Mr. Paul Andreola reports

IRONWOOD CAPITAL CORP. AND NANALYSIS CORP. ANNOUNCE PROPOSED QUALIFYING TRANSACTION

Ironwood Capital Corp. has entered into an amalgamation agreement dated June 20, 2018, with Nanalysis Corp. to acquire all of the outstanding common shares of Nanalysis by way of a three-corner amalgamation among Ironwood, Nanalysis and a wholly owned subsidiary of Ironwood (subco).

Information concerning Nanalysis

Nanalysis is a patent-protected technology company with a proven record in the development, manufacturing and sales of magnetic resonance spectrometers for the pharmaceutical, biotech, chemical, security, food and education industries. The company sells its instruments in over 40 countries around the world, and is raising money to fuel its global growth strategy via the expansion of its sales and marketing organizations.

Nanalysis is a private company incorporated on Jan. 9, 2009, under the laws of Alberta. Nanalysis currently has 80,254,717 Class A common shares issued and outstanding. In addition, Nanalysis has issued and outstanding stock options to purchase up to an aggregate of 6.86 million Nanalysis shares at exercise prices ranging between seven cents to 25 cents per share, restricted share units exercisable into 130,000 Nanalysis shares and a convertible loan in the aggregate principal amount of $412,500 (the principal amount plus a financing fee of $85,000 is convertible into 2,163,043 Nanalysis shares). Other than the Nanalysis shares, Nanalysis options, Nanalysis RSUs and the Nanalysis convertible loan, no other securities of Nanalysis are issued and outstanding.

Information concerning the transaction

Subject to the terms and conditions of, and in the manner as set out in, the amalgamation agreement, Ironwood and subco will amalgamate, pursuant to the provisions of the Business Corporations Act (Alberta) (ABCA), effective as of the date set forth in a certificate of amalgamation to be issued pursuant to the ABCA in respect of the transaction. Each Nanalysis share issued and outstanding before the effective date shall be cancelled and its holder shall receive one Ironwood common share for each four Nanalysis shares held. The common shares of subco issued and outstanding immediately before the effective date shall be replaced by common shares of the amalgamated company issued in favour of Ironwood. Upon amalgamation, Nanalysis will effectively be a wholly owned subsidiary of Ironwood. In accordance with the terms of the amalgamation agreement, holders of Nanalysis options and Nanalysis RSUs shall receive Ironwood options and Ironwood RSUs, respectively, in accordance with the exchange ratio (on the same terms and conditions as their respective Nanalysis options and Nanalysis RSUs). Upon completion of the transaction, and assuming completion of the concurrent financing (as defined herein), former holders of Nanalysis shares will hold approximately 74 per cent of the resulting issuer (as defined later in this news release) common shares and Ironwood holders will hold 26 per cent of the resulting issuer common shares.

The Nanalysis shares are widely held and, to the knowledge of the directors and executive officers of Nanalysis (as at the date hereof), no person or company beneficially owns, directly or indirectly, or exercises control or direction over voting securities of Nanalysis carrying 10 per cent or more of the voting rights attached to any class of voting securities of Nanalysis, other than Sean Krakiwsky (who owns 11,037,143 Nanalysis shares or 13.75 per cent of the issued and outstanding Nanalysis shares (assuming there are 80,254,717 Nanalysis shares issued and outstanding)). The remaining Nanalysis shares are held by approximately 150 shareholders.

The transaction is subject to TSX Venture Exchange approval and is intended to constitute Ironwood's qualifying transaction in accordance with TSX-V Policy 2.4 -- Capital Pool Companies. On closing of the transaction, Ironwood will change its name to Nanalysis Group Inc., or such other similar name as the parties may agree to, and Ironwood's common shares will be listed under a new trading symbol. The resulting issuer anticipates being classified as a Tier 1 issuer that will meet the initial listing requirements for a technology company.

The transaction will not constitute a non-arm's-length transaction (as such term is defined in the policies of the TSX-V). No insider, promoter or control person (as such terms are defined in the policies of the TSX-V) of Ironwood has any material interest in Nanalysis prior to giving effect to the transaction.

The Ironwood securities issuable under the transaction will be subject to the escrow requirements of the TSX-V and hold periods as required by applicable securities laws.

The transaction is not subject to approval by the shareholders of Ironwood. However, the transaction must be approved by no less than two-thirds of the votes cast at a meeting of Nanalysis shareholders. The meeting will be held as soon as practicable to consider and approve the transaction.

Concurrent financing

Prior to, or concurrently with, the closing of the transaction, Ironwood intends to complete a non-brokered private placement of at least 3.6 million Ironwood shares at a price of $1 per share for gross proceeds of $3.6-million (or such other amount that is mutually agreed to by the parties). It is a condition to closing of the transaction that Ironwood completes the concurrent financing for gross proceeds of at least $3.6-million. The proceeds of the concurrent financing will be used for the selling, general and administrative expenses associated with the global expansion of Nanalysis's sales organization and distribution network.

Management and board of directors of resulting issuer

Upon completion of the transaction, it is expected that the board of directors and management of the resulting issuer will consist of the persons identified herein.

Mr. Krakiwsky, president, chief executive officer and director

Nanalysis is Mr. Krakiwsky's third technology start-up over a 20-year career, raising over $30-million in equity financing for those companies. Previously, he founded and built a high-performance computing company called Acceleware, providing software solutions to harness the parallel processing capabilities of multicore GPUs/CPUs for the electronic design industry as well as the oil and gas industry. Mr. Krakiwsky has an MSc and a BSc in electrical engineering from the University of Calgary.

Gary Reavie, CPA, MBA, chief financial officer

Mr. Reavie has extensive accounting, finance and information systems implementation experience spanning a 28-year career, including as managing finance and administration partner with WaterSMART Solutions, manager of finance and information technology with The Association of Professional Engineers and Geoscientists of Alberta, and vice-president of finance and administration with Canspec Group Inc. He received a diploma in business education, accounting and finance from the Southern Alberta Institute of Technology, a bachelor's degree from the University of Manitoba, and an MBA from Athabasca University.

Dr. Garrett Leskowitz, chief science officer

Dr. Leskowitz has been researching compact NMR technology as well as novel NMR and FTIR instrumentation and methods for over 20 years. He received an SB at MIT (Massachusetts Institute of Technology) and a PhD in chemistry from the California Institute of Technology (Caltech). He has four patents, and is the author of numerous research publications and presentations at scientific conferences. He has held teaching and/or research appointments at MIT, Harvard University, Caltech, the University of California at Riverside and the Claremont Colleges.

Dr. Mohamed Abousalem, director

Dr. Abousalem has a PhD in engineering from the University of Calgary and an MBA from Santa Clara University in the Silicon Valley. He is currently assistant vice-chancellor of industry alliances and technology commercialization at University of California Santa Cruz (Silicon Valley), and is the former chief executive officer of Tecterra Inc. in Calgary. He has 25 years of engineering, marketing, mergers and acquisitions, and operations management experience in both small and large technology companies in Canada as well as in the United States.

Steve Meszaros, director

Mr. Meszaros sold his interest in Avonlea Homes Ltd., the largest residential home builder in Alberta (south of Calgary), three years ago, but is still involved in land development. His career spanned 35 years in various facets of real estate, property management, construction and land development. He holds a degree in business administration from Oregon State University, an honorary bachelor of applied science degree and is a distinguished alumnus (2012) from Lethbridge College. Mr. Meszaros supports foreign students to attend Lethbridge College through a major grant program established in his name in 2012.

Werner Gartner, director

Mr. Gartner has over 25 years executive/board experience with technology-based businesses, primarily with companies in the GPS (global positioning system)/GNSS (global navigation satellite system) and wireless sectors. Mr. Gartner has served on the board of directors and/or advised several technology companies, including Hemisphere GNSS Inc., 4iiii Innovation Inc., RoboGarden Inc., Beijing UniStrong Science and Technology Co., Trusted Positioning Inc., and Profound Positioning Inc. He is also a member of the board of directors of Tecterra, an Alberta government-funded organization mandated to spur the development and commercialization of geospatial technologies. In addition, Mr. Gartner is a member of the A100, an organization composed of technology company founders and entrepreneurs focused on growing the Alberta technology sector. He is also a member of the Institute of Corporate Directors in Canada. Mr. Gartner received a BSc from Western University in Ontario, an MBA from the Schulich School of Business at York University in Toronto and is a CPA/CMA.

Dr. Michal Okoniewski, director

Dr. Okoniewski is a director and chief scientific officer of Acceleware. A renowned expert in applied electrodynamics and RF/antenna engineering, Dr. Okoniewski has a proven history of developing leading-edge scientific solutions for the electronic, medical and energy industries. With over 25 years of experience, Dr. Okoniewski has pioneered hardware acceleration of computational electromagnetics, authoring over 350 technical publications and holding several patents. His GPU accelerated FDTD solver revolutionized the engineering of electronic devices. More recently, his patents and knowledge are being applied in the energy industry for the production of heavy oils in unconventional reservoirs. Prior to co-founding Acceleware in 2004, Dr. Okoniewski worked with TR-Labs, and provided consulting services for the electronic and biomedical industries in North America and Europe. Dr. Okoniewski has a PhD in electrical engineering from the Technical University, Gdansk, and is a fellow of IEEE (Institute of Electrical and Electronics Engineers). He is a professor for the electrical and computer engineering department with the Schulich School of Engineering at the University of Calgary (Canada).

Nanalysis financial information

The attached table sets out, in summary form, selected unaudited financial information about Nanalysis for the financial years ended Dec. 31, 2017, and Dec. 31, 2016. Additional audited financial information for Nanalysis will be provided in the filing statement of Ironwood (to be prepared in connection with the transaction).

 
                                                   For the year ended   For the year ended
                                                        Dec. 31, 2017        Dec. 31, 2016 
 
Revenue                                                    $7,674,854           $4,382,843
Cost of products sold                                       2,720,746            1,777,822
Gross margin                                                4,954,108            2,605,021
Sales, general and administrative expenses                  3,237,957            2,913,417
Other income (loss)                                          (223,539)             (93,568)
Net income (loss)                                           1,492,612             (401,964)

Conditions to the transaction

The completion of the transaction is subject to the approval of the TSX-V and all other necessary regulatory approvals. It is also subject to additional conditions precedent, including:

• Company name change to Nanalysis Group (or such other similar name as the parties may agree to);
• Approvals from the Ironwood board of directors and Nanalysis board of directors;
• Completion of the concurrent financing by Ironwood for gross proceeds of at least $3.6-million;
• Preparation and filing of a filing statement outlining the definitive terms of the transaction in accordance with the policies of the TSX-V;
• Receipt of all director, shareholder and requisite regulatory approvals relating to the transaction, including, without limitation, the approval of the TSX-V;
• Each of Ironwood and Nanalysis shall have executed, delivered and performed all covenants (on each of their respective parts) to be performed under the amalgamation agreement, and all representations and warranties of each party contained in the amalgamation agreement shall be true and correct in all material respects at the effective date;
• There shall be no material adverse change in respect of either Ironwood or Nanalysis prior to closing the transaction.

Sponsor

The proposed transaction is subject to the sponsorship requirements of the TSX-V. The parties intend to apply for a waiver of the sponsorship requirements of the TSX-V. There is no guarantee that an exemption will be granted by the TSX-V.

Filing statement and caution

Further details about the transaction and the resulting issuer will be provided in the filing statement of Ironwood (to be prepared and filed in respect of the transaction). Investors are cautioned that, except as disclosed in the filing statement, any information released or received with respect to the transaction may not be accurate or complete and should not be relied upon. Trading in the securities of a capital pool company should be considered highly speculative.

Trading of Ironwood shares

Trading of Ironwood shares will be halted as a result of this announcement. Trading of Ironwood shares will remain halted pending the review of the proposed transaction by the TSX-V. There can be no assurance that trading of Ironwood shares will resume prior to the completion of the transaction.

We seek Safe Harbor.