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Light AI Inc. — M&A Activity 2024
Dec 20, 2024
46948_rns_2024-12-19_7c4d0e08-9716-4a61-956a-8bfca3cc1ff8.pdf
M&A Activity
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NOTICE OF CHANGE IN CORPORATE STRUCTURE
NATIONAL INSTRUMENT 51-102
This notice is provided pursuant to the requirements of Section 4.9 of National Instrument 51-102 – Continuous Disclosure Obligations.
Item 1: Names of the Parties to the Transaction
The following corporate entities were parties to the Transaction (hereinafter defined):
(a) Mojave Brands Inc. (renamed to Light AI Inc. pursuant to the Transaction) (the “Company”), a company incorporated under the laws of the Province of British Columbia;
(b) Light AI Inc., a company incorporated under the laws of the Province of British Columbia; and
(c) LAI SPV Corp., a company incorporated under the laws of the Province of British Columbia.
Item 2: Description of the Transaction
On December 13, 2024, the Company completed its previously announced acquisition of 100% of the issued and outstanding common shares of the former Light AI Inc. (“LAI”) and changed its name to “Light AI Inc.” (the “Transaction”). The Transaction was effected pursuant to a three-cornered amalgamation whereby the Company’s wholly-owned subsidiary (“Subco”) amalgamated with LAI and LAI SPV Corp. (“Finco”) under the Business Corporations Act (British Columbia) (the “Amalgamation”).
In accordance with the terms and conditions of the Business Combination Agreement dated June 19, 2024, as amended (the “Business Combination Agreement”), entered into among the Company, LAI and Finco, and immediately before the completion of the Amalgamation, all of the convertible debentures of LAI converted into 591,386 common shares of LAI (each, an “LAI Share”).
The amalgamated entity formed pursuant to the Amalgamation is now a wholly-owned subsidiary of the Company (“Amalco”) and the outstanding securities of LAI and Finco were exchanged for securities of the Company immediately before the completion of the Transaction, as follows:
(i) holders of outstanding LAI Shares received 3.89 common shares in the capital of the Company (each, a “Common Share”) for each one LAI Share held (the “LAI Exchange Ratio”) and the LAI Shares were cancelled;
(ii) each issued and outstanding common share purchase warrant of LAI was exchanged, on an equivalent basis after giving effect to the LAI Exchange Ratio, for common share purchase warrants of the Company (each, a “Warrant”);
(iii) each issued and outstanding stock option of Light AI was exchanged, on an equivalent basis after giving effect to the LAI Exchange Ratio, for the stock options of the Company (each, an “Option”);
(iv) holders of outstanding common shares of Finco (each, a “Finco Share”) received one Common Share for each one Finco Share held (the “Finco Exchange Ratio”) and the Finco Shares were cancelled;
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(v) each issued and outstanding common share purchase warrant of Finco was exchanged, on an equivalent basis after giving effect to the Finco Exchange Ratio, for Warrants;
(v) each issued and outstanding stock option of Finco was exchanged, on an equivalent basis after giving effect to the Finco Exchange Ratio, for Options;
(vii) as consideration for the issuance of Common Shares in exchange for the LAI Shares or Finco Shares, Amalco issued to the Company one common share of Amalco for each Common Share so issued; and
(viii) Light AI, Finco and Subco amalgamated and continue as Amalco.
As a result of the Transaction, there are an aggregate of 82,595,471 Common Shares, 7,792,635 Warrants and 7,113,945 Options issued and outstanding.
Pursuant to the terms of the Business Combination Agreement:
- An aggregate of 30,962,054 Common Shares of former LAI shareholders are subject to contractual resale restrictions pursuant to the terms of the Business Combination Agreement;
- An aggregate of 32,434,800 Common Shares of former Finco shareholders are subject to contractual resale restrictions; and
- 9,453,591 Common Shares, 714,500 Warrants and 2,168,675 Options are subject to escrow agreements.
Upon closing of the Amalgamation, each of the directors and officers of the Company resigned from their respective positions, and management of the Company has transitioned to a new management team, led by Peter Whitehead as Chief Executive Officer. In addition, Darren Tindale and Thomas Scarnecchia were appointed Chief Financial Officer and Chief Operating Officer of the Company, respectively. Emmanuel Blin, Hugh Cleland, Mark Attanasio, and Steven Semmelmayer were appointed as directors of the Company.
In connection with the closing of the Transaction, the Company's newly appointed board of directors resolved to change the year end of the Company to coincide with that of LAI.
The Company has applied to delist its Common Shares from the Canadian Securities Exchange ("CSE") and the delisting of the Common Shares is subject to CSE approval. On December 13, 2024, the Company received conditional approval for the listing of the Common Shares on Cboe Canada Inc. ("Cboe") under the ticker symbol "ALGO". The listing of the Common Shares on Cboe is subject to the Company closing the previously announced public offering of units, as detailed in the Company's final prospectus dated December 17, 2024, and Cboe issuing its final exchange bulletin confirming approval for listing of the Common Shares on Cboe.
Item 3. Effective Date of the Transaction
December 13, 2024
Item 4. Names of Each Party That Ceased to be a Reporting Issuer Subsequent to the Transaction and of Each Continuing Entity
The Company did not cease to be a reporting issuer as a result of the Transaction. The Company is a reporting issuer in all provinces and territories, other than Quebec. As described above, the Company is now known as "Light AI Inc."
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Item 5. Date of the Reporting Issuer's First Financial Year-End after the Transaction, if applicable
December 31, 2024
Item 6 The Periods, including comparative periods, if any, of the Interim and Annual Financial Statements Required to be Filed for the Reporting Issuer's First Financial Year after the Transaction, if applicable
The Company is required to file the following interim and annual financial statements after the Transaction, which are based on LAI's (the reverse takeover acquirer) financial year end:
| New Financial Year | Comparative Annual Financial Statements to New Financial Year | Interim Periods for New Financial Year | Comparative Interim Periods to Interim Periods in New Financial Year |
|---|---|---|---|
| January 1, 2024 to December 31, 2024 | January 1, 2023 to December 31, 2023 | March 31, 2025 | March 31, 2024 |
| June 30, 2025 | June 30, 2024 | ||
| September 30, 2025 | September 30, 2024 |
Item 7 Documents Which Were Filed Under National Instrument 51-102 that Describe the Transaction and Where Those Documents Can Be Found In Electronic Format
The following documents describing the Transaction were filed on SEDAR+ and are available on www.sedarplus.ca under the profile for the Company:
(a) the Business Combination Agreement;
(b) news release dated June 20, 2024 announcing the Transaction and the Business Combination Agreement;
(c) the amending agreement dated September 9, 2024 (the "Amending Agreement");
(d) the material change report dated September 9, 2024 regarding the Amending Agreement;
(e) news release dated September 13, 2024 announcing amendment to the Business Combination Agreement;
(f) the second amending agreement dated October 24, 2024;
(g) the investor presentation dated October 29, 2024;
(h) the preliminary prospectus dated October 29, 2024;
(i) news release dated November 1, 2024 announcing the filing of the preliminary prospectus;
(j) news release dated November 21, 2024 announcing the public offering;
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(k) the Certificate of Change of Name dated December 13, 2024;
(l) news release dated December 16, 2024 announcing the closing of the Transaction; and
(m) the final prospectus dated December 17, 2024.
Item 8. Date of Report
December 19, 2024.
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