TSX-V: SUN
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VANCOUVER, BC, Sept. 25,
2024 /CNW/ - Stardust Solar Energy Inc.
(formerly known as Bold Capital Enterprises Ltd.) (TSXV:
SUN) (the "Company"), announces that it has completed its
"Qualifying Transaction" in accordance with Policy 2.4 – Capital
Pool Companies of the TSX Venture Exchange (the
"Exchange") pursuant to which the Company acquired all
of the issued and outstanding shares of Stardust Solar Holdings
Inc. ("Stardust") in exchange for the issuance of common
shares of the Company pursuant to an amalgamation (the
"Transaction").
The Company's common shares are expected to begin trading on the
Exchange on or about October 7, 2024,
at the market open, under the symbol "SUN".
The Transaction
On December 27, 2023, the Company
and Stardust entered into an amalgamation agreement (the
"Amalgamation Agreement"), pursuant to which the parties
agreed to complete a three-cornered amalgamation under the
Business Corporations Act (British
Columbia) whereby 1503269 B.C.
Ltd. (formerly 14204344 Canada Inc.) ("Subco"), a
wholly-owned subsidiary of the Company, amalgamated with Stardust,
and the Company acquired all of the issued and outstanding Stardust
common shares (the "Stardust Shares"). The shareholders of
Stardust received post-Consolidation (as defined below) common
shares of the Company (the "Common Shares") in exchange for
their Stardust Shares, resulting in a reverse takeover of the
Company by Stardust. The amalgamated corporation resulting from the
amalgamation of Subco and Stardust is wholly-owned by the
Company.
Prior to the completion of the Transaction, the Company
consolidated its outstanding Common Shares on the basis of one (1)
new Common Share for each 2.4876 old Common Shares (the
"Consolidation"), such that, immediately prior to closing of
the Transaction, the Company had 19,000,040 post-Consolidation
Common Shares issued and outstanding. In connection with the
completion of the Transaction, post-Consolidation Common Shares
were issued to holders of Stardust Shares on the basis of one (1)
post-Consolidation Common Shares for each one (1) Stardust Share
(the "Exchange Ratio"), resulting in the issuance of an
aggregate of 51,394,012 post-Consolidation Common Shares to the
shareholders of Stardust. Outstanding Stardust options, warrants
and restricted share units are exercisable for post-Consolidation
Common Shares, with the number and exercise price adjusted to
reflect the Exchange Ratio, in accordance with the terms of such
options and warrants, as applicable.
Prior to the completion of the Transaction, the Company
completed a name change from "Bold Capital Enterprises Ltd." to
"Stardust Solar Energy Inc.". The Company will continue the
business previously conducted by Stardust.
The Transaction is subject to final acceptance from the
Exchange. Upon such final acceptance, the Exchange is expected to
issue its final bulletin confirming the completion of the
Qualifying Transaction and the listing of the Company as a Tier 2
Technology Issuer. The Company expects its shares to begin trading
on the Exchange under the trading symbol "SUN" on or about
October 7, 2024.
In connection with the completion of the Transaction, the
Company will change the province in which the Company's registered
office is situated from Quebec to
British Columbia, as approved by
the shareholders of the Company at the annual general and special
meeting held on February 12, 2024
(the "AGSM"). In addition, upon completion of the
Transaction, the Company's new omnibus incentive plan (the
"Omnibus Plan") came into immediate effect, as approved by
the shareholders of the Company at the AGSM. Under the Omnibus
Plan, the aggregate number of Common Shares reserved for issuance
pursuant to awards of options granted under the Omnibus Plan shall
not exceed 10% of the Company's total issued and outstanding Common
Shares from time to time. In respect of DSUs, RSUs or PSUs, the
aggregate number of Common Shares reserved for issuance pursuant to
awards other than for options granted under the Omnibus Plan shall
not exceed 7,000,000 Common Shares. For additional details
regarding the Omnibus Plan, please see the Filing Statement (as
defined below) and the Company's management proxy circular dated
January 15, 2024, which are available
under the Company's SEDAR+ profile at www.sedarplus.ca.
Concurrent Financings
Subscription Receipt Financing
On September 12, 2024, Stardust
completed a private placement of 130,000 subscription receipts (the
"Stardust Subscription Receipts") at a price of $0.30 per subscription receipt for gross proceeds
of $39,000. On September 17, 2024, Each Stardust Subscription
Receipt converted into one Stardust Share and one Stardust warrant,
upon the satisfaction of certain conditions. Such Stardust Shares
and warrants were subsequently exchanged for equivalent securities
of the Company upon completion of the Transaction, in accordance
with the terms of the Amalgamation Agreement. Each warrant
underlying the Stardust Subscription Receipts is exercisable into
one Common Share at a price of $0.40
per share for a period of 24 months from the date of issuance.
Convertible Loans
On August 22, 2024, Stardust
entered into convertible loan agreements with certain lenders (the
"Lenders"), pursuant to which Stardust borrowed an aggregate
of $260,000 (the "Convertible
Loans"). The maturity date of the Convertible Loans is two
years from the date of issuance. The Convertible Loans bear
interest at a rate of 12% per annum, which shall become due and
payable on the maturity date, unless an event of default
occurs.
If an event of default occurs and is not remedied within the
applicable cure period, the applicable Lender may demand that
Stardust immediately repay the applicable Convertible Loan, which
shall become immediately due and payable. Subject, however,
to the applicable Lender's discretionary right to waive any breach
by Stardust of the terms of the applicable Convertible Loan.
The Lenders have the option to convert the Convertible Loans, at
any time before the maturity date, into units of the Company (the
"Units") at a price of $0.40
per Unit. Each Unit will consist of one Common Share and one common
share purchase warrant of the Company. Each warrant will entitle
the holder to acquire one Common Share for a period of two years
from the date of issuance at an exercise price of $0.40 per share.
Mark Tadros, Chief Executive
Officer, Chairman and a Director of the Company, subscribed for
Convertible Loans in the principal amount of $80,000. Mr. Tadros is a "related party" of the
Company within the meaning of Multilateral Instrument 61-101 –
Protection of Minority Security Holders in Special
Transaction ("MI 61-101"). As a result, the private
placement of Convertible Loans is considered to be a "related party
transaction" as such term is defined in MI 61-101. The
participation of Mr. Tadros in the private placement of Convertible
Loans is exempt from formal valuation and minority shareholder
approval requirements pursuant to exemptions contained in sections
5.5(a) and 5.7(1)(a) of MI 61-101.
Secured Loan
On September 11, 2024, Stardust
entered into a secured, non-convertible loan agreement with an
arm's length party (the "Secured Lender"), pursuant to which
Stardust will borrow $448,000 from
the Secured Lender (the "Secured Loan"). The maturity date
of the Secured Loan will be two years from the date of issuance. In
connection with the Secured Loan, Stardust shall grant the Secured
Lender first priority charge on all of Stardust's present and
after-acquired personal property.
The Secured Loan shall bear interest at a rate of 24% per annum.
Interest-only payments shall be due and payable on the first day of
each month. The principal amount of the Secured Loan shall become
due and payable on the maturity date, unless an event of default
occurs.
If an event of default occurs and is not remedied within the
applicable cure period, the Secured Lender may demand that Stardust
immediately repay the Secured Loan, which shall become immediately
due and payable. Subject, however, to the Secured Lender's
discretionary right to waive any breach by Stardust of the terms of
the Secured Loan.
The Secured Loan is subject to an original issue discount of
$48,000 (equal to 10.7% of the
Secured Loan). Furthermore, Stardust must pay the Secured Lender a
closing fee of $12,320, equal to
2.75% of the Secured Loan. Stardust must also pay the costs and
expenses related the Secured Loan, including the Secured Lender's
legal fees of up to $10,000
(exclusive of all taxes, disbursements and other miscellaneous
costs).
BDC Loan
On August 21, 2024, Stardust Solar
Technologies Inc., a wholly-owned subsidiary of Stardust, obtained
an unsecured, non-convertible loan in the principal amount of
$100,000 from Business Development
Canada (the "BDC Loan"). The maturity date of the BDC Loan
is five years from the date of issuance. The BDC Loan bears
floating interest at a rate of 11.97% per annum. For the first six
(6) months of the term, interest-only payments will occur on a
monthly basis (no principal payments). Following the first six (6)
months of the term, applicable interest and principal payments will
occur on a monthly basis.
Outstanding Share Capital and Escrow
As a result of the Transaction, there are an aggregate of
70,394,052 post-Consolidation Common Shares issued and outstanding,
of which the previous shareholders of the Company hold
approximately 27% and former shareholders of Stardust hold
approximately 73%, respectively.
Stardust shareholders representing an aggregate of 49,774,661
post-Consolidation Common Shares and 3,539,474 restricted share
units are subject to Tier 2 Value Escrow Agreements.
Management and Director Changes
Upon completion of the Transaction, all directors and officers
of the Company have resigned and were replaced by the following
nominees of Stardust: (i) Mark
Tadros – Chief Executive Officer, Chairman and Director;
(ii) Eamonn McHugh – Chief Operating
Officer and Director; (iii) Vitaly
Melnikov – Chief Financial Officer, Corporate Secretary and
Director; (iv) Evan Kraemer – Chief
Technology Officer; (v) Young Bann –
Director; and (vi) Ohad David –
Director.
Change of Auditor
In connection with the completion of the Transaction, Mallette
LLP will resign as auditor of the Company and Davidson &
Company LLP, auditor of Stardust, will be appointed as auditor of
the Company. In the opinion of the Company, no "reportable event"
(as such term is defined in National Instrument 51-102 – Continuous
Disclosure Obligations ("NI 51-102")) has occurred. The
Company is relying on section 4.11(3)(a) of NI 51-102 for an
exemption from the change of auditor requirements within section
4.11 of NI 51-102.
SinuSafe Update
The Company, through its Israeli legal counsel, appeared before
the Israeli court at the pre-hearing held on September 17, 2024 and which was scheduled to
consider certain matters pertaining to the Company's proceedings
against SinuSafe Medical Ltd. ("SinuSafe") in respect of the
$350,000 secured loan (plus accrued
and unpaid interest) payable to the Company. The Company is pleased
that it is finally making positive progress in Israel with respect to recovering the amounts
loaned to SinuSafe and it will continue to engage with its Israeli
legal counsel to pursue its rights under the secured loan.
The Company will provide such further updates regarding the status
of its claims against SinuSafe as may be appropriate.
Additional Information
For additional information concerning the Transaction and the
foregoing matters, please refer to the Company's news releases
dated January 4, 2024 and
August 14, 2024, and the Company's
filing statement dated August 13,
2024 (the "Filing Statement") which is available
under the Company's SEDAR+ profile at www.sedarplus.ca.
About the Company
Stardust is a British Columbia
based company that is a franchisor of renewable energy installation
services, including solar panels (PV), energy storage systems, and
electric vehicle supply equipment. Stardust lends its brand and
business management services to entrepreneurs looking to enter the
industry of renewable energies. Stardust franchisees install and
maintain clean energy systems for residential and commercial
purposes. As a franchisor, Stardust supplies its franchisees with
the following products: solar PV equipment, energy storage
equipment, and electric vehicle supply equipment. In addition,
Stardust supports its franchisees with many services from corporate
headquarters including marketing, sales, engineering, plan sets,
customer service, and project management.
ON BEHALF OF THE BOARD OF DIRECTORS OF STARDUST SOLAR ENERGY
INC.
Mark Tadros
Chief Executive Officer, Chairman and Director
Website: www.stardustsolar.com
Neither TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release.
Investors are cautioned that, except as disclosed in the
Filing Statement 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 the Company should be considered
highly speculative.
The TSX Venture Exchange Inc. has in no way passed upon the
merits of the Transaction and has neither approved nor disapproved
the contents of this press release.
This news release does not constitute an offer to sell or a
solicitation of an offer to sell any of the securities in
the United States. The securities
have not been and will not be registered under the United States
Securities Act of 1933, as amended (the "U.S. Securities
Act") or any state securities laws and may not be offered or
sold within the United States or
to U.S. Persons unless registered under the U.S. Securities Act and
applicable state securities laws or an exemption from such
registration is available.
The information in this news release includes certain
information and statements about management's view of future
events, expectations, plans and prospects that constitute forward
looking statements, including statements relating to the final
acceptance by the Exchange, the issuance of a final bulletin by the
Exchange, the business plans of the Company, the SinuSafe
proceedings and the recovery of any amounts loaned to SinuSafe.
These statements are based upon assumptions that are subject to
significant risks and uncertainties. Because of these risks and
uncertainties and as a result of a variety of factors, the actual
results, expectations, achievements or performance may differ
materially from those anticipated and indicated by these forward
looking statements. Any number of factors could cause actual
results to differ materially from these forward–looking statements
as well as future results. Although the Company believes that the
expectations reflected in forward looking statements are
reasonable, it can give no assurances that the expectations of any
forward looking statements will prove to be correct. Except as
required by law, the Company disclaims any intention and assumes no
obligation to update or revise any forward looking statements to
reflect actual results, whether as a result of new information,
future events, changes in assumptions, changes in factors affecting
such forward looking statements or otherwise.
SOURCE Stardust Solar Energy Inc.