/NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES./

TORONTO, Oct. 30, 2017 /CNW/ - The Hydropothecary Corporation ("THCX" or the "Company") (TSX VENTURE:THCX) announced today that it has entered into an agreement with Canaccord Genuity Corp. and a syndicate of underwriters (the "Underwriters") pursuant to which the Underwriters have agreed to purchase, on a bought deal placement basis, 50,000 convertible debenture units of the Company (the "Convertible Debenture Units") at a price of $1,000 per unit for aggregate gross proceeds of $50,000,000. Each Convertible Debenture Unit will consist of $1,000 principal amount of 7.0% senior unsecured convertible debentures of the Company (the "Convertible Debentures") and 227 common share purchase warrants (the "Warrants") of the Company (the "Offering").

The Company has also granted the Underwriters an option to purchase up to an additional 7,500 Convertible Debenture Units under the Offering at a price of $1,000 per unit (the "Over-Allotment Option"). If the Over-Allotment Option is exercised in full, the aggregate gross proceeds of the Offering will be $57,500,000. The Over-Allotment Option are exercisable at any time up to 30 days following the date of the closing of the Offering.

The Convertible Debentures will bear interest from the date of closing at 7.0% per annum, payable semiannually on June 30 and December 31 of each year and will mature three years from the date the Convertible Debenture Units are issued (the "Maturity Date"). The Convertible Debentures will be convertible at the option of the holder into common shares of the Company ("Common Shares") at any time prior to the close of business on the Maturity Date at a conversion price of $2.20 per share (the "Conversion Price"). The Company may force the conversion of all of the principal amount of the then outstanding Convertible Debentures at the Conversion Price on 30 days' written notice should the daily volume weighted average trading price of the Common Shares be greater than $3.15 for any 10 consecutive trading days.

At maturity, if the Company's market capitalization is equal to or greater than $100,000,000, the Company will have the right to pay up to 50% of the principal amount of the then outstanding Convertible Debentures due in Common Shares, which will be valued at the lower of: (i) the market price of the Common Shares on the maturity date, and (ii) 95% of their weighted average trading price on the principal exchange for trading of the Common Shares at the maturity date for the 20 consecutive trading days ending five trading days preceding the maturity date, and in each case only if such price is equal to or greater than $1.00 and will be subject to compliance with applicable policies of the principal exchange for trading of the Common Shares at that time.

Each Warrant will be exercisable to acquire one common share of the Company for a period of two years following the closing date of the Offering at an exercise price of $3.00 per share, subject to adjustment in certain events, and subject to the Company's right to accelerate expiry of the Warrants if the closing trading price of the common shares of the Company equals or exceeds $4.50 for any 10 consecutive trading days.

The Company intends to use the net proceeds of the Offering for working capital and general corporate purposes. Closing of the Offering is expected to occur on or about November 17, 2017.

The Convertible Debenture Units shall be offered and sold by way of a bought deal public offering in all provinces and territories of Canada qualified by short form prospectus and will not be offered or sold in the United States or to, or for the account of, United States persons except to qualified institutional investors (as defined in Rule 144A of the United States Securities Act of 1933).

The Company will file a short form prospectus qualifying the issuance of the Convertible Debenture Units in all the provinces of Canada, except Quebec, pursuant to National Instrument 44-101 – Short Form Prospectus Distributions. The Offering is expected to close on or about November 17, 2017 and is subject to certain conditions including, but not limited to, the receipt of all necessary regulatory and stock exchange approvals, including the approval of the TSX Venture Exchange.

About The Hydropothecary Corporation

The Hydropothecary Corporation is an authorized licensed producer and distributor of medical cannabis licensed by Health Canada under the Access to Cannabis for Medical Purposes Regulations (Canada). Hydropothecary provides sungrown and rigorously tested medical cannabis of uncompromising quality. Hydropothecary's branding, cannabis product offering, patient service standards and product pricing are consistent with Hydropothecary's positioning as a premium brand for a legal source for medical cannabis within this new marketplace. In addition to medical cannabis production and sales, Hydropothecary explores various research and development opportunities for cannabinoid extracts, drugs and combinatory chemistry. In addition, the company is investigating the development and patenting of novel technologies related to medical cannabis, as well as the import and export of medical cannabis.

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

SOURCE The Hydropothecary Corporation

For further information: For Investor Relations Inquiries: Jennifer Smith, Manager of Financial Reporting and Investor Relations, 1-866-438-THCX (8429), [email protected], www.THCX.com; For Media Inquiries: Julie Beun, Publicist and Media Relations, [email protected], 613-371-9060 or Adam Miron, Director, 819-639-5498

Related Links

www.thehydropothecary.com

