RDARS Inc. entered into a letter of intent to acquire A-Labs Capital II Corp. (TSXV:ALAB.P) in a reverse merger transaction CAD 14.1 million on October 1, 2020. The transaction will proceed based on a deemed price per common share of A-Labs Capital II Corp. of approximately CAD 0.14 before taking into account the proposed Consolidation subject to a downward adjustment to the deemed price per share in the event that A-Labs Capital II Corp working capital at closing of the transaction is less than CAD 50,000. The aggregate share consideration payable by A-Labs Capital II Corp pursuant to the Transaction will be based upon the valuation of RDARS, on a partially-diluted basis pursuant to the concurrent financing on a pre-money basis.

If the transaction is completed, the common shareholders of RDARS will each receive, RDARS common share held immediately prior to the completion of the transaction, such number of post-consolidation common shares of A-Labs Capital II Corp based on the exchange ratio. Furthermore, in connection with closing, the convertible securities of RDARS outstanding immediately prior to closing will either automatically adjust in accordance with their terms or will be replaced with equivalent convertible securities of A-Labs Capital II Corp, with necessary adjustment to number and price to account for the exchange ratio. Either party may terminate the letter of intent if, among other things, the definitive agreement has not been entered into by January 15, 2021.

The letter of agreement is subject to entering into definitive agreement by November 16, 2020. Upon completion of the transaction, A-Labs Capital II Corp will change its name to such name to be determined by RDARS. In connection with closing of the transaction, it is expected that the current directors and officers of A-Labs Capital II Corp will resign from their respective positions and the board will be reconstituted with five directors who shall be nominated by RDARS. As of November 12, 2020, A-Labs Capital II and RDARS entered into an amendment to the Letter agreement to extend the date by which the definitive agreement is to be entered into by A-Labs Capital II and RDARS from November 16, 2020 to December 15, 2020. As of December 21, 2020, A-Labs Capital II Corp. announced that it has extended the term of its previously announced letter of intent with RDARS Inc. and continues to work toward negotiating and entering a definitive agreement on or about January 15, 2021.

Closing of the transaction is conditional upon, receipt of all required regulatory, corporate, and third party approvals, including exchange approval, the negotiation and execution of the Definitive Agreement, satisfactory due diligence by both A-Labs Capital II Corp and RDARS, completion of the Bridge Financing and Concurrent Financing, and, if required by the exchange, filing of a sponsorship report with the exchange.