Toronto, Ontario--(Newsfile Corp. - January 5, 2022) - PC 1 Corp. (TSXV: PCAA.P) (the "Corporation") has entered into a letter of intent (the "Letter of Intent") dated January 3, 2022, for the acquisition of all of the issued and outstanding securities of Cashtag Media Corp. ("Cashtag"). Cashtag is developing an online media platform exclusively focused on investor communications. The Corporation is a capital pool company and intends for the acquisition of Cashtag to constitute the Qualifying Transaction of the Corporation (the "Qualifying Transaction") as such term is defined in the policies of the TSX Venture Exchange (the "Exchange").
Term of Acquisition
Pursuant to the terms of the Letter of Intent, subject to completion of satisfactory due diligence, a definitive purchase agreement (the "Agreement"), receipt of applicable approvals and other standard closing conditions, the Corporation intends to acquire all of the issued and outstanding common shares of Cashtag for consideration consisting of 28,227,273 common shares (prior to any shares to become issuable following the Concurrent Financing (as defined below)) at a deemed price of $0.2125604 per share. Common shares of Cashtag will be converted into common shares of the Corporation on the basis of approximately 1.129090909 Corporation shares for each Cashtag share.
The Qualifying Transaction is an arm's length transaction. No insiders of the Corporation own securities in Cashtag and no insiders of Cashtag own securities in the Corporation. It is intended that the Corporation will complete a name change in connection with the Qualifying Transaction and it will therefore be seeking shareholder approval.
Upon completion of the Qualifying Transaction, the resulting entity (the "Resulting Issuer") will be engaged in the business of Cashtag and interests as may be subsequently acquired by the Corporation.
Certain common shares of the Resulting Issuer to be issued pursuant to the Qualifying Transaction are expected to be subject to restrictions on resale or escrow under the policies of the Exchange, including the securities to be issued to "Principals" (as such term is defined under the policies of the Exchange), which will subject to the escrow requirements of the Exchange. In addition, 25,000,000 common shares of the Corporation issued to the founders of Cashtag will be subject to a contractual 18 month escrow with 10% of such shares being released from the contractual escrow on closing of the Qualifying Transaction and an additional 15% being released every two months thereafter. This contractual escrow is in addition to any regulatory escrow that will apply to the securities of the Corporation to be issued in connection with the Qualifying Transaction.
Concurrent Financing
Prior to or concurrently with the closing of the Qualifying Transaction, Cashtag will complete a private placement raising a minimum of $1,900,000 (the "Concurrent Financing"). The issue price per security in the Concurrent Financing will be no less than $0.2125604 and the specific terms of the Concurrent Financing will be determined by Cashtag. The Corporation will issue a further press release once the terms of the Concurrent Financing are finalized.
Cashtag
Cashtag is building an investor media online platform focused on the investor communications sector using the concept of the "$Cashtag." Cashtag Media Corp, which owns the URL www.CashTag.com, is a new concept based on utilizing web 2.0 social media platforms parlayed with traditional media outlets. Cashtag Media Corp expects to be a top community maker and content creator in traditional investments as well as new and speculative investment areas.
Cashtag is bringing together several top Finfluencers who will broadcast 24/7 "STOCK TALK" podcasts/shows via www.CashTag.com, various social media platforms and beyond. Cashtag is working to combine reach, frequency, influencers and a strong team of creative Capital Market savvy and Social Media savvy individuals with aims to be a disruptive and vertically integrated financial media company.
Cashtag currently has 25,000,000 common shares outstanding (prior to the completion of the Concurrent Financing) and no convertible securities. Currently, 1407535 Ontario Limited, Stacey Farber, 2674775 Ontario Limited, Richlin International, and 8797668 Canada Ltd each hold more than 10% of the outstanding shares of Cashtag. The current directors of Cashtag are Robert Schwartz and Bilal Vakani, and the current officers of Cashtag are Robert Schwartz (President, CEO) and Kyle Appleby (CFO, Secretary).
Sponsorship of Qualifying Transaction
Sponsorship of a qualifying transaction of a capital pool company is required by the Exchange unless exempt in accordance with the Exchange policies. The Corporation is currently reviewing the requirements for sponsorship and may apply for exemption from sponsorship requirements pursuant to the policies of the Exchange, however there is no assurance that the Corporation will ultimately obtain this exemption.
Termination
The letter of intent will terminate (i) on the mutual consent of both the Corporation and Cashtag and (ii) automatically if the Agreement is not executed on or before 5:00 p.m. (Toronto time) on February 14, 2022.
Description of Significant Conditions to Closing
Completion of the Qualifying Transaction is subject to a number of conditions, including but not limited to, Exchange acceptance and obtaining all required shareholder approvals. There can be no assurance that the Qualifying Transaction will be completed as proposed or at all.
Investors are cautioned that, except as disclosed in the management information circular or filing statement to be prepared in connection with the Qualifying Transaction, any information released or received with respect to the Qualifying 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.
The Exchange has in no way passed upon the merits of the Qualifying Transaction and has neither approved nor disapproved the contents of this press release.
All information contained in this news release with respect to the Corporation, Cashtag, and the Resulting Issuer was supplied by the parties, respectively, for inclusion herein.
Additional Information
Additional information concerning the Qualifying Transaction, the Corporation, Cashtag and the Resulting Issuer, including financial information of Cashtag and proposed board and management of the Resulting Issuer, will be provided in subsequent news releases and in the Corporation's Filing Statement to be filed in connection with the Qualifying Transaction, which will be available under the Corporation's SEDAR profile at www.sedar.com.
Upon closing of the Qualifying Transaction, the Resulting Issuer expects to list as a Tier 2 Industrial Issuer on the Exchange.
In accordance with the policies of the Exchange, the Corporation's shares are currently halted from trading and will remain so until such time as the Exchange determines, which, depending on the policies of the Exchange, may not occur until completion of the Qualifying Transaction.
None of the securities to be issued pursuant to the Qualifying Transaction have been or will be registered under the United States Securities Act of 1933, as amended, or any state securities laws, and any securities issued pursuant to the Qualifying Transaction are anticipated to be issued in reliance upon available exemptions from such registration requirements. This press release does not constitute an offer to sell or the solicitation of an offer to buy any securities.
About PC 1 Corp.
The Corporation is a capital pool company within the meaning of the policies of the TSX Venture Exchange that has not commenced commercial operations and has no assets other than cash. Except as specifically contemplated in the policies of the TSX Venture Exchange, until the completion of its "Qualifying Transaction" (as defined therein), the Corporation will not carry on business, other than the identification and evaluation of companies, business or assets with a view to completing a proposed Qualifying Transaction.
The Corporation currently has issued and outstanding 10,350,000 common shares, agent compensation options exercisable to acquire 500,000 common shares at an exercise price of $0.10 per share and incentive stock options exercisable to acquire 1,010,000 common shares at a price of $0.10 per share.
FOR FURTHER INFORMATION PLEASE CONTACT:
Aaron Eisenberg, CEO, CFO, Corporate Secretary and Director
Phone: 416-481-2222
Cautionary Statements
This news release contains forward-looking statements relating to the timing and completion of the Qualifying Transaction and related transactions, the future operations of the Corporation, Cashtag and the Resulting Issuer and other statements that are not historical facts, including statements regarding the anticipated performance of Cashtag as the top community maker and content creator in traditional investments as well as new and speculative investment areas. Forward-looking statements are often identified by terms such as "will", "may", "should", "anticipate", "expects" and similar expressions. All statements, other than statements of historical fact, included in this release are forward-looking statements that involve risks and uncertainties. There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements. Important factors that could cause actual results to differ materially from the Corporation's and Cashtag's expectations include the failure to satisfy the conditions to completion of the Qualifying Transaction or the Concurrent Financing set forth above, the limited business history of Cashtag, general market and industry conditions, competitive conditions, and the impact of the COVID-19 pandemic and other risks detailed from time to time in the filings made by the Corporation and the Resulting Issuer with securities regulators.
The reader is cautioned that assumptions used in the preparation of any forward-looking information may prove to be incorrect. Events or circumstances may cause actual results to differ materially from those predicted, as a result of numerous known and unknown risks, uncertainties, and other factors, many of which are beyond the control of the Corporation, Cashtag and the Resulting Issuer. As a result, the Corporation, Cashtag, and the Resulting Issuer cannot guarantee that the Qualifying Transaction or the Concurrent Financing will be completed on the terms and within the time disclosed herein or at all. The reader is cautioned not to place undue reliance on any forward-looking information. Such information, although considered reasonable by management at the time of preparation, may prove to be incorrect and actual results may differ materially from those anticipated. Forward-looking statements contained in this news release are expressly qualified by this cautionary statement. The forward-looking statements contained in this news release are made as of the date of this news release and the Corporation, Cashtag and the Resulting Issuer will only update or revise publicly any of the included forward-looking statements as expressly required by Canadian securities law.
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Neither TSX Venture Exchange nor its Regulation Services Provider (as such term is defined under the policies of the Exchange) accepts responsibility for the adequacy or accuracy of this release.
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