Base Carbon Announces Closing of Reverse Takeover Transaction

TORONTO, Feb. 25, 2022 /CNW/ - Base Carbon Corp. (the "Company") is pleased to announce that, further to its news release dated November 5, 2021, the Company has completed the previously announced reverse takeover (the "RTO Transaction") of 1287411 B.C. Ltd., being the resulting issuer, which has changed its name to Base Carbon Inc. ("Base Carbon"). Pursuant to the RTO Transaction, all outstanding common shares of the Company were exchanged for common shares of Base Carbon (the "Resulting Issuer Base Shares") on a one-for-one basis and the previous shareholders of 1287411 B.C. Ltd. retained an aggregate of 760,004 Resulting Issuer Base Shares.

New Board and Management 

Following the RTO Transaction, the leadership team of Base Carbon consists of the following members: 

• Michael Costa — Chief Executive Officer, Director, and Chairman of the Board
• Wes Fulford – Chief Financial Officer
• Philip Hardwick — Chief Operating Officer
• Andrew Fedak —Chief Strategy Officer and Director
• Ryan Hornby — Chief Legal Officer and Corporate Secretary
• Bruce Tozer — Director
• Margot Naudie — Director
• Catherine Flax — Director

Commencement of Trading 

As previously announced, the Company has received conditional approval from the Neo Exchange Inc. ("Neo Exchange") for the listing of Resulting Issuer Base Shares. Base Carbon expects to commence trading on the Neo Exchange on or about March 3, 2022, under the symbol "BCBN". Listing is subject to the Company fulfilling all of the Neo Exchange's final listing requirements on or before March 1, 2022.

Base Carbon currently has 125,339,304 issued and outstanding Resulting Issuer Base Shares and 8,940,000 options to, subject to vesting terms, purchase 8,940,000 Resulting Issuer Base Shares. 

In connection with listing the Resulting Issuer Base Shares on the Neo Exchange, Base Carbon intends to file a listing statement (the "Listing Statement") which sets out additional information related to Base Carbon's business, management and governance, and capitalization. Base Carbon intends to file the Listing Statement under Base Carbon's SEDAR profile (available at www.sedar.com) prior to the commencement of trading on the Neo Exchange.

Additional RTO Transaction Details

The principal steps of the Transaction were as follows: 

1. 1287411 B.C. Ltd. effected a continuance from the Province of British Columbia to the Province of Ontario such that its governing corporate legislation became the Business Corporations Act (Ontario);  
2. in association with the foregoing continuance, 1287411 B.C. Ltd.: 
1. changed its name to "Base Carbon Inc.";  
2. authorized preference shares issuable in series pursuant to the articles of continuance; and 
3. reconstituted its board of directors with directors named above; 
3. existing officers resigned and were replaced with officers named above; 
4. 1287411 B.C. Ltd. consolidated its issued and outstanding common shares on the basis of one post-consolidation Resulting Issuer Base Shares for every 5.394736842 pre-consolidation common share; and 
5. Pursuant to a three-cornered amalgamation agreement, the Company and 1000095223 Ontario Inc., a wholly-owned subsidiary of Base Carbon, amalgamated and retained the name Base Carbon Corp, and (i) the common shares in the capital of the Company were exchanged for Resulting Issuer Base Shares on a one-for-one basis; and (ii) options to acquire common shares of the Company became exercisable for Resulting Issuer Base Shares on the same terms and conditions and on an economically equivalent basis. 

Following the RTO Transaction, Base Carbon's authorized share capital consists of an unlimited number of common shares (being the Resulting Issuer Base Shares) and an unlimited number of preference shares. There are 125,339,304 issued and outstanding Resulting Issuer Base Shares, no issued or outstanding preference shares and 8,940,000 outstanding options to, subject to vesting terms, purchase 8,940,000 Resulting Issuer Base Shares.

Auditor 

In connection with the completion of the RTO Transaction, KPMG LLP, at its principal office in Toronto, Ontario, replaced Baker Tilly WM LLP as the auditor of Base Carbon. 

Early Warning Disclosure 

Abaxx Technologies Inc. ("Abaxx") will file an early warning report in accordance with National Instrument 62-104 – Take-Over Bids and Issuer Bids and National Instrument 62-103 – The Early Warning System and Related Take-Over Bid and Insider Reporting Issues related to the acquisition of 24,431,457 Resulting Issuer Base Shares in connection with the closing of the RTO Transaction (the "Closing"). 

Immediately prior to the Closing, Abaxx did not, directly or indirectly, hold any shares of 1287411 B.C. Ltd. As part of the RTO Transaction, Abaxx exchanged its 24,431,457 common shares of the Company for Resulting Issuer Base Shares such that immediately following the Closing, Abaxx holds, directly, an aggregate of 24,431,457 Resulting Issuer Base Shares (representing approximately 19.49% of the outstanding Resulting Issuer Base Shares on an undiluted basis). The shares held by Abaxx are for investment purposes and are subject to an escrow time based release schedule, as will be more particularly described in the Listing Statement. On February 17, 2022, Abaxx announced that it would distribute 5,091,864 Resulting Issuer Base Shares on March 3, 2022, to Abaxx shareholders of record at the close of business on March 1, 2022, as a return of capital. For more information see the press release of Abaxx dated February 17, 2022.

In accordance with applicable securities laws, Abaxx may, from time to time and at any time, acquire additional shares and/or other equity, debt or other securities or instruments of Base Carbon in the open market or otherwise, and reserves the right to dispose of any or all of such securities in the open market or otherwise at any time and from time to time, and to engage in similar transactions with respect to such securities, the whole depending on market conditions, the business and prospects of Base Carbon and other relevant factors, subject to applicable escrow restrictions. A copy of the early warning report will be filed by Abaxx under Base Carbon's profile on SEDAR at www.sedar.com or may be obtained by emailing [email protected].

About Base Carbon

Base Carbon is in the business of providing capital, development expertise and management operating resources to projects involved primarily in voluntary carbon markets and the broader ESG economy. Base Carbon seeks to be the preferred carbon project partner in providing capital and developmental resources to carbon projects globally and, where appropriate, will endeavour to utilize technologies within the evolving carbon industry to enhance efficiencies, commercial credibility, and trading transparency.

For more information, please visit basecarbon.com.

Excluding the information set out under the heading Early Warning Disclosure, Wes Fulford, Chief Financial Officer, and Ryan Hornby, Chief Legal Officer are responsible for this press release.

The Neo Exchange has in no way passed upon the merits of the Company, Base Carbon or listing of shares and has neither approved nor disapproved of the contents of this news release.

Cautionary Statements Regarding Forward Looking Information

This news release contains "forward-looking information" within the meaning of applicable securities laws relating to the listing and trading of shares on the Neo Exchange, the focus of Base Carbon's business, and intentions of those subject to early warning disclosure requirements. Any such forward-looking statements may be identified by words such as "expects", "anticipates", "intends", "contemplates", "believes", "projects", "plans" and similar expressions. Readers are cautioned not to place undue reliance on forward-looking statements. Statements about, among other things, the expected listing and trading on the Neo Exchange, Base Carbon's strategic plans and the intentions of those subject to early warning disclosure requirements are all forward-looking information. These statements should not be read as guarantees of future performance or results. Such statements involve known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements to be materially different from those implied by such statements. Although such statements are based on management's reasonable assumptions, there can be no assurance that the Neo Exchange will grant final approval in respect of the listing and trading of the Resulting Issuer Base Shares on the Neo Exchange or that, if such listing and trading does occur, it will be completed on the terms and timing described above. Base Carbon assumes no responsibility to update or revise forward-looking information to reflect new events or circumstances or actual results unless required by applicable law. When available, readers are encouraged to refer to the Listing Statement for information as to the risks and other factors which may affect the Base Carbon's business objectives and strategic plans. 

SOURCE Base Carbon Corp.

Investor Relations Contact: Meghna Nair, Manager, Investor Relations, Tel: [phone], E-mail: [email protected]