Blockchain Mining Ltd. Calls an Extraordinary General Meeting to be Held on Feb 19, 2018 for Shareholder Approval of Transaction
Blockchain Mining Ltd. Provides Unaudited Financial Summary of Bitfarms Operations
Blockchain Mining Ltd. Provides General Update and Capital Markets Strategy
TEL AVIV, Israel and MONTREAL, Jan. 14, 2018 (GLOBE NEWSWIRE) — Blockchain Mining Ltd. (â€œBLCMâ€� or a â€œCompanyâ€�) (TASE:BLCM) (OTC:NRHYY) is gratified to announce that it has executed a Definitive Agreement with Backbone Hosting Solutions Inc., famous by a handling name â€œBitfarmsâ€�, for a merger of 100% of expelled and superb shares of Backbone formulating one of a worldâ€™s largest cryptocurrency mining companies by commissioned energy and crush power.
Backbone Hosting Solutions Inc. (â€œBitfarmsâ€�) owns and operates blockchain farms that energy a tellurian decentralized financial economy. Bitfarms provides computing energy to cryptocurrency networks such as bitcoin, bitcoin cash, ethereum, litecoin, and lurch earning fees from any network for securing and estimate sell 24/7. Since 2013, predecessors to Bitfarms have assembled 4 farms in Quebec, Canada that have 27.5 MW of commissioned ability and over 200 Ph/s of commissioned hash-power. Bitfarms construction tube includes an additional 3 farms with over 100 MW of energy capacity. The Company has been self-funded given a origination and has over 200 shareholders. For some-more information on Bitfarms, visit: www.bitfarms.io.
Pursuant to a Definitive Share Exchange agreement, BLCM will acquire 60.7% of a expelled and superb shares of Backbone in sell for 40,460,001 common shares of a BLCM.
Additionally, BLCM will introduce a successive share sell to Backbone minority shareholders pursuant to that BLCM will acquire a remaining 39.3% of a expelled and superb shares of Backbone from these minority investors in sell for 26,206,666 common shares of a BLCM.
In total, adult to 66,666,667 shares of BLCM shall be expelled to a shareholders of Backbone.
As during Jan 12, 2018, there were 16,614,924 BLCM common shares expelled and outstanding.
Assuming both phases of a transaction are completed, BLCM expects to have approximately 83,281,591 expelled and superb common shares on a entirely diluted basis. Approximately 20% of those shares will be hold by shareholders of BLCM today, and 80% will be hold by former shareholders of Backbone.
Closing Process and Timeline of Events
The transaction has been authorized by a house of directors of BLCM and Backbone and is now theme to shareholder capitulation in an Extraordinary General Meeting (â€œEGMâ€�) that will be hold during a law offices of Zitvar, Galor Co. during 7 Begin St. Ramat Gan on Feb 19, 2018. Mr. Roy Sebag, a largest shareholder of Blockchain Mining Ltd. with over 54% of a votes, has voiced his enterprise to opinion in preference of a transaction during a EGM.
Once a votes are expel and a elementary infancy is achieved, a transaction will be strictly sealed theme to prevalent shutting conditions.
Resulting Company Management and Board of Directors
Following shareholder capitulation during a EGM, BLCM will designate a following members as supervision and Board of Directors of a Company:
Nicolas Bonta â€“ Chairman of a Board of Directors
Pierre-Luc Quimper – President and Director
Emiliano Joel Grodzki – Chief Executive Officer and Director
Rodrigo Menendez – General Counsel and Director
Roy Sebag – Chief Investment Officer and Director
Tomer David – Independent Director
Joshua Hershkovici – Independent Director
Mathieu Vachon, Director of Software Engineering
Anthony Levesque â€“ VP of Operations
Louis Valois â€“ VP of Infrastructure
Full Biographies for any member of a Board of Directors can be noticed during a Companyâ€™s financier display during www.bitfarms.io.
Blockchain Mining Ltd. intends to change a name to: Bitfarms Ltd. on execution of a second proviso of a transaction (Minority Investor Share Exchange). As such, a ask has already been done to change a Companyâ€™s ADR Symbol from â€œNRHYYâ€� to â€œBITFYâ€�.
Backbone Hosting Solutions Inc. (Bitfarms) Auditor Appointment and Unaudited Financial Results
Blockchain Mining Ltd. is gratified to news that it has allocated Nexia Friedman, LLP in Montreal, that is an associate of a Companyâ€™s Israel Auditor Strauss Lazer Co., to finish a IFRS review for Backbone Hosting Solutions Inc. This routine has already been instituted and a audited total are coming to be total into Blockchain Mining Ltd.â€™s formula subsequent FY 2017.
Backbone was rigourously orderly as a Canadian house on Nov 6, 2017 as a outcome of a skill assignment of farms and record from a founders and minority investors. As such, all financial formula have been reported from this date onwards.
Operating Activity (in US Dollars)
Over a 56 day duration from Nov 6, 2017 to Dec 31, 2017, Backbone generated a following financial formula (unaudited):
Mining Revenueâ€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦.â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦.$ 10,611,968
Mining Operating Costsâ€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦.â€¦$ (899,866)
Net Mining Margin for a Periodâ€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦.â€¦â€¦..$ 9,712,102
Over this same period, Backbone generated a advantage of $1,937,218 on mined cryptocurrency coins that were hold for resale or long-term investment.
Operating Activity (Notes)
During this 56 day period, Backbone mined 587 Bitcoin (BTC), 1,337 Bitcoin Cash (BCH), 188 Dash (Dash), 4,023 Litecoin (LTC), and 385 Ethereum (ETH).
Over a final 7 days of operation in Dec 2017, Backbone averaged $266,171 in daily mining revenue. That daily income figure has grown to an normal of $297,192 in a initial 11 days of 2018, even in light of reduce mark prices for Bitcoin. This is in partial due to Backbone installing additional energy and hash-power by collateral reinvestment of handling cash-flow. Additionally, a enlargement in income can be attributed to Backboneâ€™s exclusive program that mines a many essential coins during any moment, concentrating a entirety of computational energy in all farms on a specific blockchain. As an example, given Dec 21, 2017, Backbone has been essentially mining Bitcoin Cash (BCC) that has resulted in aloft daily income total in USD even in light of a reduce mark cost for Bitcoin and other cryptocurrencies.
Unaudited Balance Sheet (in US Dollars) during Period Ended Dec 31, 2017
Cash during Banksâ€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦.â€¦..$ 7,518,903
Cryptocurrency Coins hold for Investment Purposesâ€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦.â€¦..$ 3,239,771
Property, Equipment, and Leasehold Improvementsâ€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦…â€¦$18,890,646
Intellectual Propertyâ€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦..â€¦…$Â 5,000,000
Total Assetsâ€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦..â€¦â€¦$ 34,649,320
Â Â Â Â Â Â Â Â Â Â Â
LiabilitiesÂ Â Â Â Â Â Â
Accounts Payable and Accrued Expensesâ€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦…………$ (300,000)
Long-term Lease Paymentsâ€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦..â€¦â€¦â€¦$ (1,000,000)
Â Â Â Â Â Â Â Â Â Â Â
Â Â Â Â Â Â Â Â Â Â Â
Shareholder Equityâ€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦â€¦..â€¦â€¦$ 33,349,320
Balance Sheet (Notes)
At year-end, a Backbone essentially hold Bitcoin Cash (BCH) on a change piece as Coins hold for investment purposes. Since Dec 31, 2017, Backboneâ€™s change piece has serve strengthened by mining revenue, giveaway money flow, and silver sales.
General Corporate Update and Capital Markets Strategy
With a Definitive Agreement executed and a shutting approaching, Backbone is now looking brazen towards a subsequent corporate and business enlargement goals. The primary concentration is in a construction of a plantation tube St. Hyacinthe, Magog, and a newly acquired skill with adult to 80MW of commissioned energy from Hydro-Quebec. The Company skeleton to fuel this enlargement from free-cash-flow or by potentially accessing collateral markets.
The Companyâ€™s financial advisors GMP Securities and PowerOne Capital Markets have hold rough discussions relating to a intensity Subscription Receipt Offering of Convertible Debt Securities of adult to $100 million CAD. The Company has also been in rough discussions with several institutional investors for off-take agreements on destiny silver prolongation for adult to $50 million CAD. Ultimately, it is a Companyâ€™s enterprise to accelerate collateral spending, and therefore enlargement in commissioned energy and hash-power usually if it can be achieved by minimal dilution to a common shareholders.
Currently, BLCM is an Israeli Corporation with a Ordinary shares listed on a Tel Aviv Stock Exchange underneath a symbol: â€œBLCMâ€�. The Company also maintains an American Depository Receipt Program (ADR) administered by Bank of New York Mellon (BNY) whereby ADRâ€™s representing dual (2) Ordinary shares are expelled by BNY and trade on a OTC Markets underneath a symbol: â€œNRHYYâ€�.
Recently, there have been discussions about proposing new law in Israel that would need a association intent in cryptocurrency business, to have during slightest 100 million NIS of shareholder equity and 3 years of audited financials.
Assuming a due law is not rejected, on a drift that it would foul need one attention within a economy to say aloft quantitative register standards than others (such as biotechnology or oil and gas exploration), it will approaching take several months or longer to accept recognition and contingency be sealed by a Finance Minister.
The Companyâ€™s position, after carrying reviewed a breeze proposal, is that we accommodate a due heightened quantitative standards set (100 million NIS) as a total change sheets of Backbone and BLCM (at 12/31/2017) will have closer to 140 million NIS of shareholder equity ($41 million USD). It is also a Companyâ€™s position that a three-year audited duration that is mentioned in a due law is not germane to BLCM and Backbone and seems to be targeted during newly listed issuers.
In BLCMâ€™s case, a 3 year audited/operational story requirement should describe to a possess audited story and not that of an acquired business. BLCM has been listed on a sell for scarcely dual decades and a Company has simply transitioned from a vegetable descent industry, where it has been focused for 7 years, to cryptocurrency extraction. This enlargement from mining healthy line to digital line is one that many other companies on other tellurian exchanges have been following and reflects a physical change in a tellurian economy.
With that said, a Company skeleton to aggressively pursue swap listings of a Ordinary shares in Canada and also ascent a register of a ADR with BNY to a NASAQ or NYSE American exchanges. The Company has intent a law organisation of Peterson McVicar LLP in Toronto, Canada to conduct this process.Â Â
Both a ADR register and a approach register of a Companyâ€™s Ordinary shares on a Canadian batch sell will be instituted once Consolidated Audited Financials are finished for a duration finished 12/31/2017 that is coming to be finish of Feb 2018.
Even in a doubtful unfolding that: (1) a due law passes, (2) a preference is done that BLCMâ€™s typical shares should no longer be listed on a TASE, and (3) both events manifest before a Company is means to advantage additional typical share listings in a US or Canada, it is a Companyâ€™s bargain that a ADRâ€™s would continue to trade on a OTC. This conditions would be proxy until a Companyâ€™s typical shares are listed on a Canadian batch sell or a ADRâ€™s are listed on a inhabitant batch sell in a USA.
â€œAfter months of negotiations, travel, and due diligence, we am vehement to announce a decisive agreement between Blockchain Mining Ltd. and Backbone Hosting Solutions Inc. (Bitfarms). This transaction has been really formidable to tighten given a mixed jurisidictions, languages, and shareholders involved. We surmounted all these obstacles with team-work, perseverance, and an harsh concentration by a Board of Directors, Legal, Tax, and Financial Advisors delivering a staggering transaction for a shareholders,â€� pronounced Roy Sebag, Founder of Blockchain Mining Ltd.
â€œEver given we initial announced this transaction, a Company has been foul targeted by a timid regulator in Israel, who has done an try to singular out Blockchain for reasons that even now leave us nonplussed and disappointed.â€�
â€œAs entrepreneurs and business-builders, both a Bitfarms organisation and myself have motionless to keep a conduct down and pierce this transaction brazen for a advantage of a sold shareholders. As has guided my business career for roughly 15 years, we concentration on origination investments in businesses we trust in, run by industrious entrepreneurs, and characterized by considerable long-term economics. Bitfarms meets all of these characteristics and more. we am truly celebrated to be partial of this tour with this considerable organisation of individuals. This business, yet it is young, is really considerable both in terms of a cash-flowing intensity and a model demeanour in that it is run by ardent and dedicated founders. As we have regularly pronounced in mixed press outlets, there is no pledge these formula will be confirmed and any decrease in cryptocurrency prices will positively outcome in Bitfarms financial formula disappearing as well. Alas, we can't detract from a long-term intensity here, that in my perspective is substantial. That is eventually because all of us trust this transaction provides a best long-term bearing to a blockchain economy.â€� resolved Roy Sebag. Â
â€œThe Bitfarms supervision organisation is characterized by a entrepreneurial suggestion and a faith in blockchain record and how it can certain impact peopleâ€™s lives and a tellurian economy.â€� Said Emiliano J. Grodzki Backbone Hosting Solutions (Bitfarms) Founder and Chief Executive Officer.
â€œWe perspective a work during Bitfarms as a collaborative and critical bid to erect a infrastructure that eventually powers blockchain origination globally. It is a hardware that enables this new record to urge a relations between institutions and people obscure barriers to entry, shortening financial friction, and lenient billions of tellurian adults with entrance to this new universe of banking and commerce.â€�
â€œAs one of a usually plumb integrated cryptographic mining businesses, we wish to yield all stakeholders with a clarity of honour in what we do and demeanour brazen to stability to browbeat a space in both commissioned energy and hashing power,â€� resolved Emiliano J. Grodzki.
â€œThe Canadian supervision organisation is truly dedicated to aggressively flourishing a farms in Canada, some-more quite in Quebec where we are actively securing vast amounts of hydro-electric power. We strongly trust in a destiny of a Company and a blockchain and we find to build a largest and many fit mining farms in a world. The shutting of this transaction is a welcomed step in stability to build a organisation over a long-term,â€� pronounced Mathieu Vachon and Pierre-Luc Quimper, Founders of Backbone Hosting Solutions (Bitfarms).
GMP Securities L.P. and PowerOne Capital Markets Limited acted as financial confidant with honour to a sell described in this press release.
About Blockchain Mining Ltd.
Blockchain Mining (TASE:BLCM) (OTC:NRHYY) by a handling auxiliary Bitfarms, owns and operates blockchain farms that energy a tellurian decentralized financial economy. Bitfarms provides computing energy to cryptocurrency networks such as bitcoin, bitcoin cash, ethereum, litecoin, and lurch earning fees from any network for securing and estimate sell 24/7. Since 2013, Bitfarms has assembled 4 farms in Quebec, Canada that have 27.5 MW of commissioned ability and over 200 Ph/s of commissioned hash-power. Bitfarms’s construction tube includes an additional 3 farms with over 100 MW of energy capacity. The Company has been self-funded given a origination and has over 200 shareholders. For some-more information on Bitfarms, visit: www.bitfarms.io.
Completion of a transaction is theme to a series of conditions. The transaction can't tighten until a compulsory shareholder capitulation is obtained. There can be no declaration that a transaction will be finished as due or during all.
Investors are cautioned that, solely as disclosed in a Companyâ€™s regulatory disclosures to be prepared in tie with a transaction, any information expelled or perceived with honour to a sell described herein might not be accurate or finish and should not be relied upon. Trading in a bonds of Blockchain Mining should be deliberate rarely speculative.
No batch exchange, bonds elect or other regulatory supervision has authorized or disapproved a information contained herein. The Tel Aviv Stock Exchange has in no approach upheld on a merits of a due sell and has conjunction authorized nor disapproved a essence of this press release.
This news recover contains certain â€œforward-looking informationâ€� within a definition of germane Canadian bonds laws that are formed on expectations, estimates and projections as during a date of this news release. The information in this recover about a due business combination, a due financings, and a destiny skeleton and objectives of a Company, are forward-looking information. Other forward-looking information includes though is not singular to information concerning: a intentions, skeleton and destiny actions of a Company following a business combination, a timing for a doing of a business combination, a register of a Common Shares on batch exchanges, a intensity advantages of a business combination, a odds of a business multiple being completed, and receipt of germane shareholder approvals, as good as Backboneâ€™s ability to successfully cave digital currency, income augmenting as now anticipated, a ability to profitably repay a stream digital banking inventory, fluctuations in digital banking prices and a ensuing poignant disastrous impact on a Companyâ€™s operations, a sensitivity of digital banking prices, a construction and operation of blockchain infrastructure as now planned, and no law or law that will forestall Backbone from handling a business.
Any statements that engage discussions with honour to predictions, expectations, beliefs, plans, projections, objectives, assumptions, destiny events or opening (often though not always regulating phrases such as â€œexpectsâ€�, or â€œdoes not expectâ€�, â€œis expectedâ€�, â€œanticipatesâ€� or â€œdoes not anticipateâ€�, â€œplansâ€�, â€œbudgetâ€�, â€œscheduledâ€�, â€œforecastsâ€�, â€œestimatesâ€�, â€œbelievesâ€� or â€œintendsâ€� or variations of such difference and phrases or saying that certain actions, events or formula â€œmayâ€� or â€œcouldâ€�, â€œwouldâ€�, â€œmightâ€� or â€œwillâ€� be taken to start or be achieved) are not statements of chronological fact and might be forward-looking information and are dictated to brand forward-looking information.
This forward-looking information is formed on reasonable assumptions and estimates of supervision of Blockchain Mining during a time it was made, and involves famous and opposite risks, uncertainties and other factors that might means a tangible results, opening or achievements of a Company to be materially opposite from any destiny results, opening or achievements voiced or pragmatic by such forward-looking information. Such factors include, among others, risks relating to uncertainties compared with a business combination; risks relating to a business multiple agreement terminating in certain circumstances; risks relating to certain directors and officers of a Company presumably carrying interests in a business multiple that are opposite from other shareholders; risks that other conditions to a realisation of a business multiple agreement are not satisfied; tellurian mercantile climate; dilution; a Corporationâ€™s singular handling history; destiny collateral needs and doubt of additional financing; a rival inlet of a industry; banking sell risks; a need for a Corporation to conduct a designed enlargement and expansion; a effects of product enlargement and need for continued record change; insurance of exclusive rights; a outcome of supervision law and correspondence on a Corporation and a industry; network confidence risks;Â a ability of a Corporation to say scrupulously operative systems; faith on pivotal personnel; tellurian mercantile and financial marketplace decrease stopping entrance to collateral or augmenting a cost of capital; flighty bonds markets impacting confidence pricing separate to handling performance.Â In addition, sold factors that could impact destiny outcome of a business of Backbone embody though are not singular to:Â a construction and operation of blockchain infrastructure might not start as now planned, or during all; enlargement might not manifest as now anticipated, or during all; a digital banking market; a ability to successfully cave digital currency; income might not boost as now anticipated, or during all; it might not be probable to profitably repay a stream digital banking inventory, or during all; a decrease in digital banking prices might have a poignant disastrous impact on operations; a sensitivity of digital banking prices; chronological prices of digital currencies and a ability to cave digital currencies that will be unchanging with chronological prices; and there will be no law or law that will forestall Backbone from handling a business. The Company has also insincere that no poignant events start outward of a Backbone’s normal march of business.Â Although Blockchain Mining has attempted to brand critical factors that could means tangible formula to differ materially, there might be other factors that means formula not to be as anticipated, estimated or intended. There can be no declaration that such statements will infer to be accurate as tangible formula and destiny events could differ materially from those expected in such statements. Accordingly, readers should not place undue faith on forward-looking information. Blockchain Mining undertakes no requirement to correct or refurbish any forward-looking information other than as compulsory by law.
Mathieu Vachon,Â Director of Software Engineering