Cypher Metaverse Inc (CSE:CODE, OTCQB:BKLLF) told investors it has entered into a binding definitive agreement to merge with Agapi Luxury Brands in a deal that it expects to meet the listing requirement for an industrial issuer under the CSE Venture Exchange’s policies.
Cypher said in a statement that its shares remain halted in the meantime and it does not expect trading to resume before the transaction closes.
Under the deal, which will be put to a shareholder vote on December 1, 2023, holders of Agapi common stock will receive 0.7601 Cypher shares in exchange for each Agapi share, and all outstanding Agapi warrants will be replaced with equivalent or exchangeable securities.
The management and board of the combined company, as well as a new name, will be determined by Agapi, the company added.
Cypher said it is being represented in the negotiations for the business combination by a special committee made up of independent directors as it is a non-arms length transaction as its CEO is a significant shareholder of Agapi.
The companies also announced that Agapi intends to raise gross proceeds of $750,000 through a private placement of its shares to accredited investors at $0.12 each as a condition of the transaction.
The equity financing is intended to be completed prior to or concurrently with the closing of the transaction and the net proceeds will be used for working capital and general corporate purposes.
Cypher Metaverse seeks early-stage investments in emerging technology sectors, including the blockchain ecosystem, fintech and the metaverse.
The company identifies such opportunities and applies its relationships and capital to advance its interests.
Contact the author at stephen.gunnion@proactiveinvestors.com