James E Wagner Cultivation Raises $18.5 Million Ahead of Going Public

James E. Wagner Cultivation Ltd. Closes Over-Subscribed Brokered Private Placement of Subscription Receipts

TORONTO, April 30, 2018 (GLOBE NEWSWIRE) — James E. Wagner Cultivation Ltd. (“JWC” or the “Corporation”) is pleased to announce that its previously announced subscription receipt private placement (the “Offering”) has closed. Pursuant to the Offering, the Corporation issued 16,078,447 subscription receipts (“Subscription Receipts”) at a price of C$1.15 per Subscription Receipt (the “Issue Price”) for aggregate gross proceeds of C$18,490,214.05.

Haywood Securities Inc. (“Haywood”) and Eight Capital (“Eight”) acted as co-lead agents for the Offering, together with and on behalf of a syndicate of agents including AltaCorp Capital Inc., INFOR Financial Inc., Beacon Securities Limited and Mackie Research Capital Corporation (together with Haywood and Eight, the “Agents”). The Offering was conducted pursuant to the terms of an agency agreement (the “Agency Agreement”) dated April 27, 2018 among the Corporation, AIM1 Ventures Inc. (“AIM1”) and the Agents.

The closing of this private placement is a transformational event for JWC and it fortifies the next stage of our company’s growth strategy.

Nathan Woodworth, Chief Executive Officer of JWC

As our industry approaches the dawn of legalized and regulated cannabis consumption in Canada, JWC is optimally positioned to expand our cultivation and processing infrastructure, deploy our proprietary GrowthStorm technology at scale, and bring standardized high-end cannabis products to market.

The Subscription Receipts were issued pursuant to a subscription receipt agreement (the “Subscription Receipt Agreement”) among the Corporation, Haywood, Eight and TSX Trust Company, as subscription receipt agent. Pursuant to the Subscription Receipt Agreement, the gross proceeds of the Offering less the costs and expenses of the Agents (including legal fees, disbursements and applicable taxes) (the “Escrowed Subscription Funds”), have been placed in escrow pending satisfaction of certain escrow release conditions (the “Escrow Release Conditions”). Upon the satisfaction of the Escrow Release Conditions on or prior to August 25, 2018 (the “Escrow Release Deadline”), each Subscription Receipt shall be automatically converted by the Corporation, without the payment of additional consideration, into one common share in the capital of the Corporation (a “Subscription Share”) and one half of one common share purchase warrant of the Corporation (each whole warrant, a “Subscription Warrant”). Each whole Subscription Warrant shall entitle the holder thereof to purchase one common share in the capital of the Corporation (each, a “Warrant Share”) at any time for a period of 24 months following the date of the completion of the Transaction (as defined below), at an exercise price of $1.50 per Warrant Share, subject to adjustment as provided in the warrant indenture (the “Warrant Indenture”) dated April 27, 2018 entered into among the Corporation, AIM1 and TSX Trust Company, as warrant agent.

The Subscription Receipts are being issued in connection with the previously-announced proposed going-public transaction (the “Transaction”) involving the Corporation and AIM1, which constitutes the “qualifying transaction” of AIM1 pursuant to the policies of the TSX Venture Exchange (the “TSXV”).

Following completion of the Transaction, each Subscription Share will automatically be exchanged for one common share in the capital of AIM1 (post-Transaction) (the “Resulting Issuer”), and each Subscription Warrant will be exchanged for one common share purchase warrant in the capital of the Resulting Issuer, pursuant to the terms of the Warrant Indenture.

In consideration of the services provided by the Agents in connection with the Offering, the Agents received 762,149 compensation options (the “Compensation Options”). In addition, the Agents are entitled to receive a cash commission equal to $876,473.36, to be paid out of the Escrowed Subscription Funds upon satisfaction of the Escrow Release Conditions prior to the Escrow Release Deadline. Provided the Escrow Release Conditions are satisfied, each Compensation Option will be exercisable to purchase one common share in the capital of JWC at the price of $1.15 per share and, following completion of the Transaction, assuming such Compensation Option was not previously exercised, each one Compensation Option will automatically be exchanged for one compensation option of the Resulting Issuer which shall be exercisable to purchase one common share in the capital of the Resulting Issuer (subject to any necessary adjustments, as applicable) at a price of $1.15 per share for a period of 24 months from the date the Escrow Release Conditions are satisfied, if satisfied prior to the Escrow Release Deadline.

All securities issued pursuant to the Offering are subject to a hold period ending on the later of: (a) August 28, 2018; or (b) the date that the Corporation becomes a reporting issuer pursuant to applicable securities laws.

About JWC

JWC is a premier cannabis business that focuses on growing its cannabis aeroponically, using cutting edge cannabis technologies and growing practices. Although many methods are used to produce cannabis under the Access to Cannabis for Medical Purposes Regulations (“ACMPR”), it is important to note that these methods will often result in a variety of different outcomes. Through its various proprietary technologies involved in all stages of the growing process, JWC prides itself on continuing to provide patients with clean, consistent medical cannabis products of high quality.

JWC has entered into a strategic partnership with Canopy Growth Corporation (“Canopy Growth”) and its strategic investment arm, Canopy Rivers Corporation. The strategic partnership provides JWC with access to high-quality genetics sourced from around the world, industrial scale cannabis oil infrastructure, and a rigorous Quality Assurance program. Through its strategic partnership, JWC is also a partner of CraftGrow, an online store that provides fast shipments of cannabis to customers. In addition, JWC has access to the Tweed Main Street online marketplace that provides JWC with direct exposure to Canopy Growth’s operational, distribution, marketing and sales infrastructure.

Original Press Release

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