BTCS Inc. (OTCQB: BTCS) ("BTCS" or the "Company") and Spondoolies-Tech Ltd. ("Spondoolies") have entered into a definitive merger agreement.
Closing of the merger is subject to, among other things, receipt of regulatory approvals and other customary closing conditions.
The agreement has been unanimously approved and adopted by the Boards of Directors of both BTCS and Spondoolies. Under its terms BTCS shareholders will own a 55.4 to 54.4% stake in the combined company and Spondoolies shareholders will own a 44.6 to 45.6% of the combined company, based on the number of common and preferred securities outstanding immediately following the merger. The ownership range is a function of BTCS' liquidation preference associated with its existing $1.5 million investment in Spondoolies. The final ownership percentages will be determined prior to closing.
BTCS, which produced year-over-year growth of 1,155% in earned bitcoins for the first six months of 2015, is a blockchain technology focused company which secures the blockchain through its transaction verification services business. Spondoolies is a transaction verification server manufacturer which announced un-audited revenue of more than $28 million for the 12-months ending December 31, 2014. The merger combines the operational expertise of BTCS' transaction verification services with Spondoolies' industry leading technology.
Charles Allen, Chief Executive Officer of BTCS, commented, "This merger marks a major milestone for us and sets the stage for rapid revenue acceleration in the years ahead. Together we will leverage the respective expertise of both of our companies to create a new global leader in the blockchain sector."
"The blockchain is set to radically change the future of transaction-based industries," stated Guy Corem, Chief Executive Officer of Spondoolies. "BTCS has positioned itself at the core of this disruptive transformation, and we are excited to combine forces to capitalize on the immense opportunities that lie ahead."
Following the merger, Charles Allen will remain the CEO and chairman of the board of the combined company and Yuval Rosen will join the board and be appointed as BTCS' CFO. Guy Corem, Kobi Levin, and Gadi Glikberg, current executives of Spondoolies, will also be appointed officers of the combined company.