Combined, the two companies establish a preeminent position in automated steering and machine control technologies worldwide, combining product portfolios and leveraging industry-leading intellectual property.

Specifically, Novariant and AgJunction will be better positioned to achieve market objectives through leveraging:

• A larger presence with more resources

• A broader OEM partner list

• One of the precision agriculture industry’s most comprehensive intellectual property
  portfolios, providing increased IP protection for OEM partners

• Increased R&D capability and efficiency

• Complementary customers, market geographies and distribution channels

• Reductions in operating redundancy to further improve profitability

Novariant is a premier provider of advanced steering solutions for precision agriculture. Based in Silicon Valley, Novariant’s steering solutions are used today in over 60 countries. With approximately 55 employees worldwide, Novariant generated revenues of approximately $30 million in 2014.

Completion of the transaction is expected during the summer of 2015 and is subject to a number of conditions, including receipt of a permit from the California Commissioner of Corporations following a hearing held to consider the terms of the transaction, approval of the shareholders of Novariant, approval of the shareholders of AgJunction at a Special Shareholders Meeting to be held in the summer of 2015 (the “Meeting”) and receipt of customary regulatory approvals, including the approval of the Toronto Stock Exchange.

Under the terms of the Agreement, which has been unanimously approved by the boards of directors of both companies, AgJunction shares will be issued to shareholders of Novariant in exchange for all of the shares of Novariant. After giving effect to the issuance of such AgJunction shares, AgJunction will have approximately 123.7 million fully diluted shares outstanding, of which approximately 49.5 million shares will be held by the former shareholders of Novariant, representing approximately 40% of the combined company.

Upon conclusion of the transaction, it is anticipated that directors, officers, and other insiders will hold approximately 30.6% of the combined company. This includes Novariant’s largest shareholder, Investor Growth Capital (“IGC”), an independent venture capital firm specializing in expansion-stage investments. IGC will become the largest shareholder of the combined company at approximately 15% ownership.

Strategic Rationale
This transaction will create a leading technology and innovation company, differentiated by its broad intellectual property portfolio and its ability to deliver application-specific solutions to precision agriculture customers globally.

“Novariant established itself as a pioneer in guidance and auto-steer technologies over 20 years ago”’ said Dave Vaughn, CEO of Novariant. “Most recently, Novariant has sharpened its focus on precision agriculture and has positioned its offerings to address a major shift in our industry from after-market channels to factory-installed solutions.

“A shift like this occurs only once during the life cycle of a technology, and great companies can be created by accelerating and innovating at the right time,” added Vaughn. “At Novariant we believe this is a transformational opportunity, and AgJunction is the right partner.”

As global machine manufacturers increasingly target the integration of auto steer technologies at the factory level, the combined companies can bring advanced levels of machine automation to both current and future OEM clients faster and at lower cost.