iMining Announces Fundamental Acquisition of CanETH Staking Services Inc.

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Vancouver, British Columbia–(Newsfile Corp. – February 3, 2021) – iMining Blockchain and Cryptocurrency Inc. (TSXV: IMIN) (the “Company” or “iMining“) is pleased to announce that it has entered into a letter agreement dated February 2, 2021 (the “Letter Agreement“), with CanETH Staking Services Inc., a private Ontario corporation (“CanETH“), to acquire all the issued and outstanding securities of CanETH (the “Acquisition“). The final structure of the Acquisition is subject to receipt of final tax, corporate and securities law advice for both iMining and CanETH. In addition, the Acquisition is subject to TSX Venture Exchange (“TSXV“) approval.

Terms of the Agreement

Under the terms of the Letter Agreement, and on or prior to the closing date of the Acquisition (the “Closing Date“), the outstanding shares of CanETH (the “CanETH Shares“) shall be reorganized such that they are converted or otherwise exchanged by the holders thereof into or for common shares of iMining (the “iMining Shares“) based on a one-for-one exchange ratio, and iMining shall become the direct or indirect holder of all outstanding CanETH Shares. The holders of any other outstanding convertible, exchangeable or exercisable securities of CanETH shall become entitled to receive iMining Shares upon the conversion, exchange or exercise thereof based on a one-for-one exchange ratio. There are currently 28,000,000 CanETH Shares outstanding and 38,458,265 iMining Shares and 5,556,880 warrants to acquire iMining Shares outstanding. The Acquisition will result in CanETH shareholders owning approximately 42.13% of the Company on an undiluted, pre-Financing (as defined below) basis.

The parties have agreed to undertake commercially reasonable efforts to close the Acquisition on or before April 30, 2021. The Letter Agreement terminates in the event the parties fail to complete the Acquisition on or prior to April 30, 2021, unless extended in writing by the parties.

Conditions for Closing

The Letter Agreement provides that closing of the Acquisition is subject to several conditions including, among other things: (i) receipt of all regulatory approvals, including the TSXV; (ii) requisite corporate approval of the various transactions contemplated by the Acquisition from the directors and shareholders of iMining and CanETH, as applicable and required; and (iii) closing of the Financing for gross proceeds of at least $1,700,000, as described below.

Financing

As previously announced in its news releases dated January 11, 2021 and January 29, 2021, iMining intends to complete a private placement to raise gross proceeds of up to $2,000,000 (the “Financing“), through the issuance of up to 20,000,000 units (the “Units“) at $0.10 per Unit. Each Unit will be comprised of one iMining Share and one-half of one common share purchase warrant (“Warrant”), with each whole Warrant entitling the holder to purchase one iMining Share at a price of $0.15 per share for a period of two years, provided that in the event the closing price of the iMining Shares is equal to or greater than $0.45 per share for 20 consecutive trading days, the Company may, by notice to the Warrant holders (which notice may be by way of general news release), reduce the remaining exercise period of the Warrants to not less than 30 days following the date of such notice.

Proceeds of the Financing will be used toward (i) costs of completing the Acquisition, (ii) to expand CanETH’s business, and (iii) for general working capital purposes.

Business of CanETH

CanETH Staking Services is a Canadian-based company offering a staking solution for Ethereum 2.0, providing clients with a simplified on-ramp to participate in the ETH 2.0 Proof of Stake movement. Incorporating a proprietary, best-in-class staking process CanETH ensures robust security, reliability and scalability; while removing the technical complexity of deploying and managing validators.

For more information on CanETH Staking Services please visit www.caneth.com or email at info@caneth.com.

New Director

Upon the closing of the Acquisitions and the Financing, Mr. Saleem Moosa will be appointed as a new director of iMining. Mr. Moosa is currently the CFO of CanETH. Mr. Moosa started his career in investment banking and has over 12 years of international experience in the financial sector. At Lazard Ltd., (a NYSE listed financial advisor and asset management firm) he was involved in cross-border mergers and acquisition transactions, restructuring mandates and equity raising projects.

Other

The terms of the Acquisition were negotiated at arm’s length. The Acquisition will constitute a fundamental acquisition under TSXV Policy 5.3, and as such it will require approval of the TSXV. As the transaction is arm’s length and there is not expected to be any new control persons created, it is not expected that the shareholders of iMining will be required to approve the Acquisition. Trading of iMining’s Shares on the TSXV has been halted until the earlier of satisfactory review of the proposed transaction by the TSXV, or closing of the transaction.

Both the closing of the Acquisition and the Financing are subject to the approval of the TSX Venture Exchange.

Further details regarding new management, CanETH and its business will follow in subsequent news releases.

ON BEHALF OF THE BOARD

Signed “Robert Eadie
Robert Eadie, Chief Executive Officer and Director

FOR FURTHER INFORMATION PLEASE CONTACT:

Contact: Robert Eadie
Telephone: 1-604-602-4935 ♦ Facsimile: 1-604-602-4936
Email: investor@imining.com
Website: www.imining.com

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

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