Effects of deactivating 300,000 BPC shares

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The Issuer’s Management Board publishes the forecasted percentage changes in connection with the planned reduction in the number of shares in Black Pearl S.A., through their redemption in the number of 300,000 (say: three hundred thousand) from the majority portfolio, currently owned by Janusz Skopowski.

The value of the redeemed shares as at December 23, 2020 is PLN 19,350,000 (in words: nineteen million three hundred and fifty thousand zlotys), at the exchange rate of PLN 64.50. The repurchase will take place for a fixed amount: 1,000,000 units of the virtual currency MCAN coin from the Issuer’s assets.

Because:

The existence of technical possibilities to implement the provisions of the Ordinary General Meeting of Shareholders Resolution No. 17 of 27/06/2019 – regarding the redemption of series G shares, the purpose of which was to restore the Company’s assets.

Specification of the size of the portfolio of shares subject to redemption: 300,000 pieces – valued at the rate of PLN 64.50 per share – as at 23/12/2020, for the total amount: PLN 19,350,000 (in words: nineteen million three hundred fifty thousand zlotys)

Possibility of buying shares from the market and withdrawing them from circulation – by means of and using the Company’s financial instruments, i.e. 1,000,000 units of the digital currency MCAN coin

The Issuer’s Management Board decided to present the effect of the purchase for the purpose of redemption of 300,000 BPC shares in trading, using 1,000,000 units of the virtual currency MCAN. A condition for the redemption of shares purchased by Black Pearl S.A. is the obligation of the Management Board to approve the above transaction at the next General Meeting of Shareholders by adopting a resolution on the redemption of shares.

The transaction amount is the sum in the digital currency: 1,000,000 MCAN coin (in words: one million) in parity up to PLN 19,350,000 (in words: nineteen million three hundred and fifty thousand zlotys) – from the current valuation of 300,000 redeemed shares.

Presentation of economic and financial effects:

The current number of BPC shares is 2,753,380, which corresponds to a proportional number of 2,753,380 votes at the company’s AGM.

Ilość akcji dopuszczonych do obrotu i notowanych na rynku NewConnect wynosi 403.380 sztuk co odpowiada takiej samej ilości głosów. The percentage is equal to 14.98% in relation to the total of 100% of the existing shares – in the amount as above.

Janusz Skopowski holds: 2,205,000 shares , which constitutes 80.08% of shares and votes. The remaining 125,000 shares, representing 4.54% of the total, are fragmented and not admitted to trading on the stock exchange – they are, just like the majority portfolio, outside the stock exchange trading. The total sum of shares outside the stock exchange is 2,330,000, which corresponds to 84.62% of votes.

Janusz Skopowski believes that the valuation of both MCAN coin and BPC shares is market underestimated, therefore after the approval of the redemption of shares – by the General Meeting of Shareholders and the implementation of the resolution in this respect by Black Pearl SA, the amount received in MCAN will be transferred to the statutory purposes of the company Medican Ltd, which he is co-owner, and Medican Ltd will burn 1,000,000 MCAN coins, permanently excluding them from trading – removing them from the crypto chain on which they are registered. This will reduce the amount of BPC stocks and MCAN coin units in existence physically The mutual transaction will be beneficial in all respects to the minority shareholders of Black Pearl S.A.

Substantiation:

Increasing the percentage of shares fragmented and listed on NewConnect. After the redemption of 300,000 shares from Janusz Skopowski’s portfolio, the total number of BPC shares will decrease to 2,453,380 shares, which will constitute a new level of 100%.

However, the number of fragmented shares will remain unchanged 403,380 pieces of fragmented shares – listed, in the hands of small shareholders – will not constitute 14.98% as at present, but will increase and will reach the level of 16.44% of the total number of shares and votes at the General Meeting of Shareholders.

Physically, the total amount of BPC shares will be reduced by 10.9% compared to the current one.

In terms of the portfolio of MCAN coin held by the Issuer, in the amount of 4,418,000,000 pieces – there will be no changes that would directly affect its valuation.

On the other hand, by burning 1,000,000 coins, the number of existing MCAN coins in the blockchain chain will be completely reduced, which is 5,000,000,000. After burning – i.e. deactivation, 4,999,000,000 MCAN coins will remain. It is a move that is very beneficial in terms of image and causes appreciation of currencies listed on the cryptocurrency markets. This will indirectly increase the attractiveness of the MCAN currency in relation to other digital currencies.

The above information is necessary for the shareholders of Black Pearl S.A. to understand the basis and effects of the actions taken by the Management Board.