Vancouver, British Columbia--(Newsfile Corp. - October 4, 2023) - Penbar Capital Ltd. (TSXV: PEM.P) ("Penbar") is pleased to announce that it has entered into a non-binding letter of intent dated October 3, 2023 (the "LOI") with Emissions EV Technologies Inc. ("Emissions EV") pursuant to which Penbar proposes to acquire all of the issued and outstanding securities of Emissions EV in exchange for the issuance of securities of Penbar, which will result in Emissions EV becoming a wholly-owned subsidiary of Penbar (the "Transaction"). The Transaction, assuming the completion of the Financing (as defined below), will result in a reverse take-over by Emissions EV where the existing shareholders of Emissions EV will own a majority of the outstanding common shares of Penbar (the "Penbar Shares") and Penbar is anticipated to be renamed, subject to shareholder approval, to a name to be determined by Emissions EV (the "Resulting Issuer"). Upon completion of the Transaction, it is anticipated that the Resulting Issuer will be an industrial issuer focused on the design, manufacturing, and production of cutting-edge electrically powered industrial and commercial vehicles.
Trading of the Penbar Shares will be halted in accordance with the policies of the TSX Venture Exchange (the "TSXV") and will remain halted until such time as all required documentation in connection with the Transaction has been filed with and accepted by the TSXV and permission to resume trading has been obtained from the TSXV.
The Qualifying Transaction
Penbar is a capital pool company and intends that the Transaction will constitute its "Qualifying Transaction" under the policies of the TSXV. The Transaction will not constitute a non-arm's length qualifying transaction or a related party transaction pursuant to the policies of the TSXV.
Pursuant to the terms and conditions of the LOI, Penbar and Emissions EV will negotiate and enter into a definitive agreement (the "Definitive Agreement") incorporating the principal terms of the Transaction as described in the LOI and this press release. There is no assurance that a Definitive Agreement will be successfully negotiated or entered into. The LOI is expected to be superseded by the Definitive Agreement.
As consideration for the acquisition of all of the outstanding securities of Emissions EV, holders of issued and outstanding common shares of Emissions EV ("Emissions EV Shares") will receive one (1) Resulting Issuer common share (the "Resulting Issuer Common Shares") for each one (1) Emissions EV Share (the "Exchange Ratio"). Excluding any securities issued in connection with the Financing (as defined below), immediately prior to the closing of the Transaction, it is anticipated that: (i) holders of Emissions EV Shares will hold 67,091,767 Emissions EV Shares; (ii) holders of 15,500,000 common share purchase warrants of Emissions EV will be entitled to receive an aggregate of approximately 15,500,000 warrants of the Resulting Issuer pursuant to the Exchange Ratio; and (iii) holders of 10,000,000 performance warrants will be entitled to receive an aggregate of approximately 10,000,000 performance warrants of the Resulting Issuer pursuant to the Exchange Ratio. The final structure of the Transaction is subject to the receipt of tax, corporate and securities law advice by both Penbar and Emissions EV.
Immediately prior to the completion of the Transaction, it is anticipated that: (i) Penbar will consolidate its issued and outstanding Penbar Shares on the basis of approximately two (2) pre-consolidation Penbar Shares for each one (1) post-consolidation Penbar Share (the "Penbar Consolidation Ratio") as a condition to the completion of the Transaction (the "Penbar Capital Consolidation"). All incentive stock options of Penbar are anticipated to be adjusted on the basis of the Penbar Consolidation Ratio. Prior to or concurrent with the completion of the Transaction, the parties will use commercially reasonable efforts in order to complete a financing (the "Financing"), with such Financing to be priced as and in an amount as is mutually agreed to by the parties. Further terms and conditions of the Financing will be announced by the parties at a later date.
Conditions of the Transaction
The completion of the Transaction is subject to a number of conditions precedent, including but not limited to: satisfactory due diligence review; negotiation and execution of the Definitive Agreement and accompanying transaction documents; approval by the boards of directors of each of Penbar and Emissions EV; if necessary, approval of the shareholders of each of Penbar and Emissions EV for all matters required in connection with the Transaction, including the Penbar Capital Consolidation and name change; obtaining necessary third party approvals; closing of the Financing for minimum aggregate gross proceeds to be determined by the parties; and the TSXV's approval for listing the shares of the Resulting Issuer. There can be no assurance that the Transaction or the Financing will be completed as proposed, or at all.
Sponsorship of Transaction
Sponsorship of a qualifying transaction of a Capital Pool Company is required by the TSXV unless exempt in accordance with the policies of the TSXV. Penbar intends to apply for such an exemption.
Trading Halt
Trading in the securities of Penbar will be halted until the completion of the Transaction.
Additional Information
If and when a Definitive Agreement is executed, Penbar will issue a subsequent press release in accordance with the policies of the TSXV containing details of the Definitive Agreement and additional terms of the Transaction, including information relating to sponsorship, summary financial information in respect of Emissions EV, and to the extent not contained in this press release, additional information with respect to the Financing, history of Emissions EV, and the proposed directors, officers, and insiders of the Resulting Issuer upon completion of the Transaction.
About Emissions EV Technologies Ltd.
Located in New Westminster, British Columbia, Emissions EV specializes in the design, manufacturing, and production of cutting-edge electrically powered industrial and commercial vehicles. Emissions EV is dedicated to revolutionizing the logistics and production sector by providing sustainable transportation solutions that are at the forefront of the EV industry today. Emissions EV collaborative approach involves close engagement with its customers, allowing them to contribute their unique needs and insights to the project, ensuring that the machines that are created for their use are completely without compromise.
Based in New Westminster, British Columbia, Emissions EV creates environmentally friendly, efficient, and reliable vehicles that not only meet industry standards and regulatory requirements but also partner with local suppliers and vendors to manage and maintain the strictest in compliance and finished product quality.
By combining our technical capabilities with its ingenious design engineering support, Emissions EV aims to drive innovation, reduce emissions, and usher in a brighter, more sustainable future in hard to decarbonize sectors of global industry.
About Penbar Capital Ltd.
Penbar Capital Ltd. is a capital pool company created pursuant to the policies of the TSXV. It does not own any assets, other than cash or cash equivalents and its rights under the LOI. The principal business of Penbar is to identify and evaluate opportunities for the acquisition of an interest in assets or businesses and, once identified and evaluated, to negotiate an acquisition or participation subject to acceptance by the TSXV so as to complete a Qualifying Transaction in accordance with the policies of the TSXV.
For further information please contact:
Penbar Capital Ltd.
David Eaton, CEO
Phone: (604) 688-9588
All information in this press release relating to Emissions EV has been provided by Emissions EV and is the sole responsibility of Emissions EV.
This news release does not constitute an offer to sell or a solicitation of an offer to buy any of the securities described herein in the United States. The securities described herein have not been registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act"), or any state securities law and may not be offered or sold in the "United States", as such term is defined in Regulation S promulgated under the U.S. Securities Act, unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration requirements is available.
Cautionary Note
Completion of the Transaction is subject to a number of conditions, including but not limited to, TSXV acceptance and, if applicable pursuant to TSXV requirements, majority of the minority shareholder approval. Where applicable, the Transaction cannot close until the required shareholder approval is obtained. There can be no assurance that the 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 transaction, any information released or received with respect to the 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 TSXV has in no way passed upon the merits of the proposed transaction and has neither approved nor disapproved the contents of this press release.
Neither the TSXV nor its Regulation Services Provider (as that term is defined in policies of the TSXV) accepts responsibility for the adequacy or accuracy of this press release.
Forward-Looking Statements
This news release contains "forward-looking information" within the meaning of applicable securities laws relating to the proposal to complete the Transaction and associated transactions, including statements regarding the terms and conditions of the Transaction, the name change of Penbar, the Penbar Capital Consolidation, the Financing, the use of proceeds of the Financing, and the proposed directors and officers of the Resulting Issuer. The information about Emissions EV contained in the press release has not been independently verified by Penbar. Although Penbar believes in light of the experience of its officers and directors, current conditions and expected future developments and other factors that have been considered appropriate that the expectations reflected in this forward-looking information are reasonable, undue reliance should not be placed on them because Penbar can give no assurance that they will prove to be correct. Readers are cautioned to not place undue reliance on forward-looking information. Actual results and developments may differ materially from those contemplated by these statements depending on, among other things, the risks that the parties will not proceed with the Transaction, the Penbar Capital Consolidation, the name change of Penbar, the Financing, the appointment of the proposed directors and officers of the Resulting Issuer and associated transactions, or that the ultimate terms of the Transaction, the Penbar Capital Consolidation, the name change, the Financing, the appointment of the proposed directors and officers of the Resulting Issuer and associated transactions will differ from those that currently are contemplated, or that the Transaction, the Penbar Capital Consolidation, the name change of Penbar, the Financing, the appointment of the proposed directors and officers of the Resulting Issuer and associated transactions will not be successfully completed for any reason (including the failure to obtain the required approvals or clearances from regulatory authorities). The terms and conditions of the Transaction may change based on Penbar's due diligence and the receipt of tax, corporate and securities law advice for both Penbar and Emissions EV. The statements in this press release are made as of the date of this press release. Penbar undertakes no obligation to comment on analyses, expectations or statements made by third-parties in respect of Penbar, Emissions EV, their securities, or their respective financial or operating results (as applicable). There can be no assurance that the Transaction will be completed or, if completed, will be successful.
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