Meteorite Capital Inc. and Kobo Resources Inc. Announce Closing of Concurrent Financing of $4,676,400 and Provide Update on Qualifying Transaction

Meteorite Capital Inc. Announce Approval of Special Meeting Matters

Not for distribution to United States newswire services or for release publication, distribution or dissemination directly, or indirectly, in whole or in part, in or into the United States.

MONTREAL--(BUSINESS WIRE)--Meteorite Capital Inc. (TSXV: MTR) (“Meteorite” or the “Corporation”) and Kobo Resources Inc. (“Kobo” and, together with Meteorite, the “Companies”) are pleased to announce that further to the news releases dated November 1, 2022, January 17, 2023 and January 25, 2023, the Companies have entered into an amalgamation agreement (the “Amalgamation Agreement”) pursuant to which Meteorite and Kobo have agreed, subject to certain conditions, to complete a transaction that will result in a reverse take-over of Meteorite by the shareholders of Kobo (the “Qualifying Transaction”) and have completed the Concurrent Financing (as defined below) on February 24, 2023, raising aggregate gross proceeds of $4,676,400.

Concurrent Financing

The Companies are pleased to announce that the Companies have completed their previously announced brokered private placement of subscription receipts of Meteorite and Kobo (the “Subscription Receipts”) consisting, in the case of Kobo, of 13,516,400 Kobo Subscription Receipts (as defined below) and, in the case of Meteorite, of 4,969,200 Meteorite Subscription Receipts (as defined below) at a price of $0.25 for total gross proceeds of $4,621,400 (the “Brokered Financing”). The Brokered Financing was led by Leede Jones Gable Inc. (the “Agent”) and was a critical component in completing the Qualifying Transaction. An additional 220,000 Kobo Subscription Receipts were sold on a non-brokered basis (together with the Brokered Financing, the “Concurrent Financing”), for total gross proceeds of $4,676,400.

For the purposes hereof, Subscription Receipts issued by Kobo shall be referred to as “Kobo Subscription Receipts” and Subscription Receipts issued by Meteorite shall be referred to as “Meteorite Subscription Receipts”.

Proceeds of the Concurrent Financing will be held in escrow by TSX Trust Company (the “Subscription Receipt Agent”), until the closing of the Qualifying Transaction and the satisfaction of certain escrow release conditions (collectively, the “Release Conditions”). Each Subscription Receipt will entitle its holder, without payment of any additional consideration and without any further action on the part of the holder thereof and after the closing of the Qualifying Transaction, to receive one post-Consolidation common share of the Resulting Issuer (as defined below) and one-half of one common share purchase warrant of the Resulting Issuer, as applicable (respectively, and each on a post-Consolidation basis, a “Resulting Issuer Share” and a “Resulting Issuer Warrant”). Each Resulting Issuer Warrant shall entitle its holder thereof to purchase one Resulting Issuer Share at an exercised price of $0.40 per Resulting Issuer Share for a period of 24 months following the closing of the Qualifying Transaction.

In the context of the Brokered Financing, the Companies have granted the Agent an option to increase the size of the offering by up to 15%, exercisable in whole or in part at any time within 48 hours of the closing date of the Brokered Financing (the “Agent’s Option”).

The Companies have agreed to pay to the Agent a cash commission of $151,028.00 (the “Agent’s Commission”) equal to 6% of the gross proceeds (including the Agent’s Option) the Brokered Financing, other than gross proceeds originating Kobo’s president's list of subscribers (the “President's List") subscriptions, on which the Agents' Commission was 2% of the gross proceeds the President’s List. Half of the Agent’s Commission was paid at closing of the Brokered Financing, and the remaining Agent’s Commission will be held in escrow and paid at the closing of the Qualifying Transaction. As additional compensation, the Companies agreed to issue to the Agent non-transferable compensation options (the “Agent’s Compensation Options”) equal to 6% of the number of Subscription Receipts sold pursuant to the Brokered Financing (including the Agent’s Option but excluding the President's List). Each Agent’s Compensation Option will be issued on the closing of the Qualifying Transaction and shall entitled the holder to acquire one Resulting Issuer Share and one-half of one Resulting Issuer Warrant, at an exercise price of $0.25 for 24 months after the closing of the Qualifying Transaction. Each Resulting Issuer Warrant underlying the Agent’s Compensation Option shall be exercisable to acquire Resulting Issuer Share at a price of $0.40 per Resulting Issuer Share for a period of 24 months following the closing of the Qualifying Transaction. The Companies have also agreed to pay a cash corporate finance fee of $92,428.00 (the “Cash Corporate Finance Fee”) which is equal to 2% of the gross proceeds (including the Agent’s Option) the Brokered Financing, plus applicable taxes. The portion of the Cash Corporate Finance Fee attributable to the Kobo Subscription Receipts was paid at closing of the Brokered Financing, and the remaining Cash Corporate Finance Fee will be held in escrow and paid at the closing of the Qualifying Transaction. The Companies shall in addition issue warrants (the “Corporate Finance Compensation Options” and together with the Agent’s Compensation Options, the “Compensation Options”) equal to 2% of the number of Subscription Receipts sold pursuant to the Brokered Financing (including the Agent’s Option). The Corporate Finance Compensation Options have the same terms as the Agent’s Compensation Options. In total, 721,312 Compensation Options will be issued at the earlier of the satisfaction of the Release Conditions or March 31, 2023. Other than as set out above, neither Meteorite nor Kobo intends to pay any finder’s fees or commissions in connection with the Qualifying Transaction. For clarity, in accordance with the policies of the TSX Venture Exchange (the “TSXV”), any compensation described above payable in respect of Meteorite Subscription Receipts will only be payable on the closing of the Qualifying Transaction, and shall be held in escrow with the Subscription Receipt Agent until such date.

If the Release Conditions are not met on or before March 31, 2023, then all of the Subscription Receipts will be cancelled and all proceeds will be released escrow and returned to subscribers.

The net proceeds of the Concurrent Financing will be used by the Resulting Issuer to fund (i) the exploration and other expenses relating to the Kossou Gold Project (as defined below), (ii) the expenses of the Qualifying Transaction and the Concurrent Financing, and (iii) the working capital requirements of the Resulting Issuer.

All Subscription Receipts are subject to a Canadian statutory hold period of four months plus one day the closing date of the Concurrent Financing. However, after the Qualifying Transaction, all Resulting Issuer Shares and all Resulting Issuer Warrants underlying the Kobo Subscription Receipt will be freely tradeable. Certain “related parties” of Kobo are participating in the Concurrent Financing and acquired 1,492,400 Kobo Subscription Receipts for $373,100. The participation in the Concurrent Financing of such “related parties” will constitute a “related party transaction” as defined under Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions (Regulation 61-101 respecting Protection of Minority Security Holders in Special Transactions in Quebec), which related party transaction is exempt the formal valuation and minority shareholder approval requirements.

For more information on the Qualifying Transaction, see the press release dated January 17, 2023.

All dollar amounts set forth herein are in Canadian dollars.

Approval of Meteorite Special Meeting Matters

Meteorite is pleased to announce that all matters in connection with the Qualifying Transaction submitted to shareholders for approval as set out in detail in the Corporation’s management information circular dated January 17, 2023 (the “Circular”) were approved at the Special Meeting of Shareholders held on February 7, 2023.

Conditional upon, and effective as of, the completion of the Qualifying Transaction with Kobo, the Corporation’s shareholders:

1. fixed the number of directors to be elected at six to serve the completion of the Qualifying Transaction until the next general meeting of shareholders or until their successors are elected or appointed;
2. elected the following individuals to the board of directors of the Corporation: Charles Spector, Edward Gosselin, Paul Sarjeant, Frank Ricciuti, Patrick Gagnon and Jeff Hussey;
3. approved the stock option plan of the Corporation, as more particularly described in the accompanying proxy circular;
4. approved, by way of special resolution, an amendment to the Corporation’s articles of incorporation to effect a consolidation of the common shares of the Corporation on the basis 0.2 of one new post-consolidation common share of the Corporation for each existing common share; and
5. approved, by way of special resolution, an amendment to the Corporation’s articles of incorporation to change the name of the Corporation “Meteorite Capital Inc.” to “Kobo Resources Inc.” or any such other name as may be accepted by the relevant regulatory authorities and approved by the board of directors of the Corporation.

Amalgamation Agreement

Pursuant to the Amalgamation Agreement, Meteorite will acquire all of the issued and outstanding Kobo Shares in exchange for post-Consolidation common shares of Meteorite and Kobo will amalgamate with a wholly-owned subsidiary of Meteorite by way of a three-cornered amalgamation (the “Amalgamation”), such that Kobo will be a wholly-owned subsidiary of Meteorite as it exists (the “Resulting Issuer”) following the completion of the Amalgamation. Immediately prior to the Amalgamation, Meteorite shall have completed a consolidation of its issued and outstanding common shares (the “Consolidation”) on the basis of 0.2 post- Consolidation Meteorite common shares for every one (1) pre-Consolidation Meteorite common share held.

As a result of the Amalgamation and excluding any securities issuable in connection with the Concurrent Financing (as defined below), Meteorite will issue an aggregate of 56,809,749 Resulting Issuer Shares at a deemed price of $0.20 per share in consideration for the acquisition of all outstanding Kobo Shares. As part of the Amalgamation, all convertible securities of Kobo outstanding immediately prior to the Closing are expected to be replaced with or exchanged for equivalent convertible securities of the Corporation entitling the holders thereof to acquire Resulting Issuer Shares in lieu of Kobo Shares. The Amalgamation will result in the reverse takeover of the Corporation by the Kobo Shareholders and will constitute the Corporation’s Qualifying Transaction, as such term is defined in TSXV policy 2.4.

Completion of the Amalgamation is subject to a number of conditions as set forth in the Amalgamation Agreement, including obtaining all necessary board and regulatory approvals, including TSXV approval.

About Kobo

Kobo is a junior Canadian exploration and mining development company focused on acquiring, exploring and developing gold property assets located in West Africa and primarily in Côte d’Ivoire. Kobo, through its wholly-owned subsidiary, KOBO Ressources Côte d’Ivoire S.A., owns two gold research permits (being the Kossou Permit and the Kotobi Permit) covering 449 km and has three pending applications covering 1,068 km . As at the date hereof, Kobo’s sole material asset is the Kossou Permit, which forms the basis of its Kossou Gold Project (the “Kossou Gold Project”). The Kossou Gold Project is located contiguous to the eastern boundary of the Yaouré Mine operated by Perseus Mining, with key drill targets within 10 km of the Yaouré process facility. With the proceeds of the Concurrent Financing, Kobo intends to commence an 8,500 m RC drill program at the Kossou Gold Project. Drill holes will focus on key targets (RCZ, Jagger and the Contact Zone) along over 9 km of strong gold geochem anomalies previously identified and supported by surface rock sampling and trenching results.

Kobo was incorporated under the Business Corporations Act (Québec) on December 14, 2015 under the name 9333-9141 Québec Inc. On March 4, 2016, Kobo changed its name to Kobo Resources Inc.. Kobo’s head office and registered office are located at 388 Grande-Allée East, Suite 101, Québec, Québec, G1R 2J4.

About Meteorite

Meteorite exists under the provisions of the Canada Business Corporations Act with its registered and head office located at 1 Place Ville Marie, Suite 3900, Montreal, Québec. It is a Capital Pool Company and intends for the Qualifying Transaction to constitute its “Qualifying Transaction” as such term is defined in the TSX.V Policies. Meteorite is a “reporting issuer” within the meaning of the Securities Act of each of the Provinces of British Columbia, Alberta, Ontario and Québec.

Further Information

All information contained in this news release with respect to Meteorite and Kobo was supplied by the parties respectively, for inclusion herein, without independent review by the other party, and each party and its directors and officers have relied on the other party for any information concerning the other party.

For further information regarding the Qualifying Transaction, please contact:

Charles R. Spector, Director, Meteorite Capital Inc.
Telephone: (514) 878-8847
Email: info@Meteoritecapital.com

Edouard Gosselin, Chief Executive Officer and Director, Kobo Resources Inc.
Telephone: 1-418-609-3587
Email: egosselin@kobores.com

Completion of the Qualifying Transaction is subject to a number of conditions, including but not limited to, TSXV acceptance. Where applicable, the Qualifying Transaction cannot close until the required shareholder approval is obtained. There can be no assurance that the Qualifying 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 Qualifying Transaction, any information released or received with respect to the Qualifying 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 TSXV has in no way passed upon the merits of the Qualifying Transaction and has neither approved nor disapproved the contents of this press 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.

CAUTIONARY NOTE REGARDING FORWARD‐LOOKING INFORMATION:

This news release contains “forward-looking information” and “forward-looking statements” (collectively, “forward-looking statements”) within the meaning of the applicable Canadian securities legislation. All statements, other than statements of historical fact, are forward-looking statements and are based on expectations, estimates and projections as at the date of this news release. Any statement that involves discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions, future events or performance (often but not always using phrases such as “expects”, or “does not expect”, “is expected”, “anticipates” or “does not anticipate”, “plans”, “budget”, “scheduled”, “forecasts”, “estimates”, “believes” or “intends” or variations of such words and phrases or stating that certain actions, events or results “may” or “could”, “would”, “might” or “will” be taken to occur or be achieved) are not statements of historical fact and may be forward-looking statements. In this news release, forward-looking statements relate, among other things, to: the terms and conditions of the proposed Qualifying Transaction, Amalgamation and Consolidation; the satisfaction of the Release Conditions before March 31, 2023; the timing for those events and the business and operations of the Resulting Issuer after the proposed Qualifying Transaction. Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable, are subject to kn and unkn risks, uncertainties, and other factors which may cause the actual results and future events to differ materially those expressed or implied by such forward-looking statements. Such factors include, but are not limited to: general business, economic, competitive, political and social uncertainties; and the delay or failure to receive board, shareholder or regulatory approvals. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially those anticipated in such statements. Accordingly, readers should not place undue reliance on the forward-looking statements and information contained in this news release. Except as required by law, Meteorite and Kobo assume no obligation to the forward-looking statements of beliefs, opinions, projections, or other factors, should they change, except as required by law.