TORONTO, Sept. 01, 2022 (GLOBE NEWSWIRE) — Blockchain Foundry Inc. (“BCF” or the “Company”) (CSE:BCFN), a leading North American blockchain development firm, today announced that it has entered into a definitive agreement (“ the Agreement”) with WonderFi Technologies Inc. (TSX: WNDR) (“WonderFi”) whereby WonderFi will acquire all issued and outstanding shares of BCF (the “Transaction”).
Dan Wasyluk, CEO of BCF commented, “We are thrilled to join the WonderFi team, which has deep expertise in Web3 and a complementary product mix to BCF’s current products and development initiatives. There are many operational and consumer synergies that we can leverage to improve capabilities across a range of Web3 experiences”.
In January 2022, BCF launched LastKnown, a non-fungible token (“NFT”) minting platform and marketplace for unique NFT drops from artists and collections. BCF has distributed three compilations through the platform to date from a number of award-winning artists. In May 2022, BCF also launched a beta version of Metacademy, a learn-to-earn educational platform focused on hands-on learning in a user-friendly environment, teaching users how to set up a crypto wallet, how to create, buy and sell NFTs, the differences between Web2 and Web3, and how to better understand the metaverse, among other things.
“This acquisition further strengthens WonderFi as the Canadian leader in the digital asset space,” commented Ben Samaroo, CEO of WonderFi. “BCF is on a great trajectory with a diverse set of intellectual property, brand partnerships and a revenue-generating track record. The current economic conditions in the crypto market have made it attractive for WonderFi to be able to acquire companies like BCF that have the potential to compliment our core operational trading platforms for crypto assets Bitbuy and Coinberry, while adding cash, liquid digital assets and a portfolio of private emerging crypto investments to WonderFi’s balance sheet”.
Important transaction benefits
- Adds immediate scale to BCF’s product offering through WonderFi’s user base across the Bitbuy and Coinberry platforms.
- Accelerating the growth of full-service Web3 initiatives through improved consumer channels and larger development ecosystem.
- Provides significant consumer and operational synergies across BCF’s complete product line and development initiatives.
Transaction details
Pursuant to the terms of the Agreement, WonderFi will acquire all 121,975,844 issued and outstanding common shares of BCF on the basis of 0.2155 common shares of WonderFi for each share of BCF held (the “Exchange Ratio”). Warrants and options for BCF will be adjusted or exchanged to become respectively warrants and options for WonderFi based on the Exchange Ratio. As of the date hereof, WonderFi has 193,875,490 issued and outstanding ordinary shares, and it is expected that approx. 26,285,794 ordinary shares in WonderFi will be issued to shareholders in BCF as consideration (“the consideration shares”), representing approx. 13.4% of the issued and outstanding shares in the company, which will be subject to a normal working capital adjustment. It is expected that approx. 6,544,840 consideration shares (the “Retention Shares”) will be subject to withholding for the working capital adjustment, and the retention shares will be issued, if at all, as soon as the final working capital is determined between the parties. If the closing working capital is below the target amount for closing working capital, WonderFi shall be entitled to reduce the remuneration to the shareholders of BCF by an amount equal to the working capital shortfall multiplied by 1.5, which will be satisfied by WonderFi not issuing a corresponding number of retained shares. If the closing working capital is above the target amount of closing working capital, all of the Holdback Shares shall be issued to the shareholders of BCF and the aggregate consideration to the shareholders of BCF shall be increased by an amount equal to the excess working capital, subject to a maximum amount of $3 million, which will be satisfied by WonderFi issuing additional ordinary shares to BCF shareholders. A total of 5,260,039 shares in WonderFi will be issuable to the principals of BCF (“principal shares”), which principal shares will be subject to a contractual escrow arrangement pursuant to which the principal shares will be released from escrow 1/5 at closing and in subsequent tranches of 1 /5 every 3 months thereafter.
The transaction was negotiated at arm’s length, will be carried out using a legally approved arrangement plan in accordance with Business Companies Act (British Columbia). The transaction is subject to a number of conditions being met or waived by one or both of WonderFi and BCF at or prior to the closing of the transaction, including the approval of BCF stockholders, receipt of all necessary regulatory, stock exchange and court approvals, and the satisfaction of certain other closing conditions which are usual for a transaction of this nature.
The Agreement includes customary provisions, including non-solicitation, right to match and trustee provisions, as well as certain representations, covenants and conditions customary in a transaction of this nature. A termination fee of $350,000 may be paid by BCF to WonderFi in the event of certain termination events. Further information about the Transaction will be contained in the management information circular to be prepared by BCF and sent to the shareholders in connection with a special meeting of shareholders to assess and approve the Transaction and related matters. The extraordinary shareholders’ meeting is expected to be held on or before 31 October 2022. All BCF shareholders are encouraged to read the information circular when it is available, as it will contain important additional information about the Transaction.
The board’s recommendations and voting support
The transaction has been unanimously approved by the board of both WonderFi and BCF. Directors and officers of BCF who together own 20.01% of its issued and outstanding ordinary shares have entered into customary voting support agreements agreeing to vote in favor of the Transaction.
Sequeira Partners has provided a fairness opinion to the board of directors of BCF that the consideration to be paid by WonderFi to the shareholders of BCF, based on and subject to the assumptions, limitations and qualifications set forth therein as of the date hereof, the Transaction is fair, from an economic point of view, for the shareholders of BCF.
This announcement is for information purposes only and does not constitute an offer to buy, a solicitation of an offer to sell shares or a solicitation of a proxy. Some of BCF’s expected products and services may be subject to regulatory review. The transaction is expected to close in the fourth quarter of 2022. A copy of the agreement will be available on BCF’s SEDAR profile at www.sedar.com.
Additional information
For further information, please contact:
Blockchain Foundry Inc.
Dan Wasyluk
CEO
(647) 792-8782
WonderFi Technologies Inc.
Ben Samaroo, CEO
(778) 843-9637
About BCF
BCF develops and commercializes blockchain-based business and consumer solutions, focusing on infrastructure for digital assets and NFTs. BCF also offers blockchain consulting services to corporate clients.
About WonderFi
WonderFi is a leading technology company with the task of creating better, unified access to digital assets through centralized and decentralized platforms. WonderFi’s management team and board have an established track record in finance and crypto, with previous experience from Amazon, Shopify, PayPal, Galaxy Digital and Hut 8. WonderFi’s core team of engineers and technologists believe that everyone should have equal access to funding, and are aligned with the mission to give people all over the world access to finance in a simple, smart and secure way. For more information, visit www.wonder.fi.
Forward-looking information
This press release contains certain “forward-looking information” under applicable Canadian securities laws and may also contain statements that may constitute “forward-looking statements” under the safe harbor provisions of the United States Private Securities Litigation Reform Act of 1995 and applicable Canadian securities laws. Such forward-looking information and forward-looking statements are not representative of historical facts or information or current conditions, but instead represent only the Company’s beliefs regarding future events, plans or goals, many of which are inherently uncertain and outside of expectations. of the company’s control. In general, such forward-looking information or forward-looking statements can be identified by the use of forward-looking terminology such as “could”, “believed”, “expect”, “believe”, “will”, “projected”, “estimated”. “, or variations of such words.
By identifying such information and statements in this manner, the Company cautions the reader that such information and statements are subject to known and unknown risks, uncertainties and other factors that may cause the Company’s actual results, level of activity, performance or achievements. to be materially different from those expressed or implied by such information and statements. In addition, in connection with forward-looking information and forward-looking statements in this press release, the company has made certain assumptions. Among the key factors that could cause actual results to differ materially from those projected in the forward-looking information and statements are the following: WonderFi’s and BCF’s ability to complete the proposed transaction; BCF’s ability to secure the necessary securityholder approval of the proposed transaction; WonderFi’s and BCF’s ability to secure the necessary legal and regulatory approvals required to complete the transaction; WonderFi’s ability to achieve the synergies expected as a result of the Transaction; BCF’s ability to meet its working capital target and the adjustment of the consideration to be paid to BCF shareholders pursuant to the proposed transaction; material adverse changes in general economic, business and political conditions, including changes in financial markets, changes in applicable laws and compliance with extensive government regulation. Should one or more of these risks, uncertainties or other factors materialize, or should assumptions underlying forward-looking information or statements prove to be incorrect, actual results may differ materially from those described herein.
Although the company believes that the assumptions and factors used in the preparation of, and expectations in, the forward-looking information and statements are reasonable, undue reliance should not be placed on such information and statements, and no assurance or guarantee can be given that such forward-looking information and statements will prove to be accurate, as actual results and future events may differ materially from those anticipated in such information and statements. The forward-looking information and forward-looking statements contained in this press release are made as of the date of this press release, and the Company undertakes no obligation to update any forward-looking information and/or forward-looking statements contained or referred to herein, except in accordance with applicable securities laws. All subsequent written and oral forward-looking information and statements attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by this announcement. All values stated in this release are in Canadian dollars.
This press 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 (“US 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 announced under the US Securities Act, unless registered under the US Securities Act and applicable state securities laws or an exemption from such registration requirements is available.
