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 Wed Mar 27, 2019
nol Resources Corp. Provides Update To Previously Announced Reverse Take-Over

 
NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR RELEASE, PUBLICATION, DISTRIBUTION OR DISSEMINATION DIRECTLY, OR INDIRECTLY, IN WHOLE OR IN PART, IN OR INTO THE UNITED STATES.

VANCOUVER, BRITISH COLUMBIA -- March 27, 2019 -- Knol Resources Corp. (NEX: NOL.H) ("Knol") is pleased to provide the following update with respect to its previously announced agreement to complete a reverse take-over with Freckle I.O.T Ltd. ("Freckle" or the "Company"), a global leader in multi-touch, offline advertising attribution. The reverse take-over will be structured as a three-cornered amalgamation (the "Transaction") under the Business Corporations Act (Ontario).

The Transaction

Once the Transaction closes, Freckle will become a wholly-owned subsidiary of Knol and it is intended that Knol will change its name to "Freckle Ltd." or such other similar name to be determined by the parties (the "Resulting Issuer"). It is further intended that Knol will consolidate its common shares on a 2.2:1 basis and Freckle will become a wholly-owned subsidiary of Knol and the sole business of Knol will be the current business of Freckle. The board of directors of Knol will be comprised of five persons, one nominated by Knol and four nominated by Freckle. The security holders of Freckle will receive securities of Knol and the common shares of the Resulting Issuer (the "Resulting Issuer Shares") will be listed on the TSX Venture Exchange (the "TSXV") as a Tier 1 or Tier 2 issuer. Current shareholders of Knol are expected to own approximately 12% of the Resulting Issuer assuming completion of the concurrent Offering (as hereinafter defined). The Transaction will constitute a reverse takeover transaction pursuant to Policy 5.2 Change of Business and Reverse Takeovers (the "RTO Policy") of the TSXV.

The completion of the Transaction will constitute a "Reactivation" for Knol as a company listed on the NEX Board of the TSXV, and will be subject to the RTO Policy. The completion of the Transaction will be conditional upon the approval of the TSXV, entering into a business combination agreement, completion of the Offering and receipt of shareholder approval of Freckle. In accordance with the RTO Policy, because (i) Knol is an inactive issuer listed on the NEX, (ii) Knol is not subject to a cease trade order and will not be suspended from trading upon completion of the Transaction, and (iii) the Transaction is an arms-length transaction, the Transaction will not be subject to the approval of the Knol shareholders. Knol will seek shareholder approval for the proposed share consolidation and name change at a general meeting to be held before closing of the Transaction. In accordance with the policies of the TSXV, Knol's shares are currently halted from trading and will remain halted until further notice.

Concurrent Financings of up to $6.5 Million

In connection with the Transaction, GMP Securities L.P. ("GMP") and PI Financial Corp. ("PI") have been appointed as co-lead agents (the "Co-Lead Agents"), together with Canaccord Genuity Corp. and Haywood Securities Inc. (together with the Co-Lead Agents collectively, the "Agents"), for and on behalf of Freckle, to sell, on a "best efforts" private placement basis, subscription receipts (each a "Subscription Receipt" and together, the "Subscription Receipts") of Freckle at a price of $0.20 per Subscription Receipt (the "Offering Price") anticipated to be up to $3.5 million (the "Freckle Offering"). In connection with the Freckle Offering, it is anticipated that Knol will issue $1.5 million of subscription receipts on the same terms and conditions as the Freckle Offering (the "Knol Offering").

In addition, it is further anticipated that Freckle will complete a private placement of 7,500,000 units (each a "Unit" and together, the "Units") at a price of $0.20 per Unit for gross proceeds of $1.5 million (the "Unit Private Placement"). Each Unit consists of one common share of Freckle and one common share purchase warrant (each a "Warrant" and together, the "Warrants"). Each Warrant shall be exercisable at a price of $0.30 for a period of 24 months from the date of issuance thereof. The proceeds of the Unit Private Placement will be immediately available to Freckle.

The Freckle Offering, the Knol Offering and the Unit Private Placement (collectively, the "Offering") will raise an aggregate of up to approximately $6.5 million.

The first tranche of the Offering is expected to close on or about March 28, 2019. The net proceeds from the Offering will be used to expand operations globally for the Freckle measurement product, and the Killi solution and for transaction costs, working capital and general corporate purposes.

As part of the Freckle Offering and Knol Offering, each Subscription Receipt will entitle the holder thereof to receive, without any further action on the part of the holder and for no additional consideration, one common share of either Freckle or Knol, as the case may be. Each Subscription Receipt shall be automatically exercised, without further action by the holder of such Subscription Receipt, and for no additional consideration, immediately prior to completion of the Transaction, for one common share of either Freckle or Knol, as the case may be, upon the satisfaction of the escrow release conditions (the "Escrow Release Conditions") set out in a subscription receipt agreement to be entered into among Freckle, the Co-Lead Agents and Computershare Trust Company of Canada (the "Escrow Agent") (the "Freckle SR Agreement") and an additional subscription receipt agreement to be entered into among Knol, the Co-Lead Agents and the Escrow Agent (the "Knol SR Agreement"). The specific attributes of the Subscription Receipts will be set out in each of the Freckle SR Agreement and the Knol SR Agreement.

A cash commission of 7.0% (3.5% to certain president's list subscribers) of the gross proceeds from the Offering will be paid to the Agents (the "Agency Fee"). Fifty percent of the Agency Fee will be paid by the Company upon closing of the Offering with the balance (50%) paid to the Agents upon satisfaction of the Escrow Release Conditions and release of the proceeds from the Offering to the Resulting Issuer.

In addition, upon closing of the Offering, the Agents will be granted compensation options ("Compensation Options") equal to 7.0% (3.5% to certain president's list subscribers) of the number of Subscription Receipts issued. Vesting of the Compensation Options will be conditional upon satisfaction of the Escrow Release Conditions. Upon and conditional on the satisfaction of the Escrow Release Conditions, each Compensation Option will be exercisable for one Resulting Issuer Share (subject to customary adjustments) for a period of 24 months following the date of that the Escrow Release Conditions are met at an exercise price equal to the Offering Price.

About Freckle

With offices in Toronto and New York, Freckle helps leading brands measure the effectiveness of their advertising by independently matching media spend to in store visits while remaining media agnostic. Freckle works with the world's most prestigious brands, publishers and investment firms to deliver intelligence and validation of 1st party consumer data. Freckle's technology is used by Fortune 500 brands like McDonald's, Lexus, Walmart, General Motors, Verizon and AT&T and is a core component of the top demand side platforms and data management platforms used around the world.

In addition to its core business, Freckle developed a mobile application called "Killi" that allows consumers to take back control of their identity from those who have been using it without their consent. With Killi, consumers can opt in and select specific pieces of personal information that they would like to share with brands in exchange for compensation. Freckle's multi-channel offline attribution platform is now powered by the People of Killi, making it the most compliant, highest fidelity data source in the industry.

Pursuant to unaudited financial results as of December 31, 2018 prepared under IFRS by management of Freckle, Freckle earned $3,108,044 in revenue and had a net loss of $5,506,810. In addition, Freckle had $1,288,714 in assets and $9,441,302 in liabilities, of which $8,225,383 was a shareholder loan provided to Freckle by its founder Neil Sweeney that converted into common shares of Freckle at $0.20 on February 28, 2019.

About Knol Resources Corp.

Knol Resources Corp. is a reporting issuer in British Columbia, Alberta and Ontario with shares listed on the NEX Board of the TSX Venture Exchange. As at December 31, 2018, Knol had 55,696,470 common shares outstanding, approximately $3.4 million in assets (principally cash and cash equivalents) and approximately $32,000 in liabilities.

Resulting Issuer Board of Directors and Management

Subject to applicable shareholder and TSXV approval, on completion of the proposed Transaction, the board of directors and the management team of the Resulting Issuer will be comprised of the below-listed individuals.

Neil Sweeney, MBA, Director, Chief Executive Officer, and Chairman (Age: 44)

Neil Sweeney is the Founder, Director, Chief Executive Officer, and Chairman of Freckle. Mr. Sweeney will dedicate 100% of his time to his role within the Resulting Issuer. Mr. Sweeney has extensive experience at the senior management level of startups and has been involved in several large startups and successful sales. In 2010, Mr. Sweeney founded Juice Mobile, a mobile technology and adverting firm, which was acquired by Yellow Pages in 2016. As the founder and former CEO of Juice Mobile, he was responsible for ushering in some of the most prolific brands and publishers into the mobile space. Prior to launching Juice Mobile, Mr. Sweeney was an owner in StreamTheWorld and was instrumental in building it into the world's first, and largest, in-stream programmatic audio platform prior to its sale in June 2010. Mr. Sweeney was named among Deloitte's Fast 50 for three years in a row and was a two-time Finalist for Ernst & Young's Entrepreneur of the Year. Mr. Sweeney holds an MBA from the University of Edinburgh.

Brad Marks, B.A., Senior Vice President Product (Age: 46)

Brad Marks was appointed Senior Vice President of Product of Freckle in 2018. Mr. Marks will devote 100% of his time to his current position. Prior to joining Freckle, he spent over 15 years in management positions for several startups, as well as large enterprises. Mr. Marks' experience includes leading Product and Engineering teams at ExtendMedia (acquired by Cisco), Asset Inc. (acquired by Davis and Henderson), Research in Motion, and Juice Mobile (acquired by YellowPages). Mr. Marks earned a Bachelor of Arts degree in Western Literature and Psychology from Western University in 1995.

Anthony Tsigourakos, B.S., Chief Revenue Officer (Age: 36)

Mr. Tsigourakos joined Freckle as Vice President of Sales when Freckle launched its operations in the U.S. in 2017. Mr. Tsigourakos will devote 100% of his time to his position as Chief Revenue Officer of the Resulting Issuer. He has over 15 years of experience selling advertising products to agencies and direct brands, with a strong track record of bringing startups to market. Prior to joining Freckle, Mr. Tsigourakos was the VP of Sales, North America at AdParlor, a global advertising firm specializing in selling custom advertising solutions to clients across Facebook, YouTube, Twitter, Pinterest, and Snapchat. Mr. Tsigourakos was the first employee of a boot-strapped startup (TriVu Media) that was acquired by AdParlor in 2014. He got his first taste of startup acquisition during his time as Executive Sales Director at BLiNQ Media, an Atlanta-based startup specializing in Facebook advertising that was acquired by Gannett in 2012. Mr. Tsigourakos completed his Bachelor of Science degree in Sport Management from Rutgers University in 2004.

Sean Homuth, CPA, CA Chief Financial Officer (Age: 41)

Mr. Homuth is Chief Financial Officer of Freckle, bringing extensive experience with both Canadian and US publicly traded organizations both in industry as well as from a client perspective during his tenure at Ernst & Young and, more recently, as an independent consultant. Previously, Mr. Homuth was Chief Financial Officer at Orezone Gold Corporation (and Vice President Finance & Administration for its predecessor company, Orezone Resources Inc.). At Orezone Mr. Homuth led a global team of finance professionals and was involved in over C$800M in financings and M&A transactions with the company and its predecessor. Subsequent to Orezone, Mr. Homuth served as Chief Accounting Officer for the Royal Canadian Mint. Mr. Homuth holds accounting designations in both Canada (CPA, CA) and the United States (CPA -- Illinois).

Robert Fernicola, Msc, Director (Age: 41)

Mr. Fernicola is a Director of Freckle. After graduating from the University of Toronto with distinction, he began articling at Ernst and Young, working in audit and assurance. During his time at Ernst and Young, he obtained his CA (CPA). Mr. Fernicola decided to leave in order to further his academic interests at the London School of Economics where he earned a Master's of Science in International Accounting and Finance and graduated with merit. Shortly after, he returned to Ernst and Young and joined their Mergers and Acquisitions Due Diligence service line, where shortly thereafter, he became a senior manager. He was involved in audit and assurance engagements in addition to multiple mergers and acquisitions of public companies. In 2005, Mr. Fernicola left his role as Senior Manager at Ernst and Young to pursue a career in real estate development. In 2012, he founded his own development and management company, Carringwood Developments. Mr. Fernicola recently completed a 53-unit residential development in Vaughan and is currently developing a 14-unit estate project in Caledon. Mr. Fernicola is a successful entrepreneur and highly educated individual. With his professional credentials and broad experience, Mr. Fernicola will bring a unique perspective to Freckle. Additionally, Mr. Fernicola has experience sitting on the board of a public company.

John Farlinger, CA, Director (Age: 60)

Mr. Farlinger is a veteran technology executive and entrepreneur, and brings more than 20 years of experience in telecom, operations, technology and finance. Mr. Farlinger has held the position of interim CEO and Executive Chairman of Assure Holdings Corp. since June 1, 2018. Mr. Farlinger's prior experience includes, among other things, being the CEO of Urban Communications from July 2014 to June 2018, Senior Vice-President of Teliphone Navigata-Westel from February 2013 to April 2014, CEO of Titan Communications/Galaxy Multimedia Inc. from 2009 to February 2013, and CEO and President of Silicon Valley based Adzilla Inc. from 2004 until 2009. He is a Chartered Accountant and member of the Institute of Chartered Accountants of Ontario.

Kevin Shea, B.A, Director (Age: 61)

Mr. Shea has extensive experience in the technology industry and brings invaluable insight to Freckle. Mr. Shea has held the positions of President of YTV, President of Atlantic Communications, President of Global Television Network and President of Sirius Satellite Radio Canada. As President of Sirius Satellite Radio Canada, Mr. Shea's role was, among other things, to attain the CRTC licence, which he accomplished. In 2006, former Premier of Ontario, Dalton McGuinty, appointed Mr. Shea to Chair of the Ontario Media Development Council for a 3-year term. Mr. Shea was then reappointed for two additional terms and held that role until 2015. Mr. Shea has sat on numerous technology boards, as both an advisor and director. He is currently an advisor to Infuicity.com and to Slate Entertainment Group, a crypto-block chain company. He also serves as the Chairman of ChezShea Communications, a role he has had for the last decade. He is continually retained by companies to provide advice in marketing, strategy and government relations.

Michael Atkinson, B.A., Director (Age: 46)

Mr. Atkinson is the current CEO and a director of Knol, and is President and CEO of Earlston Investments Corp. Earlston is a well-capitalized merchant bank with a focus on providing debt to the real estate and resource sectors. He has over twenty years of expertise in the investment and venture capital industry. Previously Mr. Atkinson was Vice President of Quest Capital Corp. (TSX:QC), a company he helped start, where he was responsible for corporate communication and bridge lending activities. Within a five year period at Quest he was instrumental in expanding Quest's market cap from $30M to over $450M. As a member of the Credit Committee at Quest, the committee funded over $1 billion in loans during his tenure. Mr. Atkinson's understanding of the structuring of investments and project financing is a key asset in investment and mergers and acquisition efforts. Mr. Atkinson sits on various boards of directors in a diverse group of industries and holds a Bachelor of Arts degree from University of Western Ontario.

Sponsorship

Sponsorship of the proposed Transaction may be required by the TSXV unless an exemption or waiver from this requirement can be obtained in accordance with the policies of the TSXV. Knol intends to apply for a waiver of the sponsorship requirement; however, there is no assurance that a waiver from this requirement can or will be obtained.

In accordance with TSXV policy, the Knol's shares are currently halted from trading. Trading will resume upon a successful closing of the Transaction.

All information contained in this news release with respect to Freckle was supplied by Freckle for inclusion herein, and Knol and its directors and officers have relied on Freckle for any such information.

Completion of this transaction is subject to a number of conditions, including but not limited to, TSXV acceptance and if applicable pursuant to TSXV requirements, majority of the minority 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.

Investors are cautioned that, except as disclosed in the Filing Statement or Management Information Circular 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 Knol should be considered highly speculative.

The TSXV has in no way passed upon the merits of the proposed transaction and has neither approved nor disapproved the contents of this news release.


FOR FURTHER INFORMATION PLEASE CONTACT:
Michael Atkinson

President & CEO
(604) 689-1428

Neither the TSXV nor its Regulation Services Provider (as that term is defined in the policies of the TSXV) accepts responsibility for the adequacy or accuracy of this release.

The securities of Knol have not been and will not be registered under the United States Securities Act of 1933, as amended and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirement. This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any jurisdiction in which such offer, solicitation or sale would be unlawful.


CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION: This news release includes certain "forward-looking statements" under applicable Canadian securities legislation. Forward-looking statements include, but are not limited to, statements with respect to: the terms and conditions of the proposed transaction and the business and operations of the Resulting Issuer after the proposed transaction. Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable, are subject to known and unknown risks, uncertainties, and other factors which may cause the actual results and future events to differ materially from those expressed or implied by such forward-looking statements. Such factors include, but are not limited to: general business, economic, competitive, political and social uncertainties; delay or failure to receive board, shareholder or regulatory approvals. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements. Knol disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.
 
 

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