Mr. Paul Ciullo reports
HASHCHAIN TECHNOLOGY INC. ANNOUNCES CORPORATE UPDATE
Hashchain Technology Inc. has provided a corporate update in respect of its strategy to vertically integrate the company's operations with the hosting services currently provided to the company by Bit.Management LLC by way of its previously announced reverse takeover transaction with Digihost International Inc., previously disclosed in the company's press releases of
March 28, 2019, April 26, 2019, June 7, 2019, July 29, 2019, Sept. 11, 2019, Nov. 29, 2019, and Dec. 9, 2019.
proposed transaction and matters related thereon will be submitted to shareholders of the company at an annual general and special meeting of its shareholders.
The upcoming meeting will be held on Jan. 14, 2020, at 10 a.m. at the offices of Peterson McVicar LLP, located at Suite 902, 18 King Street E., Toronto, Ont. A copy of the management information circular which explains the terms of the proposed transaction is available under the company's profile on SEDAR.
Management of the company anticipates that the completion of the proposed transaction would provide a number of benefits to HashChain, including:
Reduced costs of cryptocurrency mining through the vertical integration of HashChain's operations and the termination of the hosting services agreement with Bit.Management, LLC, who the company currently pays for rent
for the physical space of its rigs and for the electricity used in its cryptocurrency operations;
- Release from accrued liabilities owing to Bit.Management LLC pursuant to the hosting services agreement;
Increased access to capital as a result of the minimum $5.4-million concurrent financing of Digihost to be completed prior to completion of the proposed transaction.
"The proposed transaction with Digihost International provides a great opportunity for the company to reduce its cost of mining and deploy capital to acquire new miners to expand the business. We are very excited by what Michel Amar and the rest of the Digihost team bring to the table and look forward to the company's future," said Patrick Gray, chief executive officer of HashChain.
Upon completion of the proposed transaction, the mining operation will have 12,895 bitcoin mining rigs with the ability to expand to 17.5 megawatts of computing power with electricity at an average all-in
cost of five U.S. cents per kilowatt-hour. The operating facility is located in Buffalo, N.Y., with over 70,000 square feet under a five-year lease and an option to lease additional facility space totalling 240,000 square feet after three years. HashChain will focus on validation through mining, hosting solutions and blockchain software solutions.
Conditions to completion of the proposed transaction and regulatory matters
Completion of the proposed transaction is subject to a number of conditions, including but not limited to, exchange acceptance and if applicable, disinterested shareholder approval. Where applicable, the transaction cannot close until the required shareholder approval is obtained. There can be no assurance that the transaction will be completed as proposed or at all.
We seek Safe Harbor.
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