Akerna Corp. KERN will merge with Gryphon Digital Mining, Inc. in an all-stock deal. Simultaneously with the closing of the merger with Gryphon, Akerna will sell its software business to POSaBIT Systems Corporation POSAF PBIT, a provider of payments infrastructure in the cannabis industry.
Gryphon, a net carbon-neutral bitcoin miner, will be merging with Akerna by way of an agreement and plan of merger to create an ESG-committed, carbon-neutral bitcoin miner. POSaBIT will be acquiring MJ Freeway, including MJ Platform and Leaf Data System brands, and Ample Organics.
About the Proposed Transactions:
In connection with the two transactions, Akerna entered into two separate definitive agreements.
The first definitive agreement is a securities purchase agreement for the sale of Akerna’s MJ Freeway and Ample Organics business units to POSaBIT for $4 million in cash. In connection with the closing of the proposed sale transaction, Akerna plans to use the proceeds of the transaction, after expenses, to pay its remaining outstanding accounts payable and pay down any remaining principal balance on its outstanding senior secured convertible notes, net of $500,000 retained for outstanding obligations and net cash requirements associated with the proposed merger between Akerna and Gryphon.
The second definitive agreement is an agreement and plan of merger, pursuant to which Gryphon will become a wholly-owned subsidiary of Akerna in an all-stock transaction. Upon completion of the proposed merger, on a pro forma basis and based upon the number of Akerna shares to be issued in the proposed merger, current Gryphon equity holders are expected to own approximately 92.5% of the combined company and current Akerna equity holders are expected to own approximately 7.5% of the combined company. The combined company is expected to continue to be publicly traded on Nasdaq.
Upon closing of the proposed merger, Akerna Corp. will be renamed Gryphon Digital Mining, Inc., and will be headquartered in Las Vegas, Nevada. Rob Chang will serve as CEO of the combined company. The merger agreement provides that the board of directors of the combined company will comprise of seven members of which a minimum of five will be filled upon completion of the merger, one designated by Akerna, being Jessica Billingsley, its current CEO, and the remaining six positions to be designated by Gryphon.
Akerna shares were trading 18.53% lower at $1.4501 per share at the time of writing Friday morning.
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