Yubba and Ruckify Enter into Binding Letter of Intent to Complete Qualifying Transaction

10/4, 7:09 PM (Source: Newsfile Corp)

Toronto, Ontario--(Newsfile Corp. - October 4, 2021) - Yubba Capital Corp. (TSXV: YUB.P) ("Yubba") and Ruckify Inc. ("Ruckify") are pleased to announce that they have entered into a binding letter of intent dated October 2, 2021 (the "LOI"), which outlines the terms and conditions pursuant to which Yubba and Ruckify will complete a transaction that will result in a reverse take-over of Yubba by Ruckify (the "Proposed Transaction"). The Proposed Transaction will be an arm's length transaction, and, if completed, will constitute Yubba's "Qualifying Transaction" (as such term is defined in Policy 2.4 of the TSX Venture Exchange (the "TSXV")).

Immediately prior to the closing of the Proposed Transaction, Ruckify intends to complete its proposed arm's length acquisition (the "Fat Llama Acquisition") of Fat Llama Inc. ("Fat Llama") by way of a reverse "triangular merger" of a wholly-owned subsidiary of Ruckify, with and into Fat Llama pursuant to the terms of a merger agreement dated September 14, 2021 between Ruckify, Ruckify Subco. Inc. and Fat Llama (the "Fat Llama Merger Agreement"). Fat Llama will be the surviving corporation following such merger and, as a result, will become a wholly-owned operating subsidiary of Ruckify. Pursuant to the terms of the Fat Llama Merger Agreement, (i) each issued and outstanding share of common stock and preferred stock of Fat Llama (each, a "Fat Llama Share") (other than shares held by Fat Llama shareholders who demanded and perfected appraisal rights in accordance with Section 262 of the Delaware General Corporation Law and not effectively withdrawn or forfeited prior to the closing of the Fat Llama Acquisition) will be automatically cancelled and converted into 1.841 fully paid and non-assessable common shares in the capital of Ruckify (the "Ruckify Shares") and (ii) each Fat Llama option (a "Fat Llama Option") outstanding immediately prior to the closing of the Fat Llama Acquisition will be automatically cancelled in exchange for an option to purchase 1.841 Ruckify Shares for each share of Fat Llama common stock issuable pursuant to such Fat Llama Option.

Ruckify

Founded in Ottawa, Canada, in 2017 Ruckify's peer-to-peer rent anything marketplace provides a platform enabling Ruckify users to monetize their assets while at the same time leverage the sharing economy to rent items and minimize what they own, avoiding investment in depreciating assets. Ruckify provides its users with the freedom to do what they want when they want without the restrictions of time, storage, price or availability. In doing so, Ruckify supports sustainability by providing people the means to optimize the use of thousands of items within their communities.

To accelerate its growth, Ruckify identified Fat Llama, the leading rent anything marketplace in the United Kingdom, as a strategic acquisition target. Ruckify expects that Fat Llama's advanced technology and proven business model will provide the foundation upon which it can more effectively operate its marketplace. Ruckify and Fat Llama expect that by working together as one, the merged entity can rapidly expand into new markets and become the global rent anything marketplace leader.

Proposed Transaction Summary

The Proposed Transaction is expected to be structured as a three-cornered amalgamation, whereby a wholly-owned subsidiary of Yubba will amalgamate with Ruckify (the "Amalgamation") to form a newly amalgamated company ("Amalco"). Pursuant to the Amalgamation, holders of Ruckify Shares will receive one common share in the capital of Yubba (each, a "Yubba Share") for each Ruckify Share held. In addition, pursuant to the Amalgamation, each Ruckify stock option and each Ruckify warrant will be exchanged for a Yubba stock option or Yubba warrant, as applicable, on substantially the same terms and conditions, except that such securities will thereafter be exercisable to receive one Yubba Share.

In order to align the value of the Yubba Shares with the value per Ruckify Share at which the Proposed Transaction will be completed, it is anticipated that Yubba will consolidate its common shares on the basis of one post-consolidation Yubba Share for every 7.598 existing Yubba Shares (the "Consolidation"). Pursuant to the terms of the Proposed Transaction, Yubba Shares are being valued at $0.19 per Yubba Share and the Ruckify Shares shall have an implied value equal to the terms of the Ruckify subscription receipts issuable pursuant to the proposed private placement subscription receipt financing of Ruckify to be completed in connection with the Proposed Transaction (the "Offering").

As at the date of this news release, Yubba has 5,220,000 common shares and 477,600 stock options, each exercisable to acquire one Yubba Share (on a pre-Consolidation basis).

Upon completion of the Proposed Transaction, Yubba will be the parent and sole shareholder of Amalco and thus will indirectly carry on the business of Ruckify. As a result, Yubba intends to change its name to "Fat Llama Corporation" or such other name as is acceptable to the regulators (the "Name Change"). Further, it is proposed that the officers and directors of Ruckify will replace the existing officers and directors of Yubba. Biographical information regarding these individuals is provided below under the heading "Officers and Directors."

The Proposed Transaction is subject to the parties successfully entering into a definitive agreement in respect of the Proposed Transaction on or before November 30, 2021, or such other date as Ruckify and Yubba may mutually agree. Completion of the Proposed Transaction is also subject to a number of other conditions, including obtaining all necessary board, shareholder and regulatory approvals, including TSXV approval.

In connection with the Proposed Transaction, Yubba will convene a meeting of its shareholders for the purpose of approving, among other matters, the Consolidation, the Name Change and the election of the directors to replace the current directors of Yubba immediately following the completion of the Proposed Transaction. Ruckify will convene a meeting of its shareholders for the purpose of approving the Amalgamation and the Proposed Transaction. The Proposed Transaction has been unanimously approved by the boards of directors of Ruckify and Yubba and both boards of directors recommend that their respective shareholders vote IN FAVOR OF the Proposed Transaction and related matters.

As at the date hereof, Ruckify has the following securities issued and outstanding: 13,972,219 Ruckify Shares, options to acquire 1,066,405 Ruckify Shares and warrants to acquire 185,336 Ruckify Shares. As at the date hereof, Fat Llama has the following securities issued and outstanding: 21,116,364 Fat Llama Shares and Fat Llama Options to acquire 1,328,735 Fat Llama Shares.

On completion of the Proposed Transaction and assuming completion of the Fat Llama Acquisition (including the exercise of certain Fat Llama Options) and the Consolidation, it is anticipated that there will be an aggregate of approximately 55,005,745 Yubba Shares issued and outstanding and additional securities convertible into or exercisable to acquire 6,689,460 Yubba Shares. The breakdown of such post-completion Yubba share ownership is as follows: former shareholders of Yubba will hold 687,022 Yubba Shares, representing 1.2% of the outstanding Yubba Shares; former shareholders of Ruckify will hold 13,972,219 Yubba Shares, representing 25.4% of the outstanding Yubba Shares; and former shareholders of Fat Llama will hold 40,346,504 Yubba Shares, representing 73.3% of the outstanding Yubba Shares (on a non-diluted basis).

No finder's fees are payable in connection with the Proposed Transaction. A filing statement or joint management information circular of Ruckify and Yubba will be prepared and filed in accordance with the policies of the TSXV.

Officers and Directors

Subject to applicable shareholder and TSXV approval, it is anticipated that the officers and directors of the combined company will be:

Bruce Linton - Chairman, Chief Executive Officer and Director

Mr. Linton was the founder and former Chairman, Chief Executive Officer and Co-Chief Executive Officer of Canopy Growth Corporation ("Canopy"), formerly Tweed Marijuana Incorporated, a cannabis company based in Smiths Falls, Ontario, Canada. Bruce founded Tweed in 2013 and renamed it Canopy Growth Corporation in 2015. Canopy was the first cannabis company in North America to be listed on a major stock exchange (TSXV in April 2014 and TSX in July 2016) and to be included on a major stock index (S&P/TSX Composite Index in March 2017). Bruce co-founded Canopy Rivers in 2017 and Canopy Health Innovations in 2018. Bruce's founding idea grew to a TSXV listed start-up with an $80 million market cap to a NYSE/TSX listed company (S&P/TSX60) including more than 30 M&A activities, ranking number one of the TSX30 with a market cap of over $20 billion by the summer of 2019. Bruce's experience as a founder, CEO, and board member across a diversity of sectors was a huge influence for the success of Canopy. Earning market support for 16 rounds of financing of over $6 billion in public capital markets and private placements, the company funded capacity growth and opened new markets, including a $5 billion CAD investment by Fortune 500 beverage company, Constellation Brands.

Notably, throughout his career, Bruce has been responsible for the acquisition and/or disposition of nearly $4 billion in business assets and has established regular engagement with the World Bank and Asia Development Bank as well as companies listing with NYSE, NASDAQ, TSX and TSXV. Bruce has overseen over 35 acquisitions in 6 countries.

Currently, he also holds the positions of: Executive Chairman for Gage Cannabis Co., Co-Chairman for Martello Technologies Group. He is also Chairman of the Advisory Board for Red Light Holland Corp., Non-Executive Chairman of Oskare Capital, Director with Mindmed and the Canadian Olympic Foundation, and an active investor with SLANG Worldwide Inc., and OG DNA Genetics Inc. Beginning his journey at Newbridge Networks Corporation, Bruce went on to be part of the establishing team at Crosskeys Systems Corporation, of which he was a key member for the NASDAQ/TSX IPO. He was GM and Re-Founder of Computerland.CA, and Co-Founder of Webenhancer Corp. Bruce has acted as CEO and Director at Clearfield Water Systems, Inc., past Chairman of the Ottawa Community Loan Foundation, past board member and Treasurer of Canada World Youth, and past member of the Board of Governors for Carleton University.

Dean Cosman - Chief Financial Officer

Dean Cosman joined Ruckify in August 2020 after spending 25 years in the financial services sector where he held executive level roles at both Export Development Canada (EDC) and Canada Deposit Insurance Corporation (CDIC). Most recently, Mr. Cosman served as Executive Vice-President and Chief Risk Officer at Canada Deposit Insurance Corporation. Prior to that he led CDIC as Interim Chief Executive Officer. He also held the roles of Senior Vice-President, Insurance and Risk Assessment and Vice-President and Chief Financial Officer. Dean holds a Bachelor of Commerce Degree from Carleton University and is a Chartered Professional Accountant, Chartered Accountant.

Richard Warren - Chief Technology Officer

Mr. Warren currently acts as Chief Technology Officer of Fat Llama's wholly-owned subsidiary, Fat Llama Limited ("Fat Llama UK"). During Mr. Warren's time with Fat Llama UK, he helped raise $13,200,000 from investors. Mr. Warren is an experienced search engine optimization consultant, crowd funder, investment analyst and e-commerce entrepreneur.

Joseph Mimran - Director

Mr. Mimran is among Canada's leading fashion and retail pioneers and entrepreneurs. Throughout his career, he has founded or co-founded and built brands that have helped define the fashion industry landscape, including Joe Fresh™, Club Monaco, Alfred Sung, Caban and, with his wife Kimberley Newport-Mimran, Pink Tartan. In addition, Mr. Mimran is the Chairman of Gibraltar & Company, Inc., a private investment management company, and was formerly the Co-CEO of Gibraltar Opportunity, Inc., a provider of advisory and revenue acceleration services, and Gibraltar Growth Corporation, a special acquisition corporation. Mr. Mimran was the founder and former Creative Director of the Joe Fresh™ brand for Loblaws, where he led the entire creative process for the women's, men's and children's apparel line, from product design to marketing and advertising to store selection and design for the merchandising of the line. Mr. Mimran founded the consulting firm Joseph Mimran & Associates Inc. ("JMA") in 2001. In 2003, Loblaws engaged JMA to design home products under its President's Choice brand, followed by all general merchandise categories by 2009. Mr. Mimran co-founded The Monaco Group (which included Alfred Sung, a high-end fashion women's wear line, and Club Monaco, a fashion-forward, high-end casual clothing retailer) in 1980 and took the company public in 1986. The company was purchased by Dylex in 1989. In 1991, Mr. Mimran repurchased Club Monaco from Dylex, founded and launched Caban (a design-oriented home furnishings retailer) and took the business public in 1997. In 1999, he sold Club Monaco (and Caban) to Ralph Lauren for an equity value of $77,500,000. Mr. Mimran has been the recipient of many industry awards, including the Canadian Style Award and the lifetime achievement award by the Design Exchange, and in 2015 he was inducted into Canada's Marketing Hall of Legends. Mr. Mimran began his career at Coopers & Lybrand (now PricewaterhouseCoopers) after receiving his Chartered Accountant designation.

Charles Englander - Director

Mr. Englander currently acts as Chief Executive Officer and Co-Founder of Fat Llama. Mr. Englander holds a bachelor's degree in accounting and finance from the University of Wales.

Rose Dallas - Director

Ms. Dallas currently acts as Chief Operating Officer and Co-Founder of Fat Llama.

Sponsorship

The Proposed Transaction is subject to the sponsorship requirements of the TSXV, unless a waiver or exemption from this requirement can be obtained in accordance with the policies of the TSXV. Yubba 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.

This news release does not constitute an offer of securities for sale in the United States. The securities being offered have not been, nor will they be, registered under the United States Securities Act of 1933, as amended, and such securities may not be offered or sold within the United States absent U.S. registration or an applicable exemption from U.S. registration requirements.

Ruckify is represented by Cassels Brock & Blackwell LLP.

A subsequent news release with respect to the Offering and including a summary of certain significant financial information with respect to Ruckify will follow in due course.

Cautionary Note Regarding Forward-Looking Information

This press release contains statements which constitute "forward-looking information" within the meaning of applicable securities laws, including statements regarding the plans, intentions, beliefs and current expectations of Yubba and Ruckify with respect to future business activities and operating performance. Forward-looking information is often identified by the words "may", "would", "could", "should", "will", "intend", "plan", "anticipate", "believe", "estimate", "expect" or similar expressions and includes information regarding: (i) expectations regarding whether the Fat Llama Acquisition or the Proposed Transaction will be consummated, including whether conditions to the consummation of the Fat Llama Acquisition or Proposed Transaction, as applicable, will be satisfied, or the timing for completing the Fat Llama Acquisition and the Proposed Transaction, (ii) the anticipated benefits of the Fat Llama Acquisition and (iii) expectations for other economic, business, and/or competitive factors.

Investors are cautioned that forward-looking information is not based on historical facts but instead reflect Yubba and Ruckify' respective management's expectations, estimates or projections concerning future results or events based on the opinions, assumptions and estimates of management considered reasonable at the date the statements are made. Although Yubba and Ruckify believe that the expectations reflected in such forward-looking information are reasonable, such information involves risks and uncertainties, and undue reliance should not be placed on such information, as unknown or unpredictable factors could have material adverse effects on future results, performance or achievements of the combined company. Among the key factors that could cause actual results to differ materially from those projected in the forward-looking information are the following: the ability to consummate the Fat Llama Acquisition; the ability to obtain requisite approvals and the satisfaction of other conditions to the consummation of the Fat Llama Acquisition on the proposed terms and schedule; the ability to consummate the Proposed Transaction; the ability to obtain requisite regulatory and shareholder approvals and the satisfaction of other conditions to the consummation of the Proposed Transaction on the proposed terms and schedule; the potential impact of the announcement or consummation of the Proposed Transaction on relationships, including with regulatory bodies, employees, suppliers, customers and competitors; the re-rating potential following the consummation of the Proposed Transaction; changes in general economic, business and political conditions, including changes in the financial markets; and the diversion of management time on the Proposed Transaction. This forward-looking information may be affected by risks and uncertainties in the business of Yubba and Ruckify and market conditions.

Should one or more of these risks or uncertainties materialize, or should assumptions underlying the forward-looking information prove incorrect, actual results may vary materially from those described herein as intended, planned, anticipated, believed, estimated or expected. Although Yubba and Ruckify have attempted to identify important risks, uncertainties and factors which could cause actual results to differ materially, there may be others that cause results not to be as anticipated, estimated or intended. Yubba and Ruckify do not intend, and do not assume any obligation, to update this forward-looking information except as otherwise required by applicable law.

For further information, please contact:

Ruckify Inc.
Dean Cosman
Chief Financial Officer
dcosman@ruckify.com

Yubba Capital Corp.
Brian Morales
Director
bmorales@bjmorales.com

Completion of the Proposed 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 Proposed Transaction cannot close until the required shareholder approval is obtained. There can be no assurance that the Proposed Transaction will be completed as proposed or at all.

Investors are cautioned that, except as disclosed in the filing statement or joint management information circular of Yubba and Ruckify to be prepared in connection with the Proposed Transaction, any information released or received with respect to the Proposed Transaction may not be accurate or complete and should not be relied upon. Trading in the securities of Yubba should be considered highly speculative.

The TSXV has in no way passed upon the merits of the Proposed Transaction and has not approved or disapproved of the contents of this news release.

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.

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