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GrowForce Announces Closing of C$38 Million Capital Raise

August 7, 2018

TORONTO--(BUSINESS WIRE)--Aug 7, 2018--GrowForce Holdings Inc. (“GrowForce” or the “Company”), a vertically integrated international cannabis platform, has successfully closed its previously announced equity capital raise (the “Offering” ) resulting in aggregate gross proceeds of more than C$38 million.

Pursuant to the Offering, GrowForce issued 7,832,716 brokered subscription receipts exchangeable for common shares at a price of C$3.20 amounting to C$25,064,700. GrowForce also issued 4,115,521 non-brokered subscription receipts at the same price for gross proceeds of approximately C$13,169,700. The result is a cumulative raise of more than C$38 million.

Cormark Securities Inc. and Canaccord Genuity Corp., acted as co-lead agent, together with a syndicate of agents, including Haywood Securities Inc., KES 7 Capital Inc. and Mackie Research Capital Corporation, for the offering.

GrowForce will use the secured funding for capital expenditure related to cultivation expansion, including strategic acquisitions of high quality cannabis assets, and general working capital to execute the Company’s growth strategy.

The Offering was completed in connection with GrowForce’s previously announced proposed reverse take-over (the “Transaction” ) of Platform Eight Capital Corp. (“ Platform Eight ”). The Transaction is expected to be completed during the third quarter of 2018. Pursuant to the Transaction, each common share of Platform Eight will be consolidated on the basis of approximately 12.23 common shares for each one (1) resulting issuer share and each common share of GrowForce will be exchanged for one (1) resulting issuer share and each convertible security of GrowForce will be exchanged for a comparable convertible security of the resulting issuer.

GrowForce was created and spun-off by Denver, Colorado based MJardin, a highly-experienced cannabis management company, with a mission to become one of the premier vertically-integrated cannabis platforms globally outside of the U.S. GrowForce recently announced that it has entered into an exclusive cultivation, extraction and retail licensing agreement with MJardin, including exclusive rights to its cannabis management services and intellectual property portfolio in Canada and international markets.

“With this capital raise, additional access to growth capital and key strategic partnerships in place, GrowForce is well-positioned to consolidate a fragmented cannabis industry in Canada and international markets,” said James Lowe, EVP of Operations for GrowForce. “Our growth strategy is focused on leveraging our significant experience successfully operating cultivation facilities across North America for more than nine years to position GrowForce as the leading consolidation platform in the legal cannabis industry.”

GrowForce possesses an existing Canadian footprint of cannabis assets with planned cumulative capacity of approximately 60,000 kg of cannabis production per annum. Core to its growth strategy, GrowForce also plans to establish partnerships with various First Nations to build new facilities for large-scale cannabis cultivation, extraction, and retail. These partnerships will allow Indigenous Peoples of Canada to capitalize on economic opportunities in the cannabis space through the cultivation, distribution and retail sale of cannabis products.

Through its strategic partnership with Bridging Finance and the establishment of the Bridging Infrastructure Fund, GrowForce has exclusive access to non-dilutive growth capital for continued infrastructure investments and consolidation of strong operational cannabis assets. Bridging Finance has committed more than C$80 million to GrowForce projects thus far with an additional C$60 million of projects in the pipeline.

“There are currently more than 100 licensed producers across Canada, with the majority moving from construction of facilities to operations. Few of these licensed producers have the operating expertise to successfully execute this transition,” said Lowe. “GrowForce has significant access to capital with the operational expertise to be one of the top licensed producers as we execute our M&A consolidation strategy and unique retail distribution model.”

About GrowForce

GrowForce is a Canadian-based cannabis platform that operates within Health Canada’s Access to Cannabis for Medical Purposes Regulations (“ACMPR”). GrowForce owns a majority interest in flagship cannabis facilities operated through Health Canada’s ACMPR, with strategic partnerships for turnkey operations, proprietary software and training, and project financing. GrowForce’s flagship facilities are intended to be operated by MJardin Group, North America’s largest turnkey operator of legal cannabis facilities, and financed by Bridging Finance Inc., Canada’s leading provider of private credit. For more information, please visit www.growforce.ca.

Not for distribution to United States newswire services or for dissemination in the United States. This news release does not constitute an offer to sell or a solicitation of an offer to buy any of the securities in the United States. The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the “U.S. Securities Act”) or any state securities laws and may not be offered or sold within the United States or to U.S. Persons unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.

Completion of the Transaction is subject to a number of conditions, including but not limited to, TSXV acceptance and if applicable pursuant to TSXV requirements, majority of the minority shareholder approval. If applicable, the Transaction cannot close until the required shareholder approval is obtained. There can be no assurance that the Transaction will be completed as proposed or at all.

Investors are cautioned that, except as disclosed in the management information circular or filing statement to be prepared in connection with the Transaction, any information released or received with respect to the Transaction may not be accurate or complete and should not be relied upon.

The TSXV has in no way passed upon the merits of the proposed Transaction and has neither approved nor disapproved the contents of this press release. Neither the TSXV nor its Regulation Services Provider (as that term is defined in the policies of the TSXV) accepts responsibility for the adequacy or accuracy of this release.

This press release contains statements that constitute “forward-looking information” (collectively, “ forward-looking statements ”) within the meaning of the applicable Canadian securities legislation. All statements, other than statements of historical fact, are forward-looking statements and are based on expectations, estimates and projections as at the date of this news release. Any statement that discusses predictions, expectations, beliefs, plans, projections, objectives, assumptions, future events or performance (often but not always using phrases such as “expects”, or “does not expect”, “is expected”, “anticipates” or “does not anticipate”, “plans”, “budget”, “scheduled”, “forecasts”, “estimates”, “believes” or “intends” or variations of such words and phrases or stating that certain actions, events or results “may” or “could”, “would”, “might” or “will” be taken to occur or be achieved) are not statements of historical fact and may be forward-looking statements. Forward-looking statements contained in this press release include, without limitation, statements regarding: the terms, conditions, and completion of the Transaction; use of funds; conversion of the subscription receipts; and the business and operations of the resulting issuer. In making the forward-looking statements contained in this press release, the Company has made certain assumptions, including, among others, that: due diligence will be satisfactory; that applicable escrow release conditions will be satisfied; and that all applicable shareholder, and regulatory approvals for the Transaction will be obtained or received. Although the Company believes that the expectations reflected in forward-looking statements are reasonable, it can give no assurance that the expectations of any forward-looking statements will prove to be correct. Known and unknown risks, uncertainties, and other factors which may cause the actual results and future events to differ materially from those expressed or implied by such forward-looking statements. Such factors include, but are not limited to: results of due diligence; availability of financing; delay or failure to receive board, shareholder or regulatory approvals; and general business, economic, competitive, political and social uncertainties. Accordingly, readers should not place undue reliance on the forward-looking statements and information contained in this press release. Except as required by law, the Company disclaims any intention and assumes no obligation to update or revise any forward-looking statements to reflect actual results, whether as a result of new information, future events, changes in assumptions, changes in factors affecting such forward-looking statements or otherwise.

View source version on businesswire.com:https://www.businesswire.com/news/home/20180807005116/en/

CONTACT: Media:

ICR

Cory Ziskind, 646-277-1232

cory.ziskind@icrinc.com

or

Investors:

Ali Mahdavi, 416-962-3300

Capital Markets & Investor Relations

Ali@growforce.ca

KEYWORD: NORTH AMERICA CANADA

INDUSTRY KEYWORD: HEALTH OTHER HEALTH NATURAL RESOURCES AGRICULTURE PROFESSIONAL SERVICES FINANCE

SOURCE: GrowForce Holdings Inc.

Copyright Business Wire 2018.

PUB: 08/07/2018 08:00 AM/DISC: 08/07/2018 08:01 AM

http://www.businesswire.com/news/home/20180807005116/en

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