Deveron Announces Closing of Private Placement of Convertible Debentures

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Toronto, Ontario--(Newsfile Corp. - May 18, 2022) - Deveron Corp. (TSXV: FARM) ("Deveron" or the "Company"), a leading agriculture data company in North America, is pleased to announce that it has closed its previously announced non-brokered private placement (the "Private Placement") of 7.0% unsecured convertible debentures (each, a "Debenture") for aggregate gross proceeds of $10 million.

The Private Placement was completed in connection with Deveron's previously-announced acquisition of a 67% equity interest (the "Acquisition") in A&L Canada Laboratories East, Inc. ("A&L"), a leading Canadian soil health and plant tissue testing laboratory. For additional information regarding the Acquisition and the terms of the Private Placement, please refer to Deveron's news releases dated May 2, 2022 and May 10, 2022.

Deveron expects to finance the cash component of the purchase price of the Acquisition through: (i) a $28 million credit facility provided by Toronto-Dominion Bank; (ii) the Private Placement; and (iii) the Company's treasury cash.

The issuance of the Debentures pursuant to the Private Placement were (and, if applicable, the underlying common shares of the Company ("Common Shares") shall be) completed on a private placement and prospectus exempt basis, as applicable, such that the issuances are (or in the case of any underlying Common Shares, shall be) exempt from any applicable prospectus and securities registration requirements. In connection with the Private Placement, certain arm's-length finders received an aggregate of $470,200 in cash finder's fee commissions and an aggregate of 818,012 finder's warrants (the "Finder's Warrants"), with each Finder's Warrant being exercisable to acquire a Common Share at an exercise price of $0.50 for a period of 24 months after the closing date of the Private Placement. Pursuant to applicable Canadian securities laws, the Debentures and the Finder's Warrants, as well as any underlying Common Shares to be issued upon conversion or exchange of these securities, are subject to a hold period of four months and one day, expiring on September 19, 2022. The Private Placement remains subject to the final approval of the Exchange.

About A&L

A&L is one of the largest soil and tissue laboratories in Canada. Founded by Greg Patterson, and based in London, Ontario, A&L operates a 54,500 square foot laboratory with significant growth capacity and 106 employees, including a large R&D group that has produced patented, crop specific yield and disease solutions. A&L processes over 435,000 soil samples per year. Deveron and A&L have cooperated in Canadian soil testing and analysis since 2019 and jointly own and operate Wood's End Laboratory in the United States. During the 12 month period ended December 31, 2021, A&L had unaudited revenue of $26.7 million and EBITDA of $11.6 million.1 As at December 31, 2021, A&L had total unaudited assets of $19,835,475 and total unaudited liabilities of $6,747,983.

About Deveron

Deveron is an agriculture technology company that uses data and insights to help farmers and large agriculture enterprises increase yields, reduce costs and improve farm outcomes. The company employs a digital process that leverages data collected on farms across North America to drive unbiased interpretation of production decisions, ultimately recommending how to optimize input use. Our team of agronomists and data scientists build products that recommend ways to better manage fertilizer, seed, fungicide, and other farm inputs. Additionally, we have a national network of data technicians that are deployed to collect various types of farm data, from soil to drone, that build a basis of our best-in-class data layers. Our focus is the US and Canada where 1 billion acres of farmland are actively farmed annually.2

For more information and to join our community, please visit www.deveron.com.

David MacMillan
President & CEO, Deveron Corp.
dmacmillan@deveron.com
416-367-4571 ext. 221

A&L Financial Statements and Information

All A&L financial statements have been prepared in accordance with Canadian GAAP principles applicable to private enterprises, which are Canadian accounting standards for private enterprises in Part II of the Chartered Professional Accountants of Canada Handbook. The recognition, measurement and disclosure requirements of Canadian GAAP applicable to private enterprises differ from those of Canadian GAAP applicable to publicly accountable enterprises, which are IFRS.

A&L's EBITDA, as used herein, is defined by A&L as net earnings (as per Canadian accounting standards for private enterprises set out in Part II of the CPA Canada Handbook - Accounting, as issued by the Accounting Standards Board in Canada) less interest expense, depreciation and amortization, and income taxes.

Presentation of Financial Information

The financial information of Deveron referred to in this news release is reported in Canadian dollars and have been prepared in accordance with IFRS. All financial information of A&L referred to in this news release is reported in Canadian dollars and has been derived from audited and unaudited historical financial statements of A&L that were prepared in accordance with Canadian accounting standards for private enterprises. The recognition, measurement and disclosure requirements of Canadian GAAP applicable to private enterprises differ from those of Canadian GAAP applicable to publicly accountable enterprises, which are IFRS.

The financial information for A&L in this news release for the 12 months ended December 31, 2021 are unaudited and were calculated by management by adding figures for six months ended December 31, 2021 (unaudited) to figures for year ended June 30, 2021 (audited) and subtracting figures for six months ended December 31, 2020 (unaudited).

Forward-Looking Statements

This news release includes certain "forward-looking statements" within the meaning of that phrase under Canadian securities laws. Without limitation, statements regarding future plans and objectives of the Company are forward-looking statements that involve various degrees of risk. Forward-looking statements reflect management's current views with respect to possible future events and conditions and, by their nature, are based on management's beliefs and assumptions and subject to known and unknown risks and uncertainties, both general and specific to the Company. This forward-looking information in this news release includes, among other things, statements relating to: the use of net proceeds of the Private Placement; final approval of the Exchange; the closing and timing of the Acquisition on the announced terms, including the satisfaction and timing of the receipt of all required regulatory approvals, including the approval of the Exchange; the ability to finance the Acquisition and the anticipated sources of financing of the Acquisition; the completion of the loan from Toronto-Dominion Bank; the Company's ability to execute its growth plans and achieve its goals; the continued demand for soil data; and the effect of Acquisition on the Company. Although the Company believes the expectations expressed in such forward-looking statements are reasonable, such statements are not guarantees of future performance and actual results or developments may differ materially from those in our forward-looking statements. The following are important factors that could cause the Company's actual results to differ materially from those expressed or implied by such forward-looking statements: changes in the worldwide price of agricultural commodities, general market conditions, risks inherent in agriculture, the uncertainty of future profitability and the uncertainty of access to additional capital. Additional information regarding the material factors and assumptions that were applied in making these forward-looking statements as well as the various risks and uncertainties we face are described in greater detail in the "Risk Factors" section of our annual and interim Management's Discussion and Analysis of our financial results and the "Risk Factors" section of the Company's short form base shelf prospectus dated November 30, 2021 and other continuous disclosure documents and financial statements filed by the Company with the Canadian securities regulatory authorities which are available at www.sedar.com. The Company undertakes no obligation to update this forward-looking information except as required by applicable law. All of the forward-looking information contained in this news release is expressly qualified by the foregoing cautionary statements. The Company relies on litigation protection for forward-looking statements.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

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 U.S. Securities Act, as amended, 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.

THIS NEWS RELEASE IS INTENDED FOR DISTRIBUTION IN CANADA ONLY AND IS NOT AUTHORIZED FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES

1 A&L figures for 12 months ended December 31, 2021 calculated by management by adding figures for six months ended December 31, 2021 (unaudited) to figures for year ended June 30, 2021 (audited) and subtracting figures for six months ended December 31, 2020 (unaudited).
2 Based on data collected through the United States Department of Agriculture, the National Agricultural Statistics Service and Statistics Canada.

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/124589