Gstaad Capital Corp. Announces Execution of Amalgamation Agreement with Claranova Technologies Inc. and Closing of First Tranche of Concurrent Financing

Executive Summary

• Gstaad Capital Corp. entered into a definitive amalgamation agreement with Claranova Technologies Inc., creating the post‑transaction issuer “Illumisoft Corp.” and positioning it as a Tier 2 Technology Issuer on the TSX Venture Exchange.
• The deal includes a concurrent non‑brokered private placement (“First Tranche”) of 11,723,251 Subscription Receipts at $0.30 each, raising $3,516,975.30; total target proceeds are up to $7,000,000.20 for 23,333,334 receipts.
• Upon completion (subject to regulatory and shareholder approvals), the resulting capital structure will consist of approximately 47.48 M Resulting Issuer Shares and 425,390 Finder Warrants, with ownership split roughly 3.96% Gstaad shareholders, 46.89% Claranova shareholders, and 49.15% financing subscribers.

Key Details

• Amalgamation Structure
• Gstaad securities will be consolidated at a 0.2‑to‑1 exchange ratio; each pre‑consolidation Gstaad share converts to one post‑consolidation share of the Resulting Issuer.
• All outstanding Subscription Receipts convert to one Resulting Issuer Share each.

• Claranova shares convert on a 1‑for‑1 basis to Resulting Issuer Shares.

• Pre‑Closing Capitalization (post‑Consolidation)

• ~1,881,667 Gstaad Shares outstanding.
• Up to 23,333,334 Subscription Receipts outstanding.

• 22,261,805 Claranova Shares outstanding.

• Post‑Effective Time Capitalization (assuming maximum financing)

• 47,476,806 Resulting Issuer Shares issued and outstanding.

• 425,390 non‑transferable Finder Warrants issued to finders (price $0.30 per share, exercisable until the second anniversary of closing).

• Ownership Percentages After Closing

• Gstaad shareholders: ~3.96% of Resulting Issuer Shares.
• Claranova shareholders: ~46.89%.

• Financing subscribers: ~49.15%.

• Transaction Pricing

• Deemed transaction price: C$0.35 per Resulting Issuer Share (based on post‑consolidation Gstaad share price).

• Consideration for Claranova Shares: C$7,791,631.75.

• Concurrent Financing – First Tranche

• Issue of 11,723,251 Subscription Receipts at $0.30 each, gross proceeds $3,516,975.30.

• Total financing target: up to $7,000,000.20 for 23,333,334 receipts.

• Use of Proceeds

• Funds placed in escrow; released upon satisfaction of Escrow Release Conditions (completion of Amalgamation, regulatory approvals, no material amendment to agreement).

• Net proceeds earmarked for business activities of the Resulting Issuer and general working capital.

• Escrow & Refund Mechanism

• If conditions are not met by 5:00 p.m. Vancouver time on 2026‑02‑28, or the transaction is terminated, subscription receipt holders will be refunded their purchase price plus a pro‑rata share of accrued interest.

• Finder Compensation

• Cash fees to finders: $127,617.02 (paid from escrowed proceeds).

• Issuance of 425,390 Finder Warrants (exercise price $0.30 per share).

• Regulatory & Shareholder Conditions

• Required approvals: TSX Venture Exchange acceptance, BCBCA regulatory approvals, shareholder votes for Gstaad and Claranova, adoption of a new equity incentive plan, completion of the Concurrent Financing, and absence of a Material Adverse Effect.

• Related Party Disclosures

• Director Ehsan Agahi holds 5.55% of Claranova Shares; other directors hold additional stakes (total ~15%). No single party exceeds 10% ownership post‑transaction.

• Proposed Board & Management of Resulting Issuer

• Directors: Ehsan Agahi, Brett Nicholds, Michael Johnson, Ryan Adam, Cameron Groome.

• Executive team: Brett Nicholds (CEO), Ali Pickett (CFO), Michael Johnson (CTO), David W. Smalley (Corporate Secretary).

• Loan to Claranova

• Unsecured loan of $25,000 (interest‑free) repayable on termination of the Amalgamation Agreement; no further loans anticipated pre‑closing.

• Sponsorship & Waiver

• Gstaad will seek a waiver from TSX Venture Exchange sponsorship requirements under Policy 2.2; no guarantee of approval.

• Financial Snapshot – Illumisoft (Claranova’s operating subsidiary)

• FY2024 revenue: C$1,273,888; FY2023 revenue: C$956,263.

• Net loss before tax FY2024: C$(469,116); nine‑month unaudited loss (ended Apr 30 2025): C$(525,302).

• Risk & Forward‑Looking Statements

• Completion of the Amalgamation and financing is subject to multiple conditions; no assurance that the transaction will close.
• Investors cautioned on speculative nature of securities and potential for material deviations from forward‑looking expectations.