GlobalBlock to Sell Digital Asset Broker Business

London, United Kingdom and Vancouver, British Columbia--(Newsfile Corp. - March 23, 2023) - GlobalBlock Digital Asset Trading Limited (TSXV: BLOK) (OTC Pink: BLVDF) (FSE: BD4) (the "Company") announces that it has entered into a Business Disposition Agreement dated March 22, 2023 (the "Agreement") with GlobalBlock Ltd. ("GB UK") and the original shareholders and founders of GB UK (the "GB UK Founders") to transfer GB UK and its digital asset broker business back to the GB UK Founders (the "Disposition Transaction"). In return, the GB UK Founders will return to the Company the 48,450,000 common shares of the Company collectively held by them (which shares were originally issued to the GB UK Founders when the Company acquired GB UK in 2021). The Disposition Transaction is considered a non-arm's length transaction because it involves "Non-Arm's Length Parties" (as defined by the TSX Venture Exchange (the "Exchange")).

The Company has determined that given the current environment surrounding digital assets and the expense and restrictions surrounding the operation of a digital asset broker business inside of a publicly listed entity, the digital asset broker business being operated by GB UK and its subsidiaries would best be served outside of a publicly listed entity. As a result, the GB UK Founders have agreed under the Disposition Transaction to privatize that business, and the Company will be seeking alternative transactions and businesses to acquire or combine with.

Key Terms of the Disposition Transaction

• At the closing of the Disposition Transaction (the "Closing"), the Company will sell all of the shares of GB UK to the GB UK Founders in exchange for return of 48,450,000 common shares of the Company collectively held by the GB UK Founders.

• The Agreement sets forth how the assets, liabilities and obligations of the Company and GB UK and its business are to be dispersed or transferred amongst the Company and GB UK effective as of December 31, 2022, including the split of cash and liabilities, and the obligations of each of the Company and GB UK going forward. The Company and GB UK have agreed to split on a 50/50 basis: (i) the cost of the Company's current CFO until the term of his consulting agreement expires, (ii) the cost of preparation of the Company's audited financial statements for the year ended December 31, 2022, and (iii) the costs of the Disposition Transaction.

• At Closing, David Thomas will resign as CEO and a director of the Company and Patrick Bullman will resign as a director of the Company.

• At Closing, the Company will provide a £150,000 loan facility (the "Loan Facility") to GB UK to assist with the transitionary phase and support GB UK's business opportunities. The Loan Facility will be a non-revolving loan with a 12-month maturity date and will bear interest at a rate equal to the prime rate plus 2.0% per annum. If the Loan Facility is not repaid on its specified repayment date, then the Loan Facility shall remain outstanding, and GB UK shall be required to issue to the Company that number of its ordinary shares that would result in the Company holding 5% of the issued and outstanding ordinary shares of GB UK (on a fully diluted basis). If the Loan Facility is not repaid within six (6) months of the repayment date, then the Loan Facility shall remain outstanding, and GB UK will be required to issue to the Company that number of additional ordinary shares such that the Company holds 10% of the issued and outstanding ordinary shares of GB UK (on a fully diluted basis).

• The Disposition Transaction is subject to usual conditions to Closing, but also includes the following conditions to Closing:

  • holders of options to acquire up to 1.5 million common shares of the Company (those holders being David Thomas, Patrick Bullman and certain employees of GB UK) will have entered into agreements to terminate those options held by them; and

  • dissent rights in connection with the Disposition Transaction shall not have been validly exercised (and not withdrawn) with respect to more than 1% of the issued and outstanding common shares of the Company.

Following completion of the Disposition Transaction, the Company's remaining assets will be cash and the blockchain patents it acquired in February 2021. Accordingly, the Company will need to identify and, if successful, acquire or combine with a new business. The Company has discussed the Disposition Transaction with the Exchange and the Exchange has advised that after the completion of the Disposition Transaction, the Company's listing may be transferred to the NEX Board of the Exchange until the Company is able to so acquire or combine with a new business.

Upon completion of the Disposition Transaction, the Company will need to identify and appoint a new Chief Executive Officer and at least one (1) additional director.

Additional Details of the Disposition Transaction

Disposition of All or Substantially All the Property of the Company

The Disposition Transaction involves the disposition of GB UK and its digital asset broker business, which is substantially all of the Company's property. As such, the Company is required to obtain the affirmative vote of at least two-thirds of the votes cast by the shareholders of the Company present at a special meeting of the shareholders (the "Meeting") in person or represented by proxy and entitled to vote at the Meeting, pursuant to section 301 of the Business Corporations Act (British Columbia) ("BCBCA").

Pursuant to the BCBCA, any registered holders of the Company' shares have a right to dissent ("Dissenting Right"). Each dissenting shareholder is entitled to be paid the fair value of all, but not less than all, of the holder's shares, provided that the holder duly dissents to the Disposition Transaction and the Disposition Transaction is approved by the required shareholders' approval.

Related Party Transaction

The GB UK Founders, as parties to the Disposition Transaction, each hold more than 10% of the issued and outstanding common shares of the Company. As such, the Company is also required to obtain the affirmative vote of a majority of the shareholders of the Company present at the Meeting in person or represented by proxy, excluding any votes attached to shares of the Company beneficially owned by the GB UK Founders or over which the GB UK Founders exercise control or direction and any other person who has a material interest in the Disposition Transaction, pursuant to Multilateral Instrument 61-101 - Protection of Minority Security Holders in Special Transactions.

Special Committee

To ensure that the interests of the Company were fairly considered in the negotiation and review of the Disposition Transaction and to manage the conflicts of interest that may arise in the context of the Disposition Transaction, the independent directors of the Company, who do not have a financial interest in the Disposition Transaction, oversaw the evaluation and negotiation of the Disposition Transaction on behalf of the Company.

TSX Venture Exchange Approval

The Disposition Transaction is also subject to approval from the Exchange due to the fact that it involves the disposition of all or substantially all of the property of the Company and a transaction with a party related to the Company.

Additional Information

The Company will issue additional news releases related to the Disposition Transaction and other material information as it becomes available.

ABOUT THE COMPANY

GlobalBlock Digital Asset Trading Limited is a publicly traded holding company (TSXV: BLOK) whose wholly-owned operating subsidiary, GlobalBlock Europe, UAB (https://www.globalblock.eu), is a European Union based digital asset broker that provides a personalised telephone brokerage service, trading platform and mobile app. Following completion of the Disposition Transaction, the Company will not have any operating business due to the sale of GB UK. Accordingly, the Company will need to identify and, if successful, acquire or combine with a new business.

For further information please contact the Company at:

David Thomas, CEO
c/o 65 Curzon Street, London, W1J 8PE, United Kingdom
Tel. +44 20 3307 3795
[email protected]
https://globalblock.eu/ and http://www.globalblockdigital.com/
https://twitter.com/Globalblocknews
https://www.linkedin.com/company/globalblock/

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

Certain information set out in this news release constitutes forward-looking statements or information. Forward-looking statements are often, but not always, identified by the use of words such as "seek", "anticipate", "plan", "continue", "estimate", "expect", "may", "will", "intend", "could", "might", "should", "believe" and similar expressions. In particular, this news release contains forward-looking statements in respect of among other things: the structure, terms, conditions and proposed timing for completion of the Disposition Transaction; the ability of the Company to complete the Disposition Transaction; the receipt of all necessary shareholder, TSX Venture Exchange and other third party consents and approvals; and the ability of the Company to successfully identify and complete the acquisition of or combination with a new business. Forward-looking statements are based upon the opinions and expectations of management of the Company as at the effective date of such statements and, in certain cases, information provided or disseminated by third parties. Although the Company believes that the expectations reflected in such forward-looking statements are based upon reasonable assumptions, and that information obtained from third party sources is reliable, they can give no assurance that those expectations will prove to have been correct. Readers are cautioned not to place undue reliance on forward-looking statements included in this document, as there can be no assurance that the plans, intentions or expectations upon which the forward-looking statements are based will occur. By their nature, forward-looking statements involve numerous assumptions, known and unknown risks and uncertainties that contribute to the possibility that the predictions, forecasts, projections and other forward-looking statements will not occur, which may cause actual results in future periods to differ materially from any estimates or projections of future performance or results expressed or implied by such forward-looking statements. These risks and uncertainties include, among other things, risk factors set forth in the Company's most recent management's discussion and analysis, a copy of which is filed on SEDAR at www.sedar.com, and readers are cautioned that the risk factors disclosed therein should not be construed as exhaustive. These statements are made as at the date hereof and unless otherwise required by law, the Company does not intend, or assume any obligation, to update these forward-looking statements.

Neither the TSX Venture Exchange nor its Regulation Service 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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