barbet
    Mr. Barbet is the former transformative CEO of the Nova Scotia Liquor Corporation and former CEO of Big Rock Brewery. Mr. Barbet brings to the Liquor Stores' Board a 30-year career in retail focused on alcohol beverage, grocery, pharmacy, and eyeglass retail and consumer packaged goods. Mr. Barbet is currently CEO of Doctors Eye Care Co-Op Ltd.

    James F. C. Burns
    Mr. Burns is a former private equity investor and former Partner at Gordon Investment Corporation where he was responsible for investments including: Specialty Equipment Ltd., Sound Warehouse Inc., Empire Realty Credit Corp., ConCap Equities Inc., Windmill Bakeries, and Shepherd Manufacturing Ltd. Mr. Burns is also a former Managing Director at CIBC Wood Gundy.

    Richard D. Perkins
    Mr. Perkins is a former senior executive responsible for business strategy at the Nova Scotia Liquor Corporation where, for a decade, he held several key positions including VP, Marketing and Communications and VP, Business Development and IT. He also served as an executive and member of senior management with Newcourt Credit Group and CIBC and served as a Director of the Business Development Bank of Canada.

    If you are a shareholder that is disappointed with the performance of your investment and concerned about the Company's future, PointNorth urges you to support its six nominees who will implement real change at Liquor Stores. Please join PointNorth in voting your BLUE proxy form or BLUE voting instruction form for six new directors no matter how many shares you own. The cut-off to receive your proxy is before 5:00 p.m. (Toronto time) by June 15, 2017.

    If you have questions or need help voting, contact Kingsdale Advisors at 1-877-657-5857 or at contactus@kingsdaleadvisors.com. For a full copy of the Dissident Circular and accompanying documents, go to www.FixLIQ.com. The Dissident Circular can also be located at www.sedar.com under Liquor Stores N.A. Ltd.'s issuer profile.

    About PointNorth Capital

    PointNorth, together with its affiliates and associates, is a private equity investment firm formed in Ontario. PointNorth invests, as did its predecessor, in equity and debt situations where it is able to influence operational, financial and strategic direction.

    PointNorth targets companies that are experiencing financial or operational challenges, are in out-of-favour sectors or are otherwise in need of change to drive significant long-term value for stakeholders. PointNorth does not seek to appoint its founders and principals to the boards of directors of companies it invests in, but rather operates by identifying best-in-class independent candidates to nominate for board positions. This commitment to improvements benefits all shareholders, not just PointNorth.

    PointNorth has developed the New Strategy for Liquor Stores with the input of third party alcohol retail industry experts. As at April 21, 2017, PointNorth beneficially owned or controlled or directed, directly or indirectly, an aggregate of 2,750,000 common shares, representing approximately 9.91% of the common shares in the capital of Liquor Stores.

    Additional Information

    The information contained in this press release does not and is not meant to constitute a solicitation of a proxy within the meaning of applicable corporate and securities laws. PointNorth has issued the Dissident Circular to Liquor Stores' shareholders, in compliance with applicable law. Notwithstanding the foregoing, PointNorth is voluntarily providing the disclosure required under section 9.2(4) of National Instrument 51-102 – Continuous Disclosure Obligations in accordance with corporate and securities laws applicable to public broadcast solicitations.

    This press release and any solicitation made by PointNorth is made by or on behalf of PointNorth and not by or on behalf of management of Liquor Stores. PointNorth has engaged a solicitation agent, Kingsdale Advisors ("Kingsdale"), to make proxy solicitations for a fee of $75,000. All costs incurred for any solicitation will be borne by PointNorth, provided that, subject to applicable law, PointNorth may seek reimbursement from Liquor Stores of PointNorth's out-of-pocket expenses, including proxy solicitation expenses and legal fees, incurred in connection with a successful reconstitution of the board at the annual and special meeting (the "Meeting") of Liquor Stores' shareholders.

    Any solicitations of proxies by or on behalf of PointNorth will be solicited pursuant to the Dissident Circular sent to shareholders of the Company after which solicitations may be made by mail, telephone, fax, email or other electronic means, by public announcement and in person by representatives of PointNorth and its proxy advisors Kingsdale, retained by PointNorth. Any proxies solicited by PointNorth may be revoked by instrument in writing by the shareholder giving the proxy or by its duly authorized officer or attorney, or in any other manner permitted by law. Neither PointNorth nor, to its knowledge, any of its associates or affiliates, has any material interest, direct or indirect, by way of beneficial ownership of securities or otherwise, in any matter proposed to be acted on at the Meeting, other than the election of directors.

    Forward-Looking Statements and Information

    Certain statements contained in this press release, constitute forward-looking statements. The words "may", "would", "could", "will", "intend", "plan", "anticipate", "believe", "estimate", "expect" and similar expressions as they relate to Liquor Stores or PointNorth are intended to identify forward-looking statements. Such statements reflect PointNorth's current views and intentions with respect to future events as well as assumptions made by and information currently available to PointNorth, and are subject to certain risks and uncertainties. Although PointNorth considers these assumptions to be reasonable based on the information currently available to it, many factors could cause the actual results, performance, actions or achievements of Liquor Stores or others that may be expressed or implied by such forward-looking statements to materially differ from those described herein should one or more of these risks or uncertainties materialize. Such factors include, but are not limited to, economic, business, competitive and regulatory factors. Readers are cautioned not to place undue reliance on forward-looking statements.

    The forward-looking statements contained herein are expressly qualified by this cautionary statement and are made as of the date of this press release. Except as expressly required by law, PointNorth does not intend, and disclaims any intention or obligation to, update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

    Liquor Stores' registered office address is Suite 101, 17220 Stony Plain Road
    Edmonton, AB Canada T5S 1K6. A copy of this press release may be obtained on Liquor Stores' SEDAR profile at www.sedar.com.

    ________________________
    1 Closing share price as at November 14, 2016, the day prior to PointNorth's announcement of its approximately 10% position in the Company.

    PointNorth Capital Inc.

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