Kiaro Holdings Corp (KO-X) Quote
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Kiaro Holdings Corp. (TSXV:KO.VN) (the “Company”) is pleased to announce the closing of its previously announced qualifying transaction resulting in the reverse takeover of DC Acquisition Corp. (“DCA”) by Kiaro Brands Inc. (the “Qualifying Transaction”).
The Transaction
Effective October 13, 2020, as a condition to the completion of the Qualifying Transaction, DCA changed its name to “Kiaro Holdings Corp.” and consolidated its share capital (the “Consolidation”) on the basis of 1.7142857143 (old) common shares for 1 (new) common share. Immediately following the Consolidation, DCA had an aggregate of 20,416,663 common shares outstanding.
Pursuant to the terms of the Qualifying Transaction, Kiaro Brands Inc. (“Kiaro”), a private British Columbia company, amalgamated with 1251542 B.C. Ltd. (“DCA Subco”), a wholly owned subsidiary of DCA, by way of a three cornered amalgamation pursuant to a merger agreement dated June 9, 2020, a copy of which is available under the Company’s profile on SEDAR at www.sedar.com, and all outstanding securities of Kiaro were exchanged (the “Securities Exchange”) for post-Consolidation securities of DCA on a 1:1 basis, resulting in approximately 107,993,707 post-Consolidation DCA common shares being issued to former shareholders of Kiaro. An additional 45,155,309 post-Consolidation DCA common shares were issued to holders of certain convertible securities of Kiaro who exercised their conversion rights immediately prior to the completion of the Qualifying Transaction. Further details regarding the Qualifying Transaction can be found in the filing statement of DCA and Kiaro dated September 29, 2020 (the “Filing Statement”), a copy of which is available under the Company’s profile on SEDAR at www.sedar.com.
The parties to the Qualifying Transaction have made their final submission to the TSX Venture Exchange (the “Exchange”) in connection with the Exchange’s issuance of its listing bulletin.
It is anticipated that the common shares of the Company will commence trading on the Exchange under the trading symbol “KO” on or about October 19, 2020.
Escrowed Shares
On completion of the Qualifying Transaction, certain Principals (as defined policies of the Exchange) of the resulting issuer holding an aggregate of 48,826,752 common shares of the Company are subject to escrow in accordance with section 6.2 of Policy 5.4 – Escrow, Vendor Consideration and Resale Restrictions of the Exchange (“Policy 5.4”). Pursuant Policy 5.4, 10% of the escrowed shares will be released at the time of the Final Exchange Bulletin, with an additional 15% released on each 6 month anniversary thereafter.
In addition, certain current and/or former shareholders of DCA have entered into a CPC Escrow Agreement (the “CPC Escrow Agreement”) with the Exchange and TSX Trust Company, as escrow agent, in respect of 6,547,913 post-Consolidation DCA common shares. Under the terms of the CPC Escrow Agreement, 10% of the escrowed shares will be released at the time of the Final Exchange Bulletin, with an additional 15% released on each 6 month anniversary thereafter. Concurrent with closing, Odyssey Trust Company replaced TSX Trust Company as escrow agent in respect of the CPC Escrow Agreement.
In addition, on completion of the Qualifying Transaction, certain former shareholders of Kiaro holding an aggregate of 5,174,510 common shares of the Company are subject to seed share resale restrictions (“SSRR”) pursuant to section 10 of Policy 5.4. Under the policies of the Exchange, 10% of all shares subject to SSRR are released at the time of the Final Exchange Bulletin, with 15% released on each 6 month anniversary thereafter.
In addition, on completion of the Qualifying Transaction, certain former shareholders of Kiaro holding an aggregate of 44,488,925 common shares of the Company are subject to certain contractual pooling restrictions (the “Pooling Restrictions”). Pursuant to the Pooling Restrictions, 20% of the pooled shares will be released on the listing date of the Company’s common shares, with an additional 20% released on each 6 month anniversary thereafter.
Board of Directors and Executive Management
Following the completion of the Qualifying Transaction, the following individuals will comprise the directors and officers of the Company:
Daniel Petrov – Director and Chief Executive Officer
Janet Hoffar – Director, Chief Financial Officer and Corporate Secretary
Herrick Lau – Director
Shawn Graham – Director
Zachary Stadnyk – Director
Eleanor Lynch – President of Operations
Auditors
Concurrent with the closing of the Qualifying Transaction, MNP LLP has been appointed auditors of the Company.
Year End
Following completion of the Qualifying Transaction, the fiscal year end of the Company shall be January 31. In accordance with applicable laws, the Company will publish unaudited interim financial statements of Kiaro Brands Inc. for the six (6) months ended July 31, 2020 within 10 days of the completion of the Qualifying Transaction.
Additional Information for Shareholders
The Company’s transfer agent, Odyssey, will be mailing Direct Registration System statements to all former Kiaro shareholders (other than for those that are required to be in certificated form) setting out each holder’s shareholdings. The CUSIP number for Kiaro common shares is 49374K100.