Origin House Subsidiary Trichome Financial Corp. Announces $3.5 Million Senior Secured Term Loan Agreement with James E. Wagner Cultivation Corporation

 In News Release

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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 unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.

Toronto, Canada – February 20, 2019 – Trichome Financial Corp. (“Trichomeor the “Company”) is pleased to announce that it has entered into a $3.5 million term loan (the “Term Loan”) with James E. Wagner Cultivation Corporation (“JWC”), a Licensed Producer under the Cannabis Act and a premium cannabis brand, focused on producing clean and consistent strains of aeroponically-grown cannabis, distributed through their own medical channel and collaborative platforms, including Canopy Growth’s Spectrum medical brand. The Term Loan will assist JWC’s growth objective and will be used to purchase certain equipment and finance construction costs related to the rapid build-out and retrofit of JWC’s second facility (“JWC 2”) located at 530 Manitou Drive, Kitchener, Ontario.

“Trichome is pleased to be working with the team at JWC, which has a long and proud history as a successful family-run business.  They have already demonstrated the ability to grow world-class product through their proprietary GrowthSTORM™ aeroponic cultivation system,” said Kevin Jarrett, Vice President at Trichome Financial Corp. “With the increased capacity and process refinements built into their new state-of-the-art facility, we see JWC establishing themselves as a meaningful recreational and medical player. Trichome’s customized capital solution will finance specific equipment purchases and construction costs, ensuring JWC has additional liquidity and flexibility to meet its growth objectives.”

The Term Loan provides for $3.5 million to be drawn fully on closing and is secured by a first-ranking perfected security interest in the assets of JWC and is guaranteed by its subsidiaries. The Term Loan bears a fixed interest rate of 9.25% and matures in 24 months from the date of closing. It is proposed that JWC will issue bonus warrants (the “Bonus Warrants”) to Trichome to purchase 291,667 common shares of JWC at a price of $0.80 per share, being the trading price of the common shares of JWC at market close on the last trading day preceding this announcement. Issuance of the Bonus Warrants is subject to the approval of the TSX Venture Exchange. Closing of the Term Loan is subject to customary closing conditions. “This transaction has been structured with JWC’s requirements in mind, while providing structural risk mitigants and other economic attributes that provide Trichome shareholders with highly attractive returns consistent with our strategy and communications with investors to date” commented Michael Ruscetta, Chief Executive Officer of Trichome.  “The team at Trichome is currently working on a number of highly attractive transactions that are in advanced stages of our investment process, while originating new opportunities to add to our pipeline of more than 200 companies that we continue to monitor”.

About Trichome Financial Corp.

Trichome is a specialty finance company focused on providing flexible and creative capital solutions to the global legal cannabis market. Trichome was created to address the lack of credit availability in the large, growing and increasingly complex cannabis market. Founded by industry leaders Origin House, Stoic Advisory, and Sprott Inc. (TSX: SII), Trichome’s experienced management team has a unique edge to capitalize on proprietary deal flow and insight while developing a first mover advantage as a global cannabis focused specialty finance company. Trichome provides customized financing solutions across the industry value chain to support growth, capital expenditures, M&A, working capital and other needs.  Transactions are typically structured to earn attractive rates of contractual cash flows, retain optionality on value creation and ensure return of capital. Leveraging the combined resources and knowledge of its founders and management, it is able to offer significant value-added financial, product, market and operational support to its partner companies. Trichome’s current assets are all based in Canada and it has no operations or assets in the United States. For more information, please visit us at www.trichomefinancial.com or @trichomefinance on Twitter.

About James E. Wagner Cultivation Corporation

JWC’s wholly-owned subsidiary is a Licensed Producer under the Cannabis Regulations, formerly the Access to Cannabis for Medical Purposes Regulations (“ACMPR”). JWC is a premium cannabis brand, focusing on producing clean, consistent cannabis. JWC uses an advanced and proprietary aeroponic platform named GrowthStorm™. JWC was founded as a family company and is based on family values. JWC began as a collective of patients and growers under the Marihuana Medical Access Regulations (the precursor to ACMPR). Since its inception, JWC has remained focused on providing the best possible patient experience. JWC’s operations are based in Kitchener, Ontario. Learn more at www.jwc.ca

Further Information

For further information, please contact:

Michael Ruscetta, Chief Executive Officer, Trichome Financial Corp.

Telephone:       (416) 561-2541

Email:                mruscetta@trichomefinancial.com  

This news release contains “forward-looking information” and “forward-looking statements” (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 involves discussions with respect to 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. In this news release, forward-looking statements relate, among other things: the expected closing of the Term Loan; returns to Trichome with respect to the Term Loan; future transactions of Trichome, their stage of development and their terms; and the origination of new transactions for Trichome. Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable, are subject to 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: general business, economic, competitive, political and social uncertainties; and the delay or failure to receive board, shareholder or regulatory approvals. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on the forward-looking statements and information contained in this news release. Except as required by law, Trichome assumes no obligation to update the forward-looking statements of beliefs, opinions, projections, or other factors, should they change.