(TheNewswire)
Calgary, Canada – TheNewswire - November23, 2021 – DeepMarkit Corp. , (" DeepMarkit " or the" Company ") ( TSXV:MKT ) ( OTC:MKTDF ) ispleased to announce that it has enteredinto a non-binding letter of intent (the "LOI") to acquireall of the issued and outstanding shares of First Carbon Corp.("FCC"). The LOI sets forth the general terms andconditions of the Acquisition, pursuant to which shareholders of FCCwill receive an aggregate of approximately 15,000,000 common shares ofDeepMarkit ("Common Shares") issued at a deemed price of$0.50 per Common Share, for deemed consideration of approximately$7,500,000 (the "Acquisition").
DeepMarkit also announces a non-brokered privateplacement (the "Private Placement"). Under the PrivatePlacement, which is subject to acceptance by the TSX Venture Exchange(the "Exchange"), DeepMarkit intends to issue, pursuant toapplicable exemptions from prospectus requirements of Canadiansecurities laws, up to 4,000,000 units ("Units") at a priceof $0.50 per Unit, for gross proceeds of up to $2,000,000. Each Unitcomprises one Common Share and one Common Share purchase warrant(each, a "Warrant"). Each Warrant will entitle the holderto purchase one additional Common Share of DeepMarkit at an exerciseprice of $1.25 for a period of three (3) years from the date of theissuance of the Units.
DeepMarkit may pay a finder's fee of up to 7% cash and7% compensation warrants to eligible finders in connection with theissue and sale of any or all of the Units under the Private Placement. The net proceeds from the Private Placement will be used to fundcontinued business and corporate operations of DeepMarkit (for whichit is estimated that approximately 40% of the net proceeds will beallocated), as well as the operations of FCC (for which it isestimated that approximated 60% of the net proceeds will beallocated). Insiders of the Company may participate for up to 25% ofthe total offering. The Common Shares and Warrants issued pursuantto the Private Placement will be subject to a four month hold periodrequired under applicable securities laws. Closing of the Private Placement is not a condition tocompletion of the Acquisition.
Overview of FCC
FCC is a software infrastructure company operating inthe tokenization vertical of blockchain. FCC's primary asset,MintCarbon.io, is an SaaS, web-based platform which facilitates theminting of carbon credits into re-saleable tokens. MintCarbon.io iscurrently undergoing beta testing and FCC anticipates an officiallaunch in Q1 2022. FCC is a private company incorporated under thelaws of Canada. FCC currently has 39,474,999 common shares issued andoutstanding.
Acquisition Details
The LOI serves as an agreement in principle concerningthe Acquisition, which is expected to be completed pursuant to theterms of a share purchase agreement or share exchange agreemententered into among DeepMarkit, FCC and each shareholder of FCC. Thefinal structure of the Acquisition is subject to receipt by allparties of tax, corporate and securities law advice and will be agreedto and superseded by a definitive agreement (the "DefinitiveAgreement"). Other terms of the Acquisition include the rightof FCC to appoint a director (the "FCC Director Nominee")upon closing, and the agreement by DeepMarkit to use its best effortsto adopt a long-term equity incentive compensation plan, subject toapproval of the Exchange and DeepMarkit's disinterestedshareholders.
The completion of the Acquisition is also subject toseveral other conditions set out in the LOI, including approval by thedirectors of DeepMarkit and FCC, satisfactory completion of duediligence, the execution of the Definitive Agreement by all parties,including the FCC shareholders, and regulatory approval. A morecomprehensive news release will be issued by DeepMarkit disclosingdetails of the Acquisition, including information about the FCCDirector Nominee, and other information relevant to theAcquisition.
DeepMarkit views the business of FCC as highlysynergetic. The MintCarbon.io platform is a powerful tool whichenables businesses to monetize and manage carbon credits to achievevarious business objectives. DeepMarkit expects to leverage itsextensive investment in its existing platform and intellectualproperty for the benefit of FCC's business. The Acquisition will giveDeepMarkit the opportunity to expand its business of providingsoftware tools into a unique new and quickly expanding market.
The Acquisition is expected to constitute a"Fundamental Acquisition" transaction pursuant to ExchangePolicy 5.3 Acquisitions andDispositions of Non-Cash Assets and will besubject to Exchange review in accordance with that policy . No "ControlPerson" will be created as a result of the Acquisition or thePrivate Placement, and the Acquisition will be an "Arm's Length Transaction" as such terms aredefined in Policy 1.1 of the Exchange. There are no finder's feespayable in connection with the Acquisition.
Trading Halt
Trading in the Common Shares of DeepMarkit is currently halted. While there is no certainty that the Common Shares of the Companywill resume trading until the Acquisition is completed and approved bythe Exchange, the Exchange may allow trading to resume after it hasreviewed initial filings by DeepMarkit with respect to theAcquisition.
AboutDeepMarkit
DeepMarkit is a technology company focused on creating new tools andtechnologies to aid businesses in sales development and increasingprofitability.
DeepMarkit’s Common Shares are listed on the TSX Venture Exchange,symbol MKT.
For more information, please contact:
Interim CEO
Ranjeet Sundher
Tel: 403-537-0067
Email: corp@deepmarkit.com
Neither the TSX Venture Exchange nor its Regulation ServicesProvider (as that term is defined in the policies of the TSX VentureExchange) accepts responsibility for the adequacy or accuracy of thisnews release.
CAUTIONARYSTATEMENT
Statements in this press release may containforward-looking information. Any statements that are contained in thispress release that are not statements of historical fact may be deemedto be forward-looking statements, including statements relating to thecompletion of the Acquisition and the Private Placement, the use ofproceeds from the Private Placement, and the expectation that theExchange will apply the rules of Exchange Policy 5.3 in reviewing theAcquisition. The reader is cautioned that assumptions used in thepreparation of any forward-looking information may prove to beincorrect. Events or circumstances may cause actual results to differmaterially from those predicted, as a result of numerous known andunknown risks, uncertainties, and other factors, many of which arebeyond the control of DeepMarkit. Factors that could cause the actualresults to differ materially from those in forward-looking statementsinclude, but are not limited to, failure to obtain necessary FCCshareholder and regulatory approvals required for Acquisition,inability to complete the Private Placement, or failure to completethe Acquisition on the terms described herein, or at all. The readeris cautioned not to place undue reliance on any forward-lookinginformation. Completion of the Acquisition is subject to a number ofconditions, including but not limited to, execution of a bindingDefinitive Agreement and acceptance by the Exchange.
The forward-looking statements contained in thispress release are made as of the date of this press release andDeepMarkit does not undertake any obligation to update publicly or torevise any of the included forward-looking statements, whether as aresult of new information, future events or otherwise, except asrequired by securities law.
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