Farstarcap Announces Proposed Qualifying Transaction to Acquire Herdwhistle Technologies Inc.

Vancouver, British Columbia--(Newsfile Corp. - September 20, 2023) - Farstarcap Investment Corp. (TSXV: FRS.P) ("Farstarcap" or the "Company") is pleased to announce that it has entered into a letter of intent (the "LOI") dated September 11th, 2023, with HerdWhistle Technologies Inc. ("HWT") regarding a proposed transaction to acquire all of the issued and outstanding securities of HWT (the "Transaction"). Upon completion of the Transaction, the combined entity (the "Resulting Issuer") will continue the business of HWT as a Tier 2 "technology" issuer. The Transaction is intended to constitute the "Qualifying Transaction" of Farstarcap, as such a term is defined in Policy 2.4 – "Capital Pool Companies" of the TSX Venture Exchange (the "Exchange").

The Transaction is not a "Non-Arm's Length Qualifying Transaction" pursuant to the policies of the Exchange and, as such, the Company is not required to obtain shareholder approval for the Transaction.

The Qualifying Transaction

Subject to the execution of a definitive agreement ("Definitive Agreement"), Farstarcap proposes to acquire from the shareholders of HWT all the issued and outstanding securities of HWT in exchange for securities of Farstarcap. Upon closing of the Transaction ("Closing"), Farstarcap will issue: (i) three (3) common shares of Farstarcap ("Payment Shares") for each one (1) common share of HWT; and (ii) for every one dollar of principal amount of convertible debentures issued and outstanding, six and one-half (6.5) Payment Shares to a maximum of 1,250,000 Payment Shares. The parties anticipate a total of approximately 61,666,665 Payment Shares will be issued to the shareholders of HWT with a deemed issuance price of approximately $0.20 per Payment Share, representing a deemed valuation of HWT of approximately C$12,333,333. The issuance of the aggregate total of 62,916,665 Payments Shares consists of 61,666,665 Payment Shares to the existing shareholders of HWT and up to 1,250,000 Payment Shares to be issued to the convertible debenture holders.

It will be a condition of Closing that immediately prior to Closing there will not be outstanding any securities convertible into shares of HWT other than up to $200,000 of the convertible debentures.

The closing of the Transaction will be conditional upon HWT completing a private placement financing of subscription receipts (the "Subscription Receipts") at a price of $0.20 per subscription receipt unit, each of which will, prior to the effective time of the Transaction, automatically convert into one (1) common share of HWT and one whole common share purchase warrant of HWT (each whole common share purchase warrant, a "Financing Warrant"), with each Financing Warrant exercisable into a common share of HWT at an exercise price of $0.40 per share for a period of three years, for no additional consideration upon the satisfaction of certain escrow release conditions, including the conditional approval of the Exchange for the Transaction and satisfaction or waiver of all of the conditions precedent to the Transaction as set out in the Definitive Agreement (the "Concurrent Financing"), to raise a minimum gross proceeds of $4,000,000.

Farstarcap intends to make an application for a waiver from the Exchange's sponsorship requirements.

No finder's fee will be payable by either Farstarcap or HWT in connection with the Transaction.

The Transaction is conditional upon, among other things:

  1. receipt of all necessary regulatory and third-party consents, approvals and authorizations as may be required in respect of the Transaction, including, but without limitation, acceptance of the Exchange;
  2. completion of due diligence to the satisfaction of the parties;
  3. approval of the board of directors of each of Farstarcap and HWT to final terms and conditions of the Transaction as set forth in the Definitive Agreement and all other necessary matters related thereto prior to the signing of the Definitive Agreement;
  4. the signing of the Definitive Agreement;
  5. completion of all matters, and the satisfaction of all conditions (unless waived in writing), under the Definitive Agreement required to be completed or satisfied on or before closing of the Transaction including but not limited to the completion of the Concurrent Financing; and
  6. approval of the Transaction by the shareholders of HWT.

Capitalization of HWT

As of the date hereof, HWT's authorized share capital consists of an unlimited number of common shares and an unlimited number of preferred shares, issuable in series, of which 20,000,000 common shares and no preferred shares are issued and outstanding. In addition, HWT currently has $200,000 aggregate principal amount of convertible debentures issued and outstanding which convert into common shares (Payment Shares) of HWT at a 20% discount to the Subscription Receipts offering price of $0.20.

Capitalization of Farstarcap

As of the date hereof, Farstarcap's authorized share capital consists of an unlimited number of common shares and an unlimited number of preferred shares, issuable in series, of which 5,610,001 common shares are issued and outstanding. In addition, Farstarcap has 250,000 stock options issued and outstanding.

Other Information

Farstarcap will issue additional news releases related to the final legal structure and terms of the Transaction, post-closing capitalization of the Resulting Issuer, financial information regarding HWT, the names and background of insiders of the Resulting Issuer and other material information as it becomes available.

Trading in the common shares of Farstarcap is presently halted. The common shares of Farstarcap will remain halted until the Transaction is completed and approved by the Exchange.

As HerdWhistle and Farstarcap embark on this transformative journey, they do so with the collective ambition to redefine the future of agriculture. Their shared vision for a world where technology and sustainability converge promises to usher in an era of unprecedented growth and innovation in precision livestock farming (PLF).

HerdWhistle (https://herdwhistle.com), a trailblazing company dedicated to advancing precision livestock farming (PLF) technologies, has consistently been at the forefront of innovation. Their impressive track record of deploying commercial PLF technologies has set a new standard for the industry.

About HerdWhistle Technologies Inc.

HWT is a private company and was incorporated on January 6, 2021, by Certificate of Incorporation issued pursuant to the provisions of the Business Corporations Act (Alberta). HerdWhistle Technologies Inc. (https://herdwhistle.com) is dedicated to advancing precision livestock farming (PLF) technologies. Their innovative solutions empower farmers to enhance animal welfare, optimize resource utilization, and drive agricultural productivity.

Proposed Management and Board of Directors of the Resulting Issuer

Subject to Exchange approval, on completion of the Transaction, it is currently anticipated that the board of directors of the Resulting Issuer will consist of five (5) directors. The proposed management is anticipated to be:

Dr. Jack Behan, Chief Executive Officer (CEO)
Dr. Jack Behan has a PhD in Reproductive Physiology and Genetics from the Royal Veterinary College, London. He has held several key positions at Commercial Director, Chief Operating Officer and Chief Executive Officer level for multi-species, multinational genetic companies, assisted reproductive technology (ART) innovators, and veterinary tech companies. In 2019 he successfully orchestrated the IPO of a bio-tech company, since 2012 Dr. Behan has successfully raised in excess of €70 million private equity for bio-tech businesses.

Graham Plastow, Chief Science Officer (CSO)
Graham Plastow has 40 years' experience of the management and implementation of multidisciplinary research projects and technology transfer on an international basis including industry/academic collaborations in the agri-food sector. Excellent track record of building teams capable of bridging advanced technology research and market need. Appointed Chief Technology Officer and an Executive Director of one of the world's largest animal breeding companies (a UK plc) in 2001. Contributed to a market capitalization increase of 100% in 2001-2005 to £180+ million ($360m). Returned to academia in 2007 and Professor and CEO of Livestock Gentec at the University of Alberta. Excellent track record of building teams capable of bridging advanced technology research and market need. Co-authored more than 250 scientific papers/chapters, patents and patent applications with research collaborations in US, Canada, Europe, China, and Australia. Co-ordinator or participant of several multi-million dollar projects in Europe and N. America. Worked with many of the world's pig, cattle and poultry breeding companies through research collaboration or consultancy. Member of numerous boards and committees including the Governing Council of the Roslin Institute (2001-07), Genesis Faraday Partnership (2006-09), Dairy Cattle Genetics Research and Development (DairyGen) Council of Canada (from 2012), and AgSights (from 2012). He has a wealth of experience of managing data sharing and intellectual property through to application and improving the performance of value chains in agriculture.

Adam Morand, Chief Operating Officer
Mr. Morand is the Co-founder, Chief Operating Officer and a director of HWT. Mr. Morand is an Entrepreneurial Technologist passionate about innovation and industrial localisation of all basic human needs. His lifetime goal is to see economically viable technologies creating a global abundance of food, energy, clothing, shelter, clean air and fresh water. Mr. Morand is imbued with an innate need to improve, seek efficiencies, create, build and solve puzzles; every day is an opportunity to do good. Fortunate to have started at an early age with digital electronics and computer programming in the 1980's; and then moving to Vancouver in the 1990's to professionally experience the rise and fall of the dotcom era, Mr. Morand serendipitously landed in myriad early startups on the West Coast working with large data for casinos, entertainment and financial payment systems; travelling around the world setting up enterprise data systems, networks, banks and working with amazing teams of people. In 1999, Mr. Morand designed and wrote competitive eSports patent for massive online multi-player game tournament and financial payment systems. Founded Moshpit Entertainment and the Bloodmoney Universe the worlds first platform playing competitive games for cash. Mr. Morand founded Illuminated Technologies in 2001 to build and deploy disruptive software platforms and supporting mission-critical enterprise data structures and high-volume data centre infrastructures. The incredibly talented Illuminated team completed more than 1,000 projects over 5 years and spawned dozens of joint ventures and startups. To better understand food, Mr. Morand retired in 2006 to be a farmer, experimenting with Aquaponics and agricultural technologies; which logically lead into IoT (Internet of Things) development and ERP(Enterprise Resource Planning) / MRP (Manufacturing Resource Planning) business systems. In 2009, Mr. Morand moved to Alberta for a new opportunity to turn around a stagnate national service company in the energy sector. He rewrote the business systems and technology platforms to facilitate growth and offer new enterprise data services; incorporated machine learning and algorithmic development to streamline resources while creating new digital services. He founded A4 Systems Corp in2015 to specialise in Pan-Industrial Cyber-Physical systems development and deployment. He is involved with AgriPlay Ventures to create global food security. He is involved with HWT to create livestock technologies for a more efficient world. When not building companies, technologies or business systems; Adam can be found farming.

Andrew Jonsson, Chief Financial Officer
An accomplished professional accountant with 27 years' experience, working in senior finance positions with leading global companies such as Finning International and Aviva Insurance. In addition, have supported CEO's in a multitude of other industries and SME's through the start-up phase to Series B equity raise. Have demonstrated success in the areas of M&A, financial management, strategic performance management and business planning. In 2008, Andrew formed his company - Calgary CFO Consulting Services and has enjoyed working with a variety of organizations and executive teams to dramatically improve organizational excellence and surpass performance expectations. Andrew's passion is working with others to improve the impact each employee has within the organization. Recognized for value-added contributions to the strategic success of both private and public organizations by combining professional and technical accounting expertise with a common sense approach to business financial practices with team focused results and strategic relationships.

Braden Bjornson, Chief Xperience Officer
Braden Bjornson is a highly accomplished professional with a wealth of experience in project management and enterprise resource planning consulting. With a strong focus on improving business processes and enhancing customer experience, Braden has successfully implemented numerous projects for various companies. In his previous roles, Braden served as Branch Manager for multiple Scotiabank branches across four Canadian provinces, including several rural locations. With a deep understanding of the banking industry, he has demonstrated exceptional leadership skills and a proven track record of success in Agricultural Banking. Additionally, Braden held the position of Project Coordinator at Ocalink Technologies, a rapid COVID-19 response corporation dedicated to manufacturing Emergency Ventilators. In this role, he effectively managed international relationships, facilitated orders, supervised manufacturing processes, and ensured regulatory compliance. Braden's professionalism, expertise, and dedication make him an invaluable asset in any project or organization. With his exceptional project management skills and commitment to delivering high-quality results, Braden consistently exceeds expectations and drives success.

Contact Information

Farstarcap Investment Corp. 
Konstantine Tsakumis 
CEO, Director 
Tel: 604-961-9442 
Email: [email protected] 

HerdWhistle Technologies Inc.
Adam Morand
Director, Investor Relations
(587) 943-4404
Email: [email protected]

This news release does not constitute an offer to sell or a solicitation of an offer to buy any of the securities described herein in the United States. The securities described herein have not been registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act"), or any state securities law and may not be offered or sold in the "United States", as such term is defined in Regulation S promulgated under the U.S. Securities Act, unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration requirements is available.

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.

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

Forward-Looking Statements

Certain statements in this news release are forward-looking statements or information, which include completion of the Transaction and related Concurrent Financing, development of technologies, future plans, regulatory approvals and other matters. Forward-looking statements consist of statements that are not purely historical, including any statements regarding beliefs, plans, expectations or intentions regarding the future. Such information can generally be identified by the use of forwarding-looking wording such as "may", "expect", "estimate", "anticipate", "intend", "believe" and "continue" or the negative thereof or similar variations. The reader is cautioned that assumptions used in the preparation of any forward-looking information may prove to be incorrect. Events or circumstances may cause actual results to differ materially from those predicted, as a result of numerous known and unknown risks, uncertainties, and other factors, many of which are beyond the control of the Company, including but not limited to, business, economic and capital market conditions, the ability to manage operating expenses, security threats, and dependence on key personnel. Such statements and information are based on numerous assumptions regarding present and future business strategies and the environment in which the Company will operate in the future, including the demand for its products, anticipated costs, and the ability to achieve goals. Factors that could cause the actual results to differ materially from those in forward-looking statements include, failure to obtain regulatory approval, the continued availability of capital and financing, litigation, increase in operating costs, the impact of COVID-19 or other viruses and diseases on the Company's ability to operate, failure of counterparties to perform their contractual obligations, government regulations, loss of key employees and consultants, and general economic, market or business conditions. Forward-looking statements contained in this news release are expressly qualified by this cautionary statement. The reader is cautioned not to place undue reliance on any forward-looking information.

There can be no assurance that the Transaction or Concurrent Financing will be completed or, if completed, will be successful.

The forward-looking statements contained in this news release are made as of the date of this news release. Except as required by law, the Company disclaims any intention and assumes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Additionally, the Company undertakes no obligation to comment on the expectations of, or statements made by, third parties in respect of the matters discussed above.

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