Itafos (TSXV:IFOS) entered into an arrangement agreement to acquire 64.83% stake in Stonegate Agricom Ltd. (TSX:ST) from Lloyd I. Miller, III and others for CAD 5.3 million on May 18, 2017. Under the terms, each shareholder of Stonegate Agricom will receive 0.008 of an ordinary share of Itafos for each Stonegate Agricom share held. Itafos will deliver into escrow with the depositary an irrevocable treasury direction with respect to the consideration shares to be issued to the Stonegate Agricom pursuant to the transaction. In the event of termination of the transaction, either party will pay a termination fees of CAD 0.4 million. The transaction contains customary non-solicitation provisions which are subject to Stonegate Agricom's right to consider and accept a superior proposal subject to a matching right in favor of Itafos. All members of Stonegate Agricom Board and Senior Management of Stonegate shall resign and, be replaced with such Board Members and Senior Management as may be designated by Itafos in its sole discretion.

The transaction is subject to the approval of the Ontario Superior Court of Justice, at least two-thirds of the votes cast by Stonegate Agricom shareholders, majority of the votes cast by disinterested Stonegate Agricom shareholders, receipt of all necessary regulatory approvals including TSXV conditional approval, the Articles of Arrangement to be filed with the Director under the OBCA in accordance with the arrangement shall be in a form and content satisfactory to Itafos, Stonegate Agricom dissent rights shall have not been exercised with respect to more than 10% of the issued and outstanding Stonegate Agricom shares, all severance payments, including severance payments in the aggregate amount of CAD 0.13 million to certain officers and employees of Stonegate Agricom, to be determined in Stonegate Agricom's sole discretion, shall have been satisfied among other conditions.

The Stonegate Agricom special committee unanimously recommended that the Board of Directors of Stonegate Agricom approve the transaction. After receiving the recommendation of Stonegate Agricom special committee and advice from its advisors, the disinterested members of Stonegate Agricom Board have unanimously determined that the transaction is in the best interests of Stonegate Agricom and is fair to Stonegate Agricom shareholders and will recommend that Stonegate Agricom shareholders vote in favor of the transaction.

The board of directors of Itafos unanimously determined that the transaction is in the best interests and has resolved to support the transaction. All of the Directors and Senior Officers of Stonegate Agricom, as well Lloyd I. Miller, III, have entered into customary support agreements with Itafos pursuant to vote their Stonegate Agricom shares in favor of the transaction. If the transaction is completed, the Stonegate Agricom shares will be delisted from the TSX. A special meeting of Stonegate Agricom shareholders is expected to be held in July, 2017. The transaction is expected to close by August 2017. As of July 13, Stonegate Shareholders approved the transaction. The Ontario Superior Court of Justice (Commercial List) issued a final order approving the Arrangement on July 17, 2017.

Echelon Wealth Partners Inc. acted as financial advisor and provided a fairness opinion to Stonegate Agricom. Jay King, Alexander Pizale, James Lyle, Robert Cohen and James Morand of Cassels Brock & Blackwell LLP acted as Canadian legal advisor and Neal, Gerber & Eisenberg LLP acted as US legal advisor to Stonegate Agricom. Cathy Singer of Norton Rose Fulbright Canada LLP acted as legal advisor to Itafos. TSX Trust Company acted as transfer agent for Stonegate . TSX Trust Company also acted as transfer agent, registrar and depositary for Itafos. PricewaterhouseCoopers LLP acted as auditor for Itafos.