DR. PHONE FIX CANADA CORPORATION (FORMERLY AUKA CAPITAL CORP.) ANNOUNCES COMPLETION OF QUALIFYING TRANSACTION

CALGARY, AB, March 6, 2025 /CNW/ - Dr. Phone Fix Canada Corporation (formerly Auka Capital Corp.) (TSXV: DPF) (the "Company" or the "Resulting Issuer") is pleased to announce that it has completed its previously announced qualifying transaction in accordance with the TSX Venture Exchange (the "Exchange") Policy 2.4 – Capital Pool Companies (the "Transaction"). The Transaction was completed pursuant to the terms of a business combination agreement dated July 16, 2024 between Auka Capital Corp. ("Auka") and Dr. Phone Fix Canada Limited ("DPF").

The Transaction

The Transaction was completed by way of three-cornered amalgamation whereby Auka and 2629911 Alberta Inc. ("Auka Subco"), a wholly-owned subsidiary of Auka, amalgamated under the laws of the Province of Alberta (the "Amalgamation"). Immediately following the completion of the Amalgamation, Auka changed its name from "Auka Capital Corp." to "Dr. Phone Fix Canada Corporation". Pursuant to the terms of an amalgamation agreement between DPF, Auka and Auka Subco dated March 5, 2025, each outstanding common share of DPF was exchanged for 11.4402330114547 common shares (the "Exchange Ratio") of the Resulting Issuer. The amalgamated entity is a wholly-owned subsidiary of the Company. Further details regarding the Transaction can be found in the filing statement dated November 14, 2024 and filed under the Company's profile on SEDAR at www.sedar.com (the "Filing Statement").

Final acceptance of the Transaction will occur upon the issuance of the final exchange bulletin by the TSXV (the "Final Exchange Bulletin"). Subject to final acceptance by the Exchange, the Company will be classified as a Tier 2 Issuer pursuant to Exchange policies. It is anticipated that common shares of the Resulting Issuer (the "Resulting Issuer Shares") will commence trading on the Exchange under the symbol "DPF" at the opening of markets on or about March 10, 2025.

DPF Financing

As previously announced on February 21, 2025, DPF completed a brokered private placement of subscription receipts (the "Subscription Receipts") of DPF, at a price per Subscription Receipt of $1.37 (the "DPF Financing") resulting in the issuance of an aggregate of 2,216,063 Subscription Receipts for aggregate gross proceeds of approximately $3,036,000. In connection with the completion of the Transaction, each Subscription Receipt was automatically exchanged for one unit ("Unit") comprised of one common share of DPF ("DPF Common Share") and one-half of one DPF Common Share purchase warrant (each whole warrant, a "DPF Warrant"), each DPF Warrant entitling the holder to acquire, after closing of the Transaction, 11.4402330114547 Resulting Issuer Shares, subject to adjustments in certain events, at a price of approximately $0.20 per Resulting Issuer Share for a period of 24 months following the date of issuance thereof. On a post-Exchange Ratio basis, a total of 25,352,261 Resulting Issuer Shares were issued to holders of Subscription Receipts upon closing of the Transaction at a deemed price per Resulting Issuer Share of $0.12.

As consideration for the services of Canaccord Genuity Corp. as lead agent of the DPF Financing (the "Agent") commissions and fees were paid in the manner set out in the Company's press release dated July 16, 2024, with a total of 68,571 warrants to purchase Units ("Agent Warrants"), at a price of $1.83 per Unit at any time up to 24 months following the date of issuance, issued to the Agent.

Upon the satisfaction of the escrow release conditions on March 5, 2025, each Subscription Receipt was automatically exchanged, for no additional consideration, into one DPF Common Share. Each DPF Common Share issued upon conversion of the Subscription Receipts was exchanged, on completion of the Transaction, for one Resulting Issuer Share on the basis the Exchange Ratio. The net proceeds of the DPF Financing relating to the Subscription Receipts were released from escrow on March 5, 2025.

Following the completion of the Transaction, the former shareholders of DPF (including those investors under the DPF Financing) hold a significant majority of the outstanding Resulting Issuer Shares. There are currently 158,375,194 Resulting Issuer Shares outstanding following completion of the Transaction and DPF Financing, comprised of, immediately after closing of the Transaction:

• 12,500,000 Resulting Issuer Shares held by shareholders of Auka immediately prior to closing;
• 25,352,261 Resulting Issuer Shares issued to prior holders of DPF Subscription Receipts;
• 45,522,940 Resulting Issuer Shares issued to creditors of DPF who, in connection with the transaction, converted approximately $5.5 million in DPF debt into DPF Common Shares prior to closing the Transaction (the "DPF Debt Conversion");
• 74,999,993 Resulting Issuer Shares issued in exchange for DPF Shares excluding those issued to Subscription Receipt holders and for DPF Common Shares issued in connection with the DPF Debt Conversion.

For additional information about the Company and the Transaction, please refer to the Filing Statement

Escrowed Shares

In connection with the Transaction, the Company entered into a Tier 2 Value Security Escrow Agreement (the "Value Security Escrow Agreement") with TSX Trust Company, as escrow agent, ("Escrow Agent") and certain Principals (as defined in the policies of the Exchange) of the Resulting Issuer in respect of 122,846,283 Resulting Issuer Shares (the "Value Security Escrowed Shares") to be held in escrow in accordance with Policy 5.4 – Escrow, Vendor Consideration and Resale Restrictions of the Exchange ("Policy 5.4"). 3,450,000 of such Value Security Escrowed Shares were previously subject to the CPC Escrow Agreement. Under the terms of the Value Security Escrow Agreement, 10% of such escrowed securities will be released upon the issuance of the Final Exchange Bulletin with subsequent releases of 15% of such escrowed securities occurring every 6 months following the date of the Final Exchange Bulletin.

Prior to the Transaction, certain shareholders of Auka Capital Corp. entered into a CPC Escrow Agreement (the "CPC Escrow Agreement") with Auka Capital Corp. and the Escrow Agent in respect of 6,490,000 Resulting Issuer Shares held by such shareholders. Upon completion of the Transaction, 3,040,000 Resulting Issuer Shares remain subject to the CPC Escrow Agreement. Under the terms of the CPC Escrow Agreement, 25% of such escrowed Resulting Issuer shares will be released upon the issuance of the Final Exchange Bulletin with subsequent releases of 25% of such escrowed Resulting Issuer Shares occurring 6, 12 and 18 months following the date of the Final Exchange Bulletin.

Board of Directors and Executive Management

Certain directors and officers of Auka Capital Corp. have resigned from their positions upon completion of the Transaction. The following individuals will subsequently comprise the directors and officers of the Company:

• Piyush Sawhney – Chief Executive Officer and Director
• Sunil Goel – President and Director
• Anil Verma– Vice President, Store Development and Director
• Jason Vandenberg – Chief Financial Officer
• Frank Sur – Corporate Secretary and Director
• Graham Barr –Director
• Jay Baraniecki – Director
• Robert Cole – Director
• Jeff Lloyd – Director

Legal Advisors

Gowling WLG (Canada) LLP were legal advisors to Auka Capital Corp. and BARR LLP were legal advisors to DPF.

Auditors

EBT Chartered Professional Accountants was appointed as auditors of the Company upon closing of the Transaction.

For further information, please refer to the Filing Statement posted to the Company's issuer profile on SEDAR at www.sedar.com.

About Dr. Phone Fix Canada Corporation

DPF is an award-winning, eco-friendly, customer-centric growth leader in Canada's cell phone and electronics repair and pre-owned resale industry. Founded in 2019, DPF operates a nationwide network of 35 corporately owned cell phone and electronics repair stores. In addition to its repair services, DPF sells certified pre-owned devices and a wide selection of accessories. DPF has well established networks to acquire and resell a wide variety of used and refurbished electronic devices from certified vendors.

https://www.docphonefix.com/ 

NEITHER THE TSXV NOR ITS REGULATION SERVICES PROVIDER (AS THAT TERM IS DEFINED IN THE POLICIES OF THE TSXV) ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS NEWS RELEASE.

This news release does not constitute an offer to sell or the solicitation of an offer to buy any securities in any jurisdiction.

Cautionary Statement Regarding Forward-Looking Information

This news release contains "forward-looking information" within the meaning of applicable securities laws. Forward-looking information can be identified by words such as: "intend", "believe", "estimate", "expect", "may", "will" and similar references to future periods. Examples of forward-looking information include, among others, the future plans of the Company, the expected trading date of the Resulting Issuer Shares on the TSXV, as well as information relating to the Company. Although the Company believes that, in light of the experience of its officers and directors, current conditions and expected future developments and other factors that have been considered appropriate, the expectations reflected in this forward-looking information are reasonable, undue reliance should not be placed on them because the Company can give no assurance that they will prove to be correct. Readers are cautioned to not place undue reliance on forward-looking information. Actual results and developments may differ materially from those contemplated by these statements depending on, among other things, the risks (i) that the future plans of the Company may differ from those that currently are contemplated; and (ii) that the expected trading date of the Resulting Issuer Shares may change. Additional risks include those disclosed in the Filing Statement, which are incorporated herein by reference and are available through SEDAR at www.sedar.com. The forward-looking statements contained in this news release are made as of the date hereof, and the Company undertakes no obligation to update publicly or revise any forward-looking statements or information, except as required by law.

SOURCE Dr. Phone Fix Canada Corporation (formerly Auka Capital Corp.)

For additional information please contact: Piyush Sawhney, Chief Executive Officer, Dr. Phone Fix Canada Corporation, Email: [email protected]