Mr. Young Ko reports

ADAGIO CAPITAL INC ANNOUNCES DEFINITIVE AGREEMENT FOR THE ACQUISITION OF ADVANCED GRAPH ENTERPRISE DATABASE INC.

Further to its news releases dated June 1, 2023, and Aug. 30, 2023, Adagio Capital Inc., 1441651 B.C. Ltd., a newly incorporated wholly owned subsidiary of Adagio (NewCo), and Advanced Graph Enterprise Database Inc. (AGEDB), a private arm's-length British Columbia company, have entered into an amalgamation agreement dated Oct. 5, 2023, pursuant to which Adagio will acquire all of the issued and outstanding securities of AGEDB.

The transaction is subject to the approval of the TSX Venture Exchange, and is intended to constitute Adagio's qualifying transaction (as defined in Policy 2.4). The combined company that will result from the completion of the transaction (thereafter referred to as the resulting issuer) will be renamed AGEDB Technology Ltd. or such other name as agreed to by Adagio and AGEDB. Subject to TSX-V approval, the common shares of the resulting issuer will trade on the TSX-V, under the symbol AGET, and the business of the resulting issuer will be the business of AGEDB. It is expected that the resulting issuer will be listed on the TSX-V as a Tier 2 technology issuer.

About Advanced Graph Enterprise Database Inc.

AGEDB is a Vancouver-based private company with a primary focus on developing and delivering cutting-edge graph database management system (DBMS) software and technology. AGEDB's innovative approach allows for graph data processing on graph DBMS, a unique feature not available in the market until now. AGEDB aims to empower users of relational DBMS with enhanced analysis capabilities, enabling them to uncover valuable insights from the connections and relationships between data points. The management team of AGEDB comprises individuals with extensive experience in the graph database market.

AGEDB possesses the core technologies of Apache AGE, one of the biggest and most influential open-source graph database projects in the world. AGEDB is a subsidiary of Bitnine Global Inc., which is a wholly owed subsidiary of Bitnine Co. Ltd., the leading provider of graph database management systems in Korea. AGEDB and Bitnine Global have entered into a licensing agreement for the use of three intellectual property (IP) patents owned by Bitnine Global that AGEDB can use in software development as well as providing for exclusive global distributions rights (excluding Korea) for any software products developed and derived from the three IP patents.

Summary of the transaction

Pursuant to the terms of the amalgamation agreement, Adagio will acquire all of the issued and outstanding common shares and Class A common shares in the capital of AGEDB by way of a three-cornered amalgamation whereby NewCo and AGEDB will amalgamate to form a new amalgamated entity (AmalCo), and Amalco will be a wholly owned subsidiary of Adagio. At the time of closing of the transaction, each of the outstanding AGEDB shares will be cancelled and, in consideration for such AGEDB shares, each holder of AGEDB shares will receive four postconsolidation (as defined below) common shares in the capital of Adagio at a deemed price of 50 cents per Adagio share for each one AGEDB share held by such AGEDB shareholder. Adagio expects to issue an aggregate of 30,052,000 Adagio shares (on a postconsolidation (as defined below) basis) for the AGEDB common shares issued and outstanding immediately prior to the completion of the concurrent financing (as defined below), 10 million Adagio shares (on a postconsolidation basis) for the AGEDB Class A common shares issued in the concurrent financing, and 100,000 Adagio shares (on a postconsolidation basis) in connection with the payment of an advisory acquisition fee. In addition, Adagio expects to exchange 731,250 incentive stock options to acquire 731,250 Adagio shares for 731,250 outstanding incentive stock options to acquire 731,250 AGEDB shares.

Share consolidation

Prior to completion of the transaction, Adagio will seek to consolidate its outstanding Adagio shares on the basis of 2.50 preonsolidation Adagio shares for every one postconsolidation Adagio share.

Concurrent financing

In connection with the transaction, it is anticipated that AGEDB will complete a non-brokered private placement financing of 2.5 million AGEDB Class A common shares at a price of $2 per AGEDB Class A common share and 13,000 AGEDBcommon shares at a price of $2 per AGEDB common share to raise aggregate gross proceeds of $5,026,000. No finder's fees, cash commissions and/or broker warrants are expected to be paid and/or issued in relation to the concurrent financing.

The proceeds from the concurrent financing are intended to be used to pursue the business goals and objectives of the resulting issuer as well as for its general working capital purposes. Further information on the resulting issuer's business goals and objectives will be provided in the filing statement to be filed with the TSX-V in connection with the transaction.

Corporate advisory fee

In connection with the transaction, the parties agreed that on closing and subject to approval of the TSX-V, an arm's-length corporate adviser will be paid a merger and acquisition advisory fee of 100,000 resulting issuer shares and $150,000 in cash. No other fees will be paid.

Closing of the transaction

The completion of the transaction is subject to the satisfaction of various conditions as are standard for a transaction of this nature, including but not limited to: (i) the company having had the reasonable opportunity to perform searches and other due diligence, and being satisfied with the results of such due diligence; (ii) receipt of all requisite consents, waivers and approvals for the transaction, including the approval of the TSX-V; (iii) the absence of any material adverse change in the business, affairs or operations of Adagio or AGEDB; (iv) completion of the concurrent financing; and (v) AGEDB having received the requisite approvals from its shareholders in order to complete the transaction.

Assuming the completion of the transaction, the concurrent financing and that no convertible securities of Adagio are exercised, 42,152,000 resulting issuer shares are expected to be issued and outstanding on the date of closing of which approximately 4.74 per cent of the resulting issuer shares are anticipated to be held by the current shareholders of the company, approximately 71.17 per cent are anticipated to be held by the AGEDB shareholders, approximately 23.85 per cent will be held by the subscribers to the concurrent financing and approximately 0.24 per cent will be held by the adviser.

The transaction is an arm's-length transaction and therefore will not require shareholder approval under Policy 2.4.

Directors, officers and insiders of the resulting issuer

Following the closing, it is expected that the following individuals will be appointed as management of the resulting issuer:

Cheolsun Kang, chairman and director

Mr. Kang is the founder and chief executive officer of Bitnine and Bitnine Global. Prior to founding Bitnine in 2013, Mr. Kang worked as a technology engineer at LG CNS Co. in Korea for three years and then transitioned into a sales and presales consultant at International Business Machines (IBM) in Korea. Mr. Kang graduated from Seaoul National University with a bachelor's degree in computer engineering. Mr. Kang has over eight years experience as a global service sales lead and presales consultant at IBM, and has acquired in-depth business and technical database knowledge from managing the database projects at IBM.

Young Seung Ko, chief executive officer and director

Mr. Ko is a seasoned information technology (IT) professional with around 20 years of experience in IT. Mr. Ko spent six years as a software developer and data modelling software engineer at CA Technologies and 10 years as a technology consultant for databases, application server and mainframe rehosting software products. Before being appointed as the CEO of AGEDB, Mr. Ko was managing Bitnine Global's business development and research and development operations in collaboration with Bitnine. Mr. Ko is in charge of AGEDB's Apache AGE community development and software marketing and technical sales initiatives. Mr. Ko is also leading the AGEDB's global technical human resource infrastructure, helping AGEDB set up R&D centers around the world.

Mickey Goldstein, chief financial officer and corporate secretary

Ms. Goldstein specializes in financial reporting, and provides CFO services to public and private companies in Canada. Ms. Goldstein has over 15 years of experience working with public companies across many industries. Prior to offering CFO services, Ms. Goldstein had a successful career as an assurance partner in a Vancouver public accounting firm where she provided accounting, audit, assurance and business advisory services to both private and public companies and not-for-profit organizations. Throughout her career Ms. Goldstein has specialized in mining, technology, cannabis, manufacturing, real estate and medical industries. She has a keen understanding of public company operations, restructurings, acquisitions and initial public offerings and has in-depth experience providing transactional services to companies in Canada and United States. Ms. Goldstein currently serves as the CFO of a Canadian publicly listed company, CFO of a number of Canadian private companies and treasurer on the board of directors of a non-profit company.

Ms. Goldstein graduated from the University of British Columbia with a bachelor of science degree in mathematics, and went on to obtain her CA, CPA.

Eya Badal Abdisho, chief technology officer

Ms. Abdisho has extensive experience in information technology engineering for over 10 years. At Bitnine Global, she was the lead product manager and software architect for several open-source and commercial graph DBMS software offerings. Prior to her current role, she worked as a technical and software engineer in various companies, leading development projects and providing technical support and expertise. Ms. Abdisho's proficiency includes using technologies like Cypher, SQL, AWS, Google Cloud, PostgreSQL, Java, C, C++, HTML, CSS, JavaScript, Python, Unity, Node.js, Express, Linux, JDBC, Docker and Swift. As the chair for the Apache AGE project, Ms. Abdisho also facilitates co-ordination among a diverse team of contributors, implements project governance policies and promotes an open, meritocratic culture.

Ms. Abdisho is also currently a PhD student in computer science and engineering at the University of California, Santa Cruz, with a master of science in software engineering from San Jose State University and a bachelor of science in software engineering from San Jose State University, while also being a member of the Engineering Honor Society and the Society of Women Engineers.

Changhak Lee, chief operating officer

Mr. Lee has over 20 years of experience in the engineering and construction industry, with a strong focus on business operations, staff management and risk mitigation. He has held key roles in various large-scale projects across different countries, including quality control manager, project development manager, and engineering manager and process lead engineer, showcasing his versatile expertise. Currently, Mr. Lee is the president of Datametrex Electric Vehicle Solutions Inc. and oversees market analysis, business model formulation, marketing, sales strategy and operational benchmarks for the electric vehicle sector.

Mr. Lee holds a master's degree in water treatment and control from Hanyang University in Seoul, Korea, providing him with a solid foundation in water treatment technologies and processes. Additionally, he is an APMG certified PPP professional since 2012.

Christopher Cherry, director

Mr. Cherry is a highly accomplished professional with an extensive background in accounting and finance, spanning over 20 years. His career commenced at KPMG LLP, where he began as a staff accountant and swiftly advanced to the position of senior accountant, focusing on owner-managed businesses and the Canadian tax group. At Davidson & Company LLP, he excelled as a senior auditor, specializing in conducting IPO audits for companies seeking listings on the TSX-V. Building on this experience, he embarked on a new journey by joining iO Corporate Services Ltd. as a corporate controller and since 2008, Mr. Cherry has held prominent positions as a director and/or CFO in various companies across diverse industries, ranging from technology to mining, showcasing his versatility and exceptional acumen in both accounting and corporate leadership roles.

Zara Kanji, director

Ms. Kanji is the founder of Zara Kanji & Associates, CPA, established in 2004. Ms. Kanji is experienced in financial reporting compliance for junior listed companies, taxation, general accounting, financial reporting and advisory services for individuals and private and public companies. In addition to providing business advisory and compliance services to private and public entities, Ms. Kanji has served as director and officer for several listed issuers and has been part of teams that have facilitated several financings and acquisition transactions. Ms. Kanji is passionate about financial literacy and regularly provides presentations for entrepreneurs, start-ups, women's groups and new Canadians.

Ms. Kanji is a member of the Chartered Professional Accountants of BC and Canada and previously the Certified General Accountants Association since August, 2003. Ms. Kanji holds abachelor of technology in accounting (honours) and a diploma in corporate finance (honours) from the British Columbia Institute of Technology.

Following the closing, it is expected that each of Mr. Kang, Bitnine Global and Graphizer Inc., a California corporation, will hold, both directly and indirectly, more than 10 per cent of the resulting issuer shares issued and outstanding and that Jeremy Wright will hold an aggregate of 201,667 resulting issuer shares. In addition, Mr. Kang, the proposed chairman and a director of the resulting issuer, is the chief executive officer and founder of Bitnine and Bitnine Global as well as chief executive office of Graphizer. Andrew Ko, the proposed CEO and a director of the resulting issuer, is secretary of Graphizer. Each of Bitnine Global and Graphizer are controlled by Mr. Kang.

Additional information on the proposed directors, officers and insiders (as defined in the policies of the TSX-V) of the resulting issuer will be included in a subsequent press release.

Financial information of AGEDB

A summary of the audited financial information of AGEDB for the period from incorporation on Sept. 12, 2022, to April 30, 2023, disclosed in accordance with TSX-V policies, is included in the table below:

PERIOD FROM INCORPORATION ON SEPT. 12, 2022, TO APRIL 30, 2023 (AUDITED) ($)
 

Total revenues:                            2,091,787
Total assets:                              1,520,380
Total liabilities:                           888,686
Basic and diluted loss per share:         (72 cents)
Total expenses:                            1,717,343
Net loss and comprehensive (loss):       (1,880,618)
                      

Additional financial information with respect to AGEDB will be provided in the filing statement to be filed with the TSX-V in connection with the transaction.

Sponsorship

Sponsorship of a qualifying transaction of a capital pool company is required by the TSX-V unless an exemption from the sponsorship requirement is available. Adagio intends to apply for a waiver from the sponsorship requirements. There is no assurance that the company will be able to obtain such a waiver.

About Adagio Capital Inc.

Adagio is a British Columbia-based company and a reporting issuer in the provinces of British Columbia and Alberta. Adagio focuses on strategic investments in high-growth sectors, aiming to create long-term value for its shareholders.

We seek Safe Harbor.