nDivision, Inc. signed a binding letter agreement to acquire 22 Capital Corp. (TSXV:LFC.P) in a reverse merger transaction on July 24, 2017. 22 Capital will acquire all of the issued and outstanding common shares of nDivision in exchange for an aggregate of 42.2 million shares of 22 Capital after giving effect to a 2.4 for one share consolidation. In connection with the transaction, each shareholder of nDivision will receive one-half of one post-consolidation share and one-half of one restricted share for each nDivision share then held, resulting in the issue to such shareholders of nDivision of 21.1 million post-consolidation shares and 21.1 million restricted shares. Under the terms, one-half of one Consolidated Share and one-half of one restricted share to be issued by 22 Capital in exchange for 0.355 of an nDivision Share pursuant to the transaction. The restricted shares shall have full voting rights on all matters other than with respect to the election of directors. As a condition of the transaction, all of the options are required to be exercised prior to the completion of the transaction. Upon completion of the consolidation and the exercise of the options, and immediately prior to the closing of the transaction, 22 Capital will have 4.6 million post-consolidation shares issued and outstanding, together with an aggregate of 0.23 million broker warrants exercisable at a price of CAD 0.24 per post-consolidation share until May 10, 2019. Prior to the completion of the transaction, 22 Capital will complete a private placement of 1.1 million common shares, as such shares exist following the consolidation at a price of CAD 0.45 per post-consolidation share for aggregate gross proceeds of CAD 0.5 million. Up to 0.28 million securities (CAD 0.13 million) may be purchased by insiders of 22 Capital in connection with the offering. Upon completion of the transaction it is expected that the shareholders of 22 Capital will hold approximately 9.7% of the equity of the combined entity, purchasers in the offering will hold approximately 2.3% of the equity of the combined entity and the shareholders of nDivision will hold approximately 88% of the equity of the combined entity. The name of the combined entity will be approved by nDivision and will be changed to nDivision Technology Group Inc. upon acceptance of applicable regulatory authorities. It is expected that upon completion of the transaction the Board of Directors of the combined entity will consist of eight Directors. The Board of Directors of the Resulting Issuer will be comprised of: Alan Hixon (Chairman), Justin Roby, Bradley Wiggins, Mike Beavers, Dennis J. Cagan, H. William Gordon, Sean McIlrath and Larry King. In addition, it is expected that Alan Hixon will serve as President and Chief Executive Officer and Vic Hugo will serve as Chief Financial Officer and Corporate Secretary of the Resulting Issuer. Brad Wiggins is expected to operate as Chief Administrative Officer, Justin Roby is expected to operate as Chief Technology Officer and Mike Beavers is expected to operate as Chief Commercial Officer of the combined entity. Upon completion of the transaction, it is the intention of the parties that the combined entity will continue to focus on the current business and affairs of nDivision and will be a Tier 2-listed Technology Issuer on the TSXV. The transaction is subject to approval by shareholders of nDivision, approval of the directors of each of 22 Capital and nDivision, completion of the private placement, exercise of 22 Capital's options, completion of due diligence investigations, signing of definitive agreement and all requisite regulatory approvals relating to the transaction, including, without limitation, TSXV approval, the approval of any third parties from whom nDivision must obtain consent including any lenders or financial institutions, licensors and strategic partners, 22 Capital restricted shares issued in consideration for the nDivision shares shall be issued as fully paid and non-assessable shares in the capital of the 22 Capital, management nominees of nDivision shall have been duly appointed as the management of 22 Capital as of the time of closing of the transaction. The parties acknowledge that a portion of 22 Capital restricted shares to be issued as part of the transaction will be subject to escrow provisions which shall be imposed by the policies of the TSXV. Since the transaction is an arm’s length transaction, 22 Capital is not required to obtain shareholder approval for the transaction. 22 Capital intends to hold a special meeting of shareholders to approve certain matters ancillary to the transaction, including, among other items, a name change, the consolidation, an amendment to its articles to create a class of restricted shares, the election of the directors of the combined entity and the continuance, if required. In connection with the transaction, 22 Capital completed the financing on September 12, 2017, pursuant to which 22 Capital issued CAD 0.5 million of subscription receipts. TSX Trust Company acted as transfer agent and registrar for 22 Capital. nDivision, Inc. cancelled the acquisition of 22 Capital Corp. (TSXV:LFC.P) in a reverse merger transaction on January 23, 2018. In connection with the transaction, 22 Capital previously completed a non-brokered private placement of 2.7 million subscription receipts for aggregate gross proceeds of CAD 0.5 million will w be returned to the holders of the subscription receipts on a pro rata basis, and all subscription receipts will be automatically terminated without any further action on the part of such holders.