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AmWolf Capital and Pontus Water Lentils Enter into Letter of Intent for Qualifying Transaction

VANCOUVER , Nov. 21, 2019 /CNW/ - AmWolf Capital Corp. ("AmWolf" or the "Company") (TSXV: AMW.P) a capital pool company ("CPC") as defined under Policy 2.4 – Capital Pool Companies ("Policy 2.4") of the TSX Venture Exchange (the "Exchange"), is pleased to announce it has entered into a letter of intent dated November 15, 2019 (the "LOI") with Pontus Water Lentils Ltd. ("Pontus"), a private company incorporated under the  Canada Business Corporations Act, pursuant to which AmWolf and Pontus (each, a "Party" and together, the "Parties") have agreed to complete a plan of arrangement, amalgamation, or other statutory procedure (the "Transaction") whereby AmWolf will acquire all of the issued and outstanding common shares of Pontus (collectively, the "Pontus Shares"). The precise terms of the Transaction, including the structure of the Transaction, will be incorporated into a definitive transaction agreement (the "Definitive Agreement") to be negotiated between the Company and Pontus. In connection with the Transaction, Pontus intends to complete a non-brokered private placement to raise minimum gross proceeds of $2,000,000 (the "Private Placement").

The Transaction is subject to the approval of the Exchange, and is intended to constitute the Company's Qualifying Transaction (as defined in Policy 2.4). It is expected that the Company (following the closing of the Transaction, referred to as the "Resulting Issuer") will be listed on the Exchange as a Tier 2 Industrial issuer.

Pontus Water Lentils Ltd.

Pontus was founded in 2018, and is a private Victoria , British Columba-based agri-tech company specializing in the sustainable farming of water lentils to create a non-GMO plant-based protein product called Pure Plant Protein Powder™ or Pontus P4™. Pontus' P4™ protein powder is a 42.1% pure plant protein, high in antioxidants, essential vitamins and minerals, grown without the use of solvents, chemicals, dyes, additives, preservatives or pesticides. Following the closing of the Transaction (the "Closing"), the business of the Resulting Issuer will be the business of Pontus.

The principal shareholders of Pontus (collectively, the "Principal Shareholders") are, on an undiluted basis: Steve McArthur – approximately 15.88%; Connor Yuen – approximately 13.63%; Alson Niu – approximately 13.38%; and 1173727 B .C. Ltd. DBA Conquest Capital (a company incorporated under the laws of the Province of British Columbia and controlled by Messrs. Yuen and Niu) – 12.35%. All Principal Shareholders are residents of British Columbia .

A summary of Pontus' financial information will be included in a subsequent press release once such financial information has been obtained by the Company.

Summary of the Transaction

The LOI sets out the general terms of the Transaction as currently contemplated by the Parties. The precise terms and conditions of the Transaction will be contained in the Definitive Agreement to be negotiated and entered into by the Parties. The Parties have agreed to negotiate in good faith to reach the Definitive Agreement on or before January 15, 2020 , and consummate the Transaction on or before March 31, 2020 (the "Closing Date").

The Transaction will take the form of an arrangement, amalgamation or other statutory procedure whereby all of the outstanding Pontus Shares will be exchanged for such number of common shares in the capital of the Company as is equal to the number of Pontus Shares issued and outstanding on the Closing Date (the "Consideration Shares"). Following the Closing, Pontus will become a wholly-owned subsidiary of the Company. The Transaction will be completed pursuant to, and in strict accordance with, corporate law requirements and available exemptions under applicable securities legislation. The Consideration Shares will be subject to applicable resale restrictions, if any.

The completion of the Transaction is subject to the satisfaction of various conditions as are standard for a transaction of this nature, including but not limited to: (i) the Company having had the reasonable opportunity to perform searches and other due diligence, and being satisfied with the results of such due diligence; (ii) receipt of all requisite consents, waivers and approvals for the Transaction, including the approval of the Exchange; (iii) the absence of any material adverse change in the business, affairs or operations of AmWolf or Pontus; (iv) completion of the Private Placement; and (v) Pontus having received the requisite approvals from its shareholders for the Transaction.

Assuming the completion of the Transaction, the minimum subscription of the Private Placement, and that no convertible securities of AmWolf are exercised, a minimum of 45,500,001 common shares of the Resulting Issuer (each, a "Resulting Issuer Share") are expected to be issued and outstanding on the Closing Date of which approximately 12.1% Resulting Issuer Shares will be held by the current shareholders of the Company, approximately 58.6% will be held by the former shareholders of Pontus, and 29.3% will be held by the subscribers under the Private Placement.

The Transaction is an arm's length transaction and therefore will not require shareholder approval under Policy 2.4.

Private Placement

In connection with the Transaction, it is anticipated that Pontus will complete the Private Placement to raise minimum gross proceeds of $2,000,000 by the issuance of 13,333,333 Pontus Shares at $0.15 per share. There may be cash commissions and/or broker warrants paid and/or issued to eligible finders in relation to the Private Placement.

Directors, Officers and Insiders of the Resulting Issuer

Following the Closing, it is expected that the following individuals will be appointed as management of the Resulting Issuer:

Connor Yuen , Chief Executive Officer

Prior to his appointment as Chief Executive Officer of Pontus, Connor Yuen climbed to the top 1% of executives representing Amway Corporation, where he maintained that position for 7 years. Following his time with Amway Corporation, Mr. Yuen has taken his sales aptitude and shifted his focus to understanding the securities and capital markets industry. Mr. Yuen was also Co-Founder of Planet Preservation Vancouver, a not-for-profit organization that provided free pick-up services of recyclable items in Vancouver's lower mainland.

Steve McArthur , Chief Technology Officer

Steve McArthur is experienced with aquaponic systems design and facility operations, and has dedicated himself to the future of farming through this technology. Mr. McArthur co-founded Pontus, Garden City Aquaponics Inc., and Green Oasis Foods Ltd., and is currently working towards a degree in engineering at the University of Victoria . Mr. McArthur has also attended aquaponic training with Nelson & Pade, Inc., NOA Fisheries, Green'n Aquaponic Farms, You Grow Food, helped develop Metchosin Acquaponics, and taken informative tours at Perfect Plants ( Netherlands ), Taste of BC Farms, Sunshine Coast Aquaponics, Raincoast Aquaponics, Devon Nurseries, and Mason St. Farms.

Officers and Directors

In connection with the Transaction, it is expected that the officers and board of directors of the Company will resign and be replaced by nominees determined by the Parties. Further information regarding the proposed nominees of the Parties will be included in a subsequent press release once such nominees have been identified.

Sponsorship

Sponsorship of a Qualifying Transaction of a Capital Pool Company is required by the Exchange unless an exemption from the sponsorship requirement is available. The Company intends to apply for a waiver from the sponsorship requirements. There is no assurance that the Company will be able to obtain such a waiver.

Finder's Fee

In connection with the Transaction, the Parties agree that finder's fees may be paid concurrently with the Closing to eligible finders who are not Related Parties to either Pontus or AmWolf, as defined by the policies of the Exchange, up to the maximum amount permitted by the policies of the Exchange and subject to approval of the Exchange.

About AmWolf Capital Corp.

AmWolf Capital Corp. is a Capital Pool Company as defined by the policies of the Exchange. The Company's principal business activity is to identify and evaluate opportunities for acquisition of assets or business. The Company is headquartered in Vancouver, British Columbia .

About Pontus Water Lentils Ltd.

Pontus Water Lentils Ltd. was founded in 2018, and is a Victoria -based agri-tech company. Pontus specializes in aquaponic farming through Closed Environment Vertical Aquaponics System™ to create a sustainable, non-GMO plant-based protein product: Pure Plant Protein Powder™ or Pontus P4™. For more information, visit www.pontuswaterlentils.com.

Additional Information

A comprehensive press release with further particulars relating to the Transaction, including further particulars of the Resulting Issuer and the Private Placement, will follow in accordance with the policies of the Exchange. In addition, a summary of Pontus' financial information will be included in a subsequent press release.

All information contained in this press release with respect to the Company and Pontus was supplied, for inclusion herein, by the respective Parties and each Party and its directors and officers have relied on the other Party for any information concerning the other Party.

Completion of the Transaction is subject to a number of conditions, including but not limited to, Exchange acceptance and if applicable pursuant to Exchange 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 management information circular or filing statement 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 a capital pool company should be considered highly speculative.

The TSX Venture Exchange Inc. has in no way passed upon the merits of the proposed Transaction and has neither approved nor disapproved the contents of this press release.

Disclaimer for Forward-Looking Information

Certain statements in this press release are forward-looking statements, which reflect the expectations of management regarding the Company's completion of the Transaction and related transactions. Forward-looking statements consist of statements that are not purely historical, including any statements regarding beliefs, plans, expectations or intentions regarding the future, including but not limited to, the Company completing the Transaction, the Company entering into the Definitive Agreement, the completion of the Private Placement, the proposed officers of the Resulting Issuer and the conditions to be satisfied for completion of the Transaction. Such statements are subject to risks and uncertainties that may cause actual results, performance or developments to differ materially from those contained in the statements, including risks related to factors beyond the control of the Company. The risks include the following: the Parties may not enter into the Definitive Agreement; the requisite corporate approvals of the directors and shareholders of the Parties may not be obtained; the Exchange may not approve the Transaction; sufficient funds may not be raised pursuant to the Private Placement; and other risks that are customary to transactions of this nature. No assurance can be given that any of the events anticipated by the forward-looking statements will occur or, if they do occur, what benefits the Company will obtain from them.

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

SOURCE AmWolf Capital Corp.


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