DevvStream Holdings Inc. Announces Closing of Bridge Financing
Vancouver, BC, January 12, 2024 – DevvStream Holdings Inc. (the “Company” or “DevvStream”) (Cboe CA: DESG) (FSE: CQ0), a leading carbon credit project co-development and generation firm specializing in technology solutions, is pleased to announce that, further to its news release dated September 13, 2023, it has closed a first round of bridge financings of unsecured convertible notes (the “Notes”) in the aggregate amount of US$500,000 (the “Bridge Financings”).
US$100,000 of the Bridge Financings was completed on the terms described in the Company’s news release dated September 13, 2023. Those Notes will bear interest at a rate of 15% per annum, calculated and payable at maturity or conversion. Immediately prior to the completion of the De-SPAC Transaction (as defined below), the principal amount and interest will automatically convert into subordinate voting shares of DevvStream (“DevvStream Shares”) at a conversion price per DevvStream Share equal to the greater of (a) a 25% discount to the deemed value per DevvStream Share in the Company’s proposed business combination (the “De-SPAC Transaction”) with Focus Impact Acquisition Corp. (“Focus Impact”), as disclosed in Focus Impact’s Current Report on Form 8-K, filed with the Untied States Securities and Exchange Commission on September 13, 2023, and (b) CAD$1.03 (the “Floor Price”). In the event that the De-SPAC Transaction (or other U.S. listing transaction) is not completed within 270 days of the issuance of the Notes (the “Anniversary Date”), the principal amount and interest will automatically convert into units of DevvStream (“Units”) at a conversion price per Unit equal to the greater of (i) the 30-day volume weighted average trading price (“VWAP”) of the DevvStream Shares on the Cboe stock exchange, and (ii) the Floor Price. Each Unit will consist of one DevvStream Share and one-half of a warrant to purchase DevvStream Shares at an exercise price equal to a 20% premium to the 30-day VWAP (subject to the Floor Price) until two years from the Anniversary Date.
An additional US$100,000 of Bridge Financing was completed on similar terms as described above, but with the following amendments (the “Amended Notes”). The Amended Notes will bear interest at a rate of 5.3% per annum, calculated and payable at maturity or conversion and will become due and payable on the date that is 12 months after the date of issuance (the “Maturity Date”), subject to acceleration if the Company completes the De-SPAC Transaction. They will carry the same conversion terms as described above, provided that conversion is at the option of the holder and will not be automatic. Devvio, Inc. (“Devvio”), the Company’s controlling shareholder, was the investor in this portion of the Bridge Financing.
An additional US$300,000 of Bridge Financings was completed on similar terms as the Amended Notes, but with the following amendments. These Notes will use a conversion price per DevvStream Share that is a 25% discount to a 20-day VWAP. The Floor Price to be used in connection with the completion of the De-SPAC Transaction will be US$2.00, and the Floor Price to be used if the De-SPAC Transaction is not completed will be CAD$0.475. Focus Impact Partners, LLC, an affiliate of Focus Impact, was the investor in this portion of the Bridge Financing for US$300,000. Additional amounts may be advanced by Focus Impact Partners, LLC, on these terms prior to completion of the De-SPAC Transaction, subject to the prior approval of the Cboe Canada Inc. stock exchange.
The proceeds of the Bridge Financings will be used for general working capital purposes and other opportunities to fund the growth of the Company.
The participation of Devvio in the Bridge Financing constitutes a “related party transaction” within the meaning of Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions (“MI 61-101”). The Company intends to rely upon exemptions from the formal valuation and minority approval requirements of MI 61-101.
Founded in 2021, DevvStream is a leading authority in the use of technology in carbon project development. The Company’s mission is to create alignment between sustainability and profitability, helping organizations achieve their climate initiatives while directly improving their financial health. With a pipeline of over 140 technology-based projects worldwide, DevvStream makes it simple for corporations and governments to address their net-zero goals while generating premium carbon credits in the process. DevvStream takes a programmatic approach to evaluating project opportunities, and co-develops projects spanning energy-efficient buildings, facilities and homes, industrial facilities, LED systems, EV charging stations, and technologies to seal oil wells. The Company’s end-to-end proprietary solution removes the risk and complexity from every step, allowing organizations to move from project ideation to credit monetization with ease. The result is a multi-year stream of carbon credit revenue that transforms sustainability into a financial investment. In addition, for organizations that need help to offset their most difficult-to-reduce emissions, we also provide premium carbon credits for purchase.
On September 13, 2023, DevvStream and Focus Impact (Nasdaq: FIAC) announced that they have entered into a definitive business combination agreement for a business combination that would result in the combined company (DevvStream) to be listed on the Nasdaq Stock Market under the ticker symbol “DEVS”. On December 11, 2023, DevvStream announced the filing of a registration statement on Form S-4 with the U.S. Securities and Exchange Commission, which contains a preliminary proxy statement/prospectus in connection with the De-SPAC Transaction. Upon closing, the De-SPAC Transaction is expected to result in DevvStream being the first publicly-traded carbon credit company on a major U.S. stock exchange.
About Focus Impact Acquisition Corp.
Focus Impact Acquisition Corp. is a newly organized blank check company formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses.
Certain statements in this news release may be considered forward-looking statements. Forward-looking statements are statements that are not historical facts and generally relate to future events or DevvStream’s future financial or other performance metrics. In some cases, you can identify forward-looking statements by terminology such as “may”, “should”, “expect”, “intend”, “will”, “estimate”, “anticipate”, “believe”, “predict”, “potential” or “continue”, or the negatives of these terms or variations of them or similar terminology. These forward-looking statements, including, without limitation DevvStream’s expectations with respect to future performance and anticipated financial impacts of the Bridge Financings and De-SPAC Transaction are subject to risks and uncertainties, which could cause actual results to differ materially from those expressed or implied by such forward-looking statements. These forward-looking statements are based upon estimates and assumptions that, while considered reasonable by DevvStream and its management, are inherently uncertain and subject to material change. New risks and uncertainties may emerge from time to time, and it is not possible to predict all risks and uncertainties. certain other risks are identified and discussed in. Factors that may cause actual results to differ materially from current expectations include, but are not limited to: (1) the occurrence of any event, change or other circumstances that could give rise to the termination of negotiations and any subsequent definitive agreements with respect to the De-SPAC Transaction; (2) the outcome of any legal proceedings that may be instituted against Focus Impact, DevvStream, the combined company or others; (3) the inability to complete the De-SPAC Transaction due to the failure to obtain approval of the stockholders of Focus Impact and DevvStream or to satisfy other conditions to closing; (4) changes to the proposed structure of the De-SPAC Transaction that may be required or appropriate as a result of applicable laws or regulations; (5) the ability to meet Nasdaq’s or another stock exchange’s listing standards following the consummation of the De-SPAC Transaction; (6) the risk that the De-SPAC Transaction disrupts current plans and operations of Focus Impact or DevvStream as a result of the announcement and consummation of the De-SPAC Transaction; (7) the ability to recognize the anticipated benefits of the De-SPAC Transaction, which may be affected by, among other things, competition, the ability of the combined company to grow and manage growth profitably, maintain relationships with customers and retain its management and key employees; (8) costs related to the De-SPAC Transaction; (9) changes in applicable laws or regulations; (10) the possibility that Focus Impact, DevvStream or the combined company may be adversely affected by other economic, business, and/or competitive factors; (11) estimates of expenses and profitability and underlying assumptions with respect to stockholder redemptions and purchase price and other adjustments; (12) various factors beyond management’s control, including general economic conditions and other risks, uncertainties and factors set forth in the section entitled “Risk Factors” and “Cautionary Note Regarding Forward-Looking Statements” in the Registration Statement on Form S-4 that includes a proxy statement and prospectus of Focus Impact (as may be amended from time to time, the “Registration Statement”), filed with the SEC on December 4, 2023, and other filings with the SEC; and (13) certain other risks identified and discussed in DevvStream’s Annual Information Form for the year ended July 31, 2023, and DevvStream’s other public filings with Canadian securities regulatory authorities, available on DevvStream’s profile on SEDAR at www.sedarplus.ca.
These forward-looking statements are expressed in good faith, and DevvStream believes there is a reasonable basis for them. However, there can be no assurance that the events, results or trends identified in these forward-looking statements will occur or be achieved. Forward-looking statements speak only as of the date they are made, and DevvStream is not under any obligation, and expressly disclaims any obligation, to update, alter or otherwise revise any forward-looking statement, whether as a result of new information, future events or otherwise, except as required by law. Readers should carefully review the statements set forth in DevvStream’s public filings with Canadian securities regulatory authorities. This news release is not intended to be all-inclusive or to contain all the information that a person may desire in considering an investment in DevvStream and is not intended to form the basis of an investment decision in DevvStream. All subsequent written and oral forward-looking statements concerning DevvStream, the proposed transaction or other matters and attributable to DevvStream or any person acting on DevvStream’s behalf are expressly qualified in their entirety by the cautionary statements above.
Additional Information and Where to Find It
In connection with the De-SPAC Transaction, Focus Impact and DevvStream have prepared, and Focus Impact has filed with the SEC, the Registration Statement containing the proxy statement/prospectus with respect to the combined company’s securities to be issued in connection with the De-SPAC Transaction, a proxy statement with respect to the stockholders’ meeting of Focus Impact to vote on the De-SPAC Transaction and certain other related documents. Investors, securityholders and other interested persons are urged to read the preliminary proxy statement/prospectus in connection with Focus Impact’s solicitation of proxies for its special meeting of stockholders to be held to approve the De-SPAC Transaction (and related matters) and general amendments thereto and the definitive proxy statement/prospectus, when available, because the proxy statement/prospectus contains important information about Focus Impact, DevvStream and the De-SPAC Transaction. Once the Registration Statement is declared effective, Focus Impact will mail the definitive proxy statement/prospectus and other relevant documents to its stockholders as of a record date to be established for voting on the Business Combination. This communication is not a substitute for the Registration Statement, the definitive proxy statement/prospectus or any other document that Focus Impact will send to its stockholders in connection with the De-SPAC Transaction. Once the Registration Statement is declared effective, copies of the Registration Statement, including the definitive proxy statement/prospectus and other documents filed by Focus Impact or DevvStream with the SEC, may be obtained, free of charge, by directing a request to Focus Impact Acquisition Corp., 250 Park Avenue, Suite 911, New York, New York 10177. The preliminary and definitive proxy statement/prospectus to be included in the Registration Statement, once available, can also be obtained, without charge, at the SEC’s website (www.sec.gov). Additional details relating to the De-SPAC Transaction will also be available in the management information circular to be provided to shareholders of DevvStream to seek approval of the De-SPAC Transaction. Once mailed to the shareholders of DevvStream it will also be filed under DevvStream’s profile on SEDAR at www.sedarplus.ca.
Participants in the Solicitation
Focus Impact and its directors, executive officers, other members of management, and employees, may be deemed to be participants in the solicitation of proxies of Focus Impact's stockholders in connection with the De-SPAC Transaction under SEC rules. Information regarding the persons who may, under SEC rules, be deemed participants in the solicitation of Focus Impact's stockholders in connection with the De-SPAC Transaction is available in the Registration Statement and the proxy statement/prospectus included therein. To the extent that holdings of Focus Impact's securities have changed since the amounts printed in Focus Impact's registration statement on Form S-1 relating to its initial public offering, such changes have been or will be reflected on Statements of Change in Ownership on Form 4 filed with the SEC. Investors and security holders may obtain more detailed information regarding the names and interests in the De-SPAC Transaction of Focus Impact's directors and officers in Focus Impact's filings with the SEC and in the Registration Statement, which includes the proxy statement/prospectus of Focus Impact for the De-SPAC Transaction.
DevvStream and its directors and executive officers may also be deemed to be participants in the solicitation of proxies from the stockholders of Focus Impact in connection with the De-SPAC Transaction. A list of the names of such directors and executive officers and information regarding their interests in the De-SPAC Transaction are included in the proxy statement/prospectus of Focus Impact for the De-SPAC Transaction. You may obtain free copies of these documents as described above.
No Offer or Solicitation
This news release is for informational purposes only. This news release shall not constitute a solicitation of a proxy, consent or authorization with respect to any securities or in respect to the transactions described herein. This news release shall also not constitute an offer to sell or the solicitation of an offer to buy any securities of Devvstream, Focus Impact or the combined company following the De-SPAC Transaction, nor shall there be any sale of securities in any states or jurisdictions in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. The securities described herein have not been registered under the U.S. Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements.
On Behalf of the Board of Directors,
Chief Executive Officer
DevvStream Media Contacts
DevvStream@icrinc.com and email@example.com
Phone: (332) 242-4316