Match Capital Resources Corporation Enters Into Letter of Intent With Braingrid Corporation

Toronto, Ontario--(Newsfile Corp. - June 6, 2018) - Match Capital Resources Corporation (TSXV: MHC.H) ("Match") is pleased to announce that it has entered into a letter of intent dated June 4, 2018 (the "LOI"), with Braingrid Corporation ("Braingrid"), a private precision agriculture company focused on the cannabis sector, to acquire all the issued and outstanding securities of Braingrid (the "Transaction").

The Transaction is subject to TSX Venture Exchange ("TSXV") approval and applicable shareholder and regulatory approvals as set forth in more detail below. It is intended that the Transaction will be completed by way of a three-cornered amalgamation of Braingrid, Match and a wholly owned subsidiary of Match ("Match Subco") to form a new company ("Amalco"), provided however that, by mutual agreement, the parties may revise the structure to comply with all necessary legal and regulatory requirements, to minimize or eliminate any adverse tax consequences or to increase cost-effectiveness. The Transaction is intended to result in a reverse take-over of Match by Braingrid's shareholders.

Terms of the Agreement

Subject to the satisfaction of the conditions to closing, on or prior to the closing of the Transaction (the "Closing Date"), Match Subco will amalgamate with Braingrid to form Amalco and Match will issue post-consolidated common shares of Match to the shareholders of Braingrid, in consideration for the transfer of their Braingrid common shares to Match, on the basis that each common share held by shareholders of Braingrid will be exchanged for two (2) post-consolidation common shares of Match resulting in Amalco becoming a wholly owned subsidiary of Match. The Transaction will be an arm's length transaction for Match.

Upon the closing of the Transaction, Match will be renamed Braingrid Limited or such other name as the parties agree to.

Match and Braingrid have agreed to use all commercially reasonable efforts to close the Transaction prior to Sept. 10, 2018. The LOI will terminate in the event the parties fail to enter into a definitive amalgamation agreement on or prior to June 22, 2018, unless a later date is otherwise mutually agreed to by the parties.

Capitalization

As of the date hereof, Match has 8,615,445 common shares issued and outstanding and a maximum of $365,000 of accounts payable, accrued liabilities and amounts due to shareholders, of which approximately $345,000 will be converted into common shares of Match at a post-Transaction value of $0.40 per share, subject to regulatory approval. Under the terms of the LOI, Match will consolidate all of its issued and outstanding securities on a one (1) for eight (8) basis (or such other ratio as may be required by TSXV policies) and convert its outstanding debt into equity at a post-consolidation share price of $0.40 per Match common share, subject to receipt of required regulatory and shareholder approval. Prior to the closing of the Transaction, subsequent to the consolidation and debt conversion, Match will have no more than 2,000,000 post-consolidation shares outstanding on a fully diluted basis, excluding shares and warrants issued in connection with the Financing (as defined below).

Prior to the closing of the Transaction, Braingrid will have no more than 32,000,000 shares outstanding on a fully diluted basis, excluding shares and warrants issued in connection with the Financing.

Assuming $3,000,000 is raised pursuant to the Financing, on a post-Transaction basis Match will have 48,851,357 common shares issued and outstanding on an undiluted basis and 72,497,096 on a fully diluted basis. The existing shareholders of Braingrid will hold approximately 73.24 percent of the issued and outstanding fully diluted consolidated common shares of the resulting issuer; Match shareholders will own approximately 2.68 percent of the issued and outstanding fully diluted consolidated common shares of the resulting issuer; Braingrid's advisors pursuant to the Transaction, 514 Financial Inc. and Harris Capital Corp., will own approximately 2.56 percent of the issued and outstanding fully diluted consolidated common shares of the resulting issuer; finders will own approximately 0.82 percent of the issued and outstanding fully diluted consolidated common shares of the resulting issuer; and investors in the Financing will own approximately 20.70 percent of the issued and outstanding fully diluted consolidated common shares of the resulting issuer.

Conditions of Closing

The closing of the Transaction is subject to several conditions including, among other things: (i) receipt of all regulatory approvals, including that of the TSXV; (ii) requisite corporate approval of the various transactions contemplated by the Transaction from the directors and shareholders of Match and Braingrid, as applicable; (iii) closing of the Financing, as described below; and (iv) approval by the security holders of Match of the proposed name change, the consolidation of its outstanding shares on a one (1) for eight (8) basis, the shares for debt settlement terms and the share issuances to the shareholders of Braingrid, specifically the deemed price at which such debt will be settled and shares will be issued being $0.40 per share on a post-consolidation basis.

Financing

Prior to the closing of the Transaction, Braingrid is required to have completed a non-brokered private placement to raise gross proceeds of up to $3,000,000 at a price of $0.80 per security (the "Financing"). The Financing will consist of a private placement of Units of Braingrid (a "Unit"), each Unit consisting of one common share of Braingrid (a "Common Share") and one Common Share purchase warrant (a "Warrant"), each Warrant entitling the holder to purchase one Common Share at a price of $1.00 per share (the "Exercise Price") for a period of 24 months from the closing date of the Financing. The proceeds of the Financing will be used to fund capital expenditures, mergers & acquisitions, working capital and general corporate purposes.

In connection with the Financing, certain finders, including EMD Financial Inc., will receive a cash commission of eight (8) percent of the gross proceeds of the Financing, warrants entitling the finder to purchase that number of common shares of Braingrid as is equal to four (4) percent of the number of Units of Braingrid issued to purchasers introduced to Braingrid by the finder under the Financing, exercisable at a price of $1.00, for a period of twenty-four (24) months from the Closing of the Financing. The finder will also receive a number of common shares of Braingrid equal to four (4) percent of the number of Units issued to purchasers introduced to Braingrid by the finder under the Financing.

Business of Braingrid

Braingrid is a Canadian-controlled private corporation based in Toronto, Ontario. It was incorporated federally in Canada in 2012. 

Braingrid is a precision agriculture technology company that provides an affordable, versatile and quick-to-install global sensor platform that captures the critical real-time data needed by licensed cannabis producers to increase revenues, reduce costs and reduce risks.

Braingrid has commercialized a proprietary device called the "Sentroller," which in the case of cannabis, is installed in licensed medical cannabis facilities. These Sentrollers connect to sensors, which measure environmental conditions such as temperature, humidity and CO2. This data is communicated wirelessly to a Braingrid gateway in the facility, which in turn sends the data via cellular modem to internet-based servers. This data can then be accessed by customers via online dashboards and reports. In addition, the platform can send email alarms to the customer when out-of-bounds conditions are sensed.

The Company has business agreements with Ample Organics Inc., WeedMD Inc., Beleave Kannabis Corp. and R2G Global LLC to develop and deploy its technology.

For the 12-month period ending March 31, 2018, Braingrid had net sales of approximately $157,000 (unaudited) and a net loss of approximately $667,000 (unaudited). As at March 31, 2018, Braingrid had total assets of approximately $1.8 million (unaudited), including cash of approximately $1.6 million (unaudited) and shareholders' equity of approximately $1.7 million (unaudited).

The major shareholders of Braingrid are its founder Mr. Michael Kadonoff of Toronto, Ontario, who holds 27 percent indirectly of Braingrid's current issued and outstanding common shares, and Mr. Kenneth Kadonoff of Toronto, Ontario, who owns 27 percent directly and indirectly of Braingrid's current issued and outstanding common shares.

The Resulting Issuer

Match and Braingrid have agreed that upon the closing date, the board of directors of the resulting issuer shall consist of five (5) directors to be appointed by Braingrid. Such appointments are subject to the approval of the TSXV. The names and backgrounds of each of these persons will be published in a later press release.

Management of the Resulting Issuer After the Qualifying Transaction

It is expected that management of the Resulting Issuer will be as follows:

Michael Kadonoff, Founder, Chief Executive Officer

Prior to founding Braingrid in 2012, Michael Kadonoff worked as a professional hardware designer at GE Grid IQ on the premier design team for energy grid automation and control products. Michael is an avid inventor and a passionate energy reform visionary. Michael has a B.Eng from McMaster University and a Technologist Diploma in Electrical and Electronics Engineering from Lakehead University.

Matthew Skynner, President & Chief Operating Officer

Matt Skynner has over 25 years of high-tech experience, including leading a global, $1 billion technology business as corporate vice president and general manager at AMD. Matt spent 17 years in various roles at AMD (previously ATI) including vice president, corporate marketing; vice president, product marketing; and corporate vice president and general manager of the graphics business unit. Matt gained deep experience with sensing, control and automation systems during his 10-year tenure at Honeywell Limited. He has also served on the board of directors of the IT Association of Canada. Matt is a professional engineer and holds a Bachelor of Science in electrical engineering and an MBA from the University of Manitoba. 

Kenneth Kadonoff, Executive Chairman

Ken Kadonoff is a nimble, hands-on leader in business development, problem-solving, legal work and interim management in a variety of industries. Mr. Kadonoff practiced commercial law with top Toronto law firms since 1978, then transitioned to COO for a TSX-listed company, and was vice-chairman of the Canadian Franchise Association. He has deep established network relationships, business and legal experience across many industries. Mr. Kadonoff holds a B. Comm. from Concordia University (Mtl.) and B.C.L and LL.B. degrees from McGill University (Mtl.). 

Doug Harris, Chief Financial Officer

Doug Harris is a chartered accountant and a chartered business valuator with over 20 years of experience in the financial services sector, including accounting, operations, corporate finance, equity research, private equity and mergers and acquisitions. Mr. Harris has a BSc. in Physical Geography from the University of Guelph and an MBA (Accg) from the University of Toronto - Rotman School of Management.

Sponsorship and Valuation

A sponsorship and valuation may be required by the TSXV in connection with the Transaction unless exemptions from the sponsorship and valuation requirements are available. Match intends to apply for an exemption from the sponsorship and valuation requirements. There is no assurance that Match will be able to obtain such an exemption.

Trading Halt

Match's common shares are currently halted and Match anticipates they will remain halted until the completion of the Transaction.

MATCH CAPITAL RESOURCES CORPORATION

Nadim Wakeam
Director
Telephone: (416) 593-2980

Completion of the Transaction is subject to a number of conditions, including TSX Venture Exchange acceptance, and if applicable, disinterested shareholder approval. The Transaction cannot close until the required shareholder approvals are obtained. There can be no assurance that the Transaction will be completed as proposed or at all.

Investors are cautioned that, except as disclosed in the disclosure documentation to be 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 Match should be considered highly speculative.

The TSX Venture Exchange has in no way passed upon the merits of the proposed Transaction and has neither approved or disapproved the contents of this press release.

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