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TORONTO, May 06, 2019 — Lineage Grow Company Ltd. (CSE:BUDD) (“Lineage” or the “Company”) issues this press release to update its shareholders and others with respect to its reverse take-over transaction (the “RTO”) with FLRish, Inc. (“FLRish”), and proposed concurrent financing of FLRish by way of private placement of a minimum of C$10 million of subscription receipts (the “Financing”), further to its management information circular dated April 9, 2019, and amended on April 30, 2019 (the “Circular”) for its special shareholder meeting scheduled to be held on May 16, 2019 (the “Meeting”). The Circular also includes a draft listing statement of Lineage with respect to the RTO (the “Listing Statement”).

The terms of the Financing have been revised from what was disclosed in the Circular and the Listing Statement in that the price for the subscription receipts will be reduced from C$7.75 to C$7.00, each subscription receipt will be converted into one FLRish share and one full warrant, instead of one half of one warrant and the warrant exercise price will be reduced from C$9.70 to C$8.75 (the “Financing Amendments”). The broker warrants to be issued in the Financing are also repriced to C$7.00. Other terms of the Financing and the RTO remain unchanged from the disclosure in the Circular and the Listing Statement.

As a result of the Financing Amendments, Lineage shareholders will be subject to increased dilution from the Financing. Lineage shareholders will receive approximately 3.4% of the shares (“Resulting Issuer Shares”) of the issuer resulting from the RTO (the “Resulting Issuer”), instead of approximately 3.5% of the Resulting Issuer Shares as previously disclosed in the Listing Statement.

Upon closing of the RTO, the Resulting Issuer will have the following capitalization after giving effect to the Financing Amendments:

Designation of Securities Subordinate Voting Shares
(Minimum Offering)
Subordinate Voting Shares
(Maximum Offering)
Subordinate Voting Shares
(Full Exercise of Over-
Allotment Option)
Non-Diluted Subordinate Voting Shares   4,569,626  12,350,271  16,457,690
Total Lineage Convertible Securities (including Lineage Special Shares)   3,047,223   3,047,223   3,047,223
Total FLRish Convertible Securities   45,472,645  49,885,547  50,657,806
Total Convertible Securities   48,519,868  52,932,770  53,705,029
Total Fully Diluted Capital   53,089,493  65,283,041  70,162,719

The following is a detailed pro-forma capitalization for the Resulting Issuer after giving effect to the Financing Amendments.

Source: Lineage Grow Company Ltd.

TORONTO, May 06, 2019 (GLOBE NEWSWIRE) — Lineage Grow Company Ltd. (CSE:BUDD) (“Lineage” or the “Company”) issues this press release to update its shareholders and others with respect to its reverse take-over transaction (the “RTO”) with FLRish, Inc. (“FLRish”), and proposed concurrent financing of FLRish by way of private placement of a minimum of C$10 million of subscription receipts (the “Financing”), further to its management information circular dated April 9, 2019, and amended on April 30, 2019 (the “Circular”) for its special shareholder meeting scheduled to be held on May 16, 2019 (the “Meeting”). The Circular also includes a draft listing statement of Lineage with respect to the RTO (the “Listing Statement”).

The terms of the Financing have been revised from what was disclosed in the Circular and the Listing Statement in that the price for the subscription receipts will be reduced from C$7.75 to C$7.00, each subscription receipt will be converted into one FLRish share and one full warrant, instead of one half of one warrant and the warrant exercise price will be reduced from C$9.70 to C$8.75 (the “Financing Amendments”). The broker warrants to be issued in the Financing are also repriced to C$7.00. Other terms of the Financing and the RTO remain unchanged from the disclosure in the Circular and the Listing Statement.

As a result of the Financing Amendments, Lineage shareholders will be subject to increased dilution from the Financing. Lineage shareholders will receive approximately 3.4% of the shares (“Resulting Issuer Shares”) of the issuer resulting from the RTO (the “Resulting Issuer”), instead of approximately 3.5% of the Resulting Issuer Shares as previously disclosed in the Listing Statement.

Upon closing of the RTO, the Resulting Issuer will have the following capitalization after giving effect to the Financing Amendments:

Designation of Securities Subordinate Voting Shares
(Minimum Offering)
Subordinate Voting Shares
(Maximum Offering)
Subordinate Voting Shares
(Full Exercise of Over-
Allotment Option)
Non-Diluted Subordinate Voting Shares   4,569,626  12,350,271  16,457,690
Total Lineage Convertible Securities (including Lineage Special Shares)   3,047,223   3,047,223   3,047,223
Total FLRish Convertible Securities   45,472,645  49,885,547  50,657,806
Total Convertible Securities   48,519,868  52,932,770  53,705,029
Total Fully Diluted Capital   53,089,493  65,283,041  70,162,719

The following is a detailed pro-forma capitalization for the Resulting Issuer after giving effect to the Financing Amendments.

Designation of Securities  Number of
Underlying
Subordinate
Voting
Shares
(Minimum
Offering)
 Number of
Underlying
Subordinate
Voting
Shares
(Maximum
Offering)
 Number of
Underlying
Subordinate
Voting Shares
(Full Exercise
of Over-
Allotment
Option)
Percentage
(Minimum
Offering)
Percentage
(Maximum
Offering)
Percentage
(Full
Exercise of
Over-
Allotment
Option)
Lineage Existing Shareholders   1,827,742   1,827,742   1,827,742 3.4 % 2.6 % 2.4 %
Conversion of Lineage Series A Special Shares   1,070,707   1,070,707   1,070,707 2.0 % 1.5 % 1.4 %
Advisory Fee for FMICA for Transaction 405,534   448,391   455,891 0.8 % 0.6 % 0.6 %
FLRish Existing Shareholders   –   –   – 0.0 % 0.0 % 0.0 %
FLRish Series B Convertible Debenture Holders   2,965,794   2,965,794   2,965,794 5.5 % 4.2 % 3.8 %
FLRish Concurrent Financing Purchasers   1,428,571  10,000,000  11,500,000 2.7 % 14.0 % 14.8 %
Airfield Stock Consideration   –   –   3,040,000 0.0 % 0.0 % 3.9 %
Non-Diluted Subordinate Voting Shares   7,698,349  16,312,635  20,860,135 14.4 % 22.8 % 26.9 %
Lineage Warrants 557,357   557,357   557,357 1.0 % 0.8 % 0.7 %
Lineage Convertible Debts   72,696   72,696   72,696 0.1 % 0.1 % 0.1 %
Lineage Options 134,232   134,232   134,232 0.3 % 0.2 % 0.2 %
Lineage Series B Special Shares 275,325   275,325   275,325 0.5 % 0.4 % 0.4 %
Lineage Series C Special Shares 336,508   336,508   336,508 0.6 % 0.5 % 0.4 %
Shares issuable to Vendors in Lineage’s LUX Acquisition 430,315   430,315   430,315 0.8 % 0.6 % 0.6 %
Shares issuable to finder for Lineage’s LUX Acquisition   20,046   20,046   20,046 0.0 % 0.0 % 0.0 %
Shares issuable to Vendors in Lineage’s Agris Farms Acquisition 606,958   606,958   606,958 1.1 % 0.8 % 0.8 %
Convertible Debt for assumption of Lineage’s Agris Farms Acquisition 251,087   251,087   251,087 0.5 % 0.4 % 0.3 %
Warrants issuable for Lineage’s Agris Farms Acquisition 221,920   221,920   221,920 0.4 % 0.3 % 0.3 %
FMICA M&A Fee for Legacy Pipeline Acquisitions 140,778   140,778   140,778 0.3 % 0.2 % 0.2 %
Total Lineage Convertible Securities   3,047,223   3,047,223   3,047,223 5.7 % 4.3 % 3.9 %
Series B Convertible Debenture Holders   4,593,581   4,593,581   4,593,581 8.6 % 6.4 % 5.9 %
FLRish Existing Shareholders Multiple Voting Shares (expressed in Subordinate Voting Share terms)   25,902,918  25,902,918  25,902,918 48.3 % 36.3 % 33.4 %
FLRish Options (expressed in Subordinate Voting Share terms)   6,556,378   6,556,378   6,556,378 12.2 % 9.2 % 8.5 %
Series B Warrants (expressed in Subordinate Voting Share terms)   3,989,124   3,989,124   3,989,124 7.4 % 5.6 % 5.1 %
Series B Broker & Compensation Warrants 311,544   311,544   311,544 0.6 % 0.4 % 0.4 %
Concurrent Financing Warrants   1,428,571  10,000,000  11,500,000 2.7 % 14.0 % 14.8 %
Concurrent Financing Broker Warrants 100,000   700,000   805,000 0.2 % 1.0 % 1.0 %
Total FLRish Convertible Securities   42,882,116  52,053,545  53,658,545 80.0 % 72.9 % 69.2 %
Total Convertible Securities   45,929,339  55,100,768  56,705,768 85.6 % 77.2 % 73.1 %
Total Fully Diluted Capital 53,627,688  71,413,403  77,565,903 100.0 % 100.0 % 100.0 %

On closing of the RTO, the Resulting Issuer will file a Listing Statement to include updated information including the closing of the RTO and Financing, as well as updated financial statements.

About Lineage Grow Company Ltd.

Lineage Grow Company Ltd. is a reporting issuer that is listed on the Canadian Securities Exchange (“CSE“). Lineage is currently focused on operating two retail licensed stores located in two prominent cities in Oregon (Portland and Eugene), and on assembling licensed operators with good growth potential and superior management, either through direct acquisition or through joint ventures, with an aim towards building a dominant vertically-integrated cannabis business that leverages best-in-class cultivation, brands, distribution, and retail assets. Lineage has entered into a purchase agreement with Agris Farms and a binding letter of intent to acquire LUX. In addition, Lineage and Harborside have entered into a binding letter agreement pursuant to which Lineage will acquiring all the issued and outstanding securities of Harborside in a reverse takeover transaction.

For updates on the Company’s activities and highlights of the Company’s press releases, investor deck and other media coverage, please visit Lineage’s web site (under construction) at www.lineagegrow.com.

For further information, please contact:

Peter Bilodeau, Director & CEO
Lineage Grow Company Ltd.
Phone: (519) 919-6500
Email: pbilodeau@lineagegrow.com

The CSE (operated by CNSX Markets Inc.) has in no way passed upon the merits of the Business Combination and has neither approved nor disapproved of the contents of this press release.

Disclaimer for ForwardLooking Information

This news release contains forward-looking statements and information based on current expectations. Generally, forward looking information can be identified by the use of forward looking terminology such as “plans”, “expects”, “scheduled”, “estimates”, “forecasts”, “intends”, “anticipates” or “believes”, or variations of such words and phrases or state that certain actions, events or results “may”, “could”, “would”, “might”, or “will be taken”, “occur”, or “be achieved”. Forward looking information in this press release includes the information concerning the RTO, the expected terms for the Financing, the expected resulting issuer capitalization, expectations regarding the listing of the shares of the Resulting Issuer on the CSE; management’s plan to develop dominant brand of premium quality craft cannabis; and management’s intention to successfully produce craft cannabis at an commercially viable industrial scale. These statements should not be read as guarantees of future performance or results. Such statements involve known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements to be materially different from those implied by such statements. There is no certainty that any of these events will occur. Although such statements are based on management’s reasonable assumptions, there can be no assurance that such assumptions will prove to be correct. Additionally, there are known and unknown risk factors which could cause the Company’s actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking information contained herein. All forward-looking information herein is qualified in its entirety by this cautionary statement, and the Company disclaims any obligation to revise or update any such forward-looking information or to publicly announce the result of any revisions to any of the forward-looking information contained herein to reflect future results, events or developments, except as required by applicable securities laws.

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