Posted by AGORACOM-JC
at 10:54 AM on Monday, June 3rd, 2019
Canadian pot edibles, topicals market worth $2.7B: Deloitte
Armina Ligaya, The Canadian Press
Canadian market for next-generation cannabis products is worth an estimated $2.7 billion annually, with edibles contributing more than half, according to a new report from Deloitte.
TORONTO — The Canadian market for next-generation cannabis products is worth an estimated $2.7 billion annually, with edibles contributing more than half, according to a new report from Deloitte.
This spending once the final edible pot regulations roll out in the
coming months is expected to be on top of the roughly $6-billion
estimated domestic market for recreational and medical cannabis, the
consultancy said Monday.
Consumers are looking to snap up these new pot products in addition
to the dried flower, oils, plants and seeds they have been buying from
legal retailers since legalization last fall, a recent survey of 2,000
Canadians conducted by Deloitte suggests.
The first wave of legalization last October was quite limited in
terms of product range and the type of consumer, said Jennifer Lee,
Deloitte Canada’s cannabis national leader.
“When we legalize in October again for edibles, we are in a world
where the formats and the assortment is much broader,” she said. “The
use cases are much broader.”
Canada is gearing up to legalize cannabis-infused foods, beverages,
topicals and other next-generation products in the coming months, once
Ottawa rolls out the final regulations.
Pot companies, as well as food and beverage makers, have been
preparing to roll out their own pot-infused products which they
anticipate will appeal to a broader audience — particularly those who
aren’t interested in smoking weed.
The federal government wrapped up its consultation on the draft
edible rules in February, and has said the regulations must be brought
into force no later than Oct. 17, 2019.
Deloitte estimates that roughly $1.6 billion will be spent on edibles
in Canada, followed by cannabis-infused beverages at $529 million and
topicals at $174 million. Spending on concentrates is expected to hit
$140 million, followed by tinctures at $116 million and capsules at $114
million.
Roughly half of likely edible users surveyed by Deloitte say they
plan to consume gummy bears, cookies, brownies or chocolate at least
every three months.
The global market for alternative cannabis products is expected to
nearly double over the next five years, the consultancy added.
Lee doesn’t expect these new products to eat into revenues from existing categories in Canada, at least in the early days.
“Over time, in the long term, you may,” she said. “But right now,
there’s too much demand in the market and there’s not enough product.”
Legal pot retailers, both government and privately owned, have been
contending with a shortage of cannabis since legalization last October,
but have said the situation has improved in recent months.
For example, the Alberta government lifted its moratorium on new cannabis retail licences, citing an increase in the pot supply.
Deloitte’s market estimates for cannabis 2.0 products reflect overall
Canadian consumer demand, but realizing the market’s full potential too
may take some time. Many of the new pot products may not be available,
or available in sufficient quality, come October, Deloitte said.
Companies should take a three- to five-year view on the market, said Lee.
“The regulations will need time to settle, even after legalization in October,” she said.
While this presents a growth opportunity for companies readying
themselves for the next wave of the green rush, it may come at the
expense of sales in more established industries.
“Our research is showing that the occasions that consumers use the
product, i.e. mostly edibles, overlap a lot with alcohol … On a
limited wallet, there are going to be tradeoffs,” Lee said.
As well, consumers view topical cannabis products such as lotions
used for ailments such as pain as a potential replacement for other
medicinal products, Deloitte’s survey showed.
“This could be cause for concern for the traditional pharmaceutical
sector, as 45 per cent of current consumers and 48 per cent of likely
consumers say they see cannabis topicals as an alternative to
prescription medications, not a complement,” Deloitte said in the
report.
Deloitte surveyed 2,000 adult Canadians online between Feb. 26 and March 11.
According to the polling industry’s generally accepted standards,
online surveys cannot be assigned a margin of error because they do not
randomly sample the population.
Cannabis Canada is BNN Bloomberg’s in-depth
series exploring the stunning formation of the entirely new – and
controversial – Canadian recreational marijuana industry. Read more from
the special series here and subscribe to our Cannabis Canada newsletter to have the latest marijuana news delivered directly to your inbox every day.
Posted by AGORACOM-JC
at 9:47 AM on Monday, June 3rd, 2019
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Big banks are launching a blockchain trade platform powered by ‘Bitcoin-like’ token
The financial giants have poured over $60 million into the new company, called Fnality International.
The token, which has been in the works for four years now, will function both as a payment device and a “messenger that carries all the information required to complete a trade,†according to the report.
Story by: Mix
The banking industry wants to blockchain too
The banking industry is hell-bent on taking over the nascent
blockchain and cryptocurrency market. A group of financial firms led by
UBS Group AG is eyeing blockchain technology for settling cross-border
trades worldwide with its own “Bitcoin-like†token.
The 14 firms – including Barclays, Nasdaq, Credit Suisse Group, Banco
Santander, ING, and Lloyds Banking Group – have registered a new entity
to control the devleopment of the token, dubbed ‘utility settlement
coin’ (or USC for short), The Wall Street Journal reports
The financial giants have poured over $60 million into the new
company, called Fnality International. The token, which has been in the
works for four years now, will function both as a payment device and a
“messenger that carries all the information required to complete a
trade,†according to the report.
The new permissioned
blockchain system will purportedly make cross-border trades much faster
and less risky. “You remove settlement risk, the counterparty risk, the
market risk,†UBS investment strategy head Hyder Jaffrey told the WSJ.
“All of those risks add up to costs and inefficiencies in the
marketplace.â€
In addition to the previously mentioned institutions, Bank of New
York Mellon Corp., Canadian Imperial Bank of Commerce , State Street
Bank & Trust Co., Commerzbank AG, KBC Group NV, Mitsubishi UFG
Financial Group Inc., and Sumitomo Mitsui Banking Corp have also agreed
to use the USC token.
The new platform is expected to take off within the next 12 months, which corroborates past reports suggesting the platform will be fully operational by 2020.
It remains to be seen if USC is more of a cryptocurrency than JP Morgan’s token, though.
Posted by AGORACOM-JC
at 9:14 AM on Monday, June 3rd, 2019
Syndicate of agents led by Haywood Securities Inc. and including Echelon Wealth Partners Inc, under which the Agents have agreed to offer for sale units of the Company,
On a “best effort†private placement basis, subject to all required regulatory approvals, at a price per Unit of $0.27 for total gross proceeds of up to approximately $5,000,000
VANCOUVER, British Columbia, June 03, 2019 – Good Life Networks Inc. (GOOD:TSX.V) (“GLN†or the “Companyâ€), is pleased to announce that it has entered into a letter of engagement with a syndicate of agents led by Haywood Securities Inc. and including Echelon Wealth Partners Inc. (together, the “Agents“), under which the Agents have agreed to offer for sale units of the Company (the “Unitsâ€), on a “best effort†private placement basis, subject to all required regulatory approvals, at a price per Unit of $0.27 (the “Offering Priceâ€), for total gross proceeds of up to approximately $5,000,000 (the “Offeringâ€). Each Unit shall consist of one common share of the Company (a “Shareâ€) and one-half of one common share purchase warrant (each whole warrant, a “Warrantâ€). Each Warrant shall entitle the holder thereof to acquire one Share at a price of $0.35 for a period of 24 months following the closing of the Offering.
The Company has granted the Agents an over-allotment option to offer
for sale up to an additional $1,000,000 of Units at the Offering Price,
exercisable in whole or in part, at any time on or prior to 48 hours
prior to the closing of the Offering.
In the event that, after the date that is six months following the
closing of the Offering, the closing trading price of the Shares on the
TSX Venture Exchange (the “TSXVâ€) is at or above $0.90
per Share for a period of 20 consecutive trading days, the Company may
accelerate the expiry date of the Warrants by giving notice to the
holders thereof and in such case the Warrants will expire on the 30th
day after the date on which such notice is given by the Company.
The Company intends to use the net proceeds of the Offering for working capital and general corporate purposes.
Subscribers will be subject to a statutory hold period that extends
four (4) months plus one (1) day from the closing of the Offering.
The closing date of the Offering is scheduled to be on or about June
20, 2019 and is subject to certain conditions including, but not limited
to, the receipt of all necessary approvals, including the approval of
the TSXV and the applicable securities regulatory authorities.
The GLN Story
GLN’s patent pending technology is the engine that sits between
advertisers and publishers. A highlight of GLN’s tech is that it does
not collect PII (Personal Identifiable Information). Built for cross
device video advertising: Mobile, In-App, Desktop and CTV (Connected
Television) the GLN Programmatic Video Advertising Platform has among
the lowest fraud rates of similar vendors in the industry. Advertisers
make more money by reaching their target audience more effectively. GLN
makes money by retaining a percentage of the advertiser’s fee.
GLN is headquartered in Vancouver, Canada with offices in Newport
Beach and Santa Monica California, New York and UK and trades on the
TSXV under the stock symbol “GOOD†and The Frankfurt Stock Exchange
under the stock symbol 4G5. For further information on the Company,
visit www.glninc.ca
Neither the TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in the policies of the TSX Venture
Exchange) accepts responsibility for the adequacy or accuracy of this
release.
Forward-looking statements
Except for the statements of historical fact, this news release
contains “forward-looking information” within the meaning of the
applicable Canadian securities legislation that is based on
expectations, estimates and projections as at the date of this news
release. “Forward-looking information” in this news release includes
information about the proposed Offering, the anticipated closing date of
the Offering and the Company’s use of proceeds of the Offering and
other forward-looking information.
Factors that could cause actual results to differ materially from
those described in such forward-looking information include, but are
not limited to, the Offering may not close on the terms and timing
anticipated, or at all; and the Company will not obtain TSXV approval of
the Offering.
The forward-looking information in this news release reflects the
current expectations, assumptions and/or beliefs of the Company based
on information currently available to the Company. In connection with
the forward-looking information contained in this news release, the
Company has made assumptions about the Company’s ability to close the
Offering, including obtaining TSXV approval. The Company has also
assumed that no significant events occur outside of the Company’s normal
course of business. Although the Company believes that the assumptions
inherent in the forward-looking information are reasonable,
forward-looking information is not a guarantee of future performance and
accordingly undue reliance should not be put on such information due to
the inherent uncertainty therein.
GLN does not assume any obligation to update the forward-looking
statements, or to update the reasons why actual results could differ
from those reflected in the forward-looking statements, unless and until
required by applicable securities laws. Additional information
identifying risks and uncertainties is contained in GLN’s filings with
the Canadian securities regulators, which filings are available at
www.sedar.com.
EdTech Start-up Business: Scope & Opportunity in India
The start-up of EdTech or Educational Technology was quite simple. Computers helped in teaching arithmetic and some grammar to young school students. The concept was elementary. And it happened long before the internet had invaded our home. With the internet, modern devices and highly sophisticated software available at every nook & corner
The start-up of EdTech or Educational Technology was quite simple.
Computers helped in teaching arithmetic and some grammar to young school
students. The concept was elementary. And it happened long before the
internet had invaded our home.
With the internet, modern devices and highly sophisticated software
available at every nook & corner of even the semi-developed cities
in India. Now, the scope of reach of education has widened like never
before. The impact of Edtech on education, society in general, is
amazing. And this sector as a business opportunity is within the grasp
of all aspiring start-ups.
What is EdTech?
“A picture is worth a Thousand words.â€
With technology being introduced in the field of education, you would
find audios, videos and 3D animation, instead of that Picture. This has
made learning far more dynamic and interactive.
To define simply, any technology that supports education is EdTech.
Today, we don’t imagine school as only a blackboard, a teacher and
some desks. Present day student receives and uploads homework
assignments on the school portal. The rise in EdTech start-up has meant
that they can practice Mathematics online, understand the Biology images
using 3D techniques. Quick and accurate checks help in enhancing the
performance of the students. Such has been the rise in educational
technology.
The true essence of EdTech lies in using technological advances to
improve the education system. It facilitates learning and improves
performance by creating and managing appropriate technology tools.
EdTech Start-ups have changed Learning to e-Learning.
Scope of EdTech Start-up
When every moment of our daily life is being shaped by technology,
then how can education be any different? Technology is making a huge
impact in the field of education as well.
Over the past few years, you must have noticed the immense growth of
EdTech start-up. The companies which started-up in EdTech, even a few
years ago, have gained ground. They have managed to touch unfathomable
heights in business.
A leading example is BYJU’s, the EdTech and Online Tutoring Firm
started up in 2011. In March 2019, it was the world’s most valued
EdTech company at $5.4 billion (Rs 37,000 crore), according to
Wikipedia.
Due to all these developments, people are finding it worth to invest in this innovative new concept.
EdTech start-ups are transforming lives and reinventing businesses.
To provide more data and numbers:
India stands at 145 out of the 191 countries on the Education Index, as per UN,
Its rank is 168 out of 234 countries as per UNESCO with a literacy rate of 72%,
India is ranked at 72 out of the 73 countries considered by OECD.
If you are an aspiring entrepreneur, this data might mean an exciting opportunity for you.
Scope in India
“We, Indians have always had a fixation with education.â€
Any country’s education needs can be met by the government up to a
certain level. Unless innovation is introduced, all systems end up
eventually. This is where entrepreneurship comes in. To bring a
freshness of ideas into the system. India has a whole industry in
education. In waiting for entrepreneurs to take advantage of their
opportunities.
In the year 2016, the Indian Education Industry was valued at $100
billion. This is expected to almost double by 2020 to $180 billion. The
increase in literacy rate and digital learning would be instrumental in
this growth. EdTech itself was estimated at $2 billion. The School
segment consists of primary and secondary school education. This forms
52% of the education industry. This segment offers the biggest
opportunities for development.
Education, including EdTech, has seen a rise in funding. While 4-5
years ago, the annual investment was approx US$20 million. However, the
total funding has seen an extraordinary hike. It has been forecasted as
exceeding US$ 180 million for the year 2020.
Viewing this data, you won’t be surprised to know that major
investors from all over the world are paying close attention to the
developments in Indian EdTech start-up scenario. Some have already
jumped in the fray. In the private sector, Tata Consultancy Service
(TCS) has teamed up with IIM, to give you one example.
The government has also accepted its importance.
Funding for your EdTech start-up may come from both private and
government sources. For example Start-Up India. This is a program by the
Central Government. It has been set up with the objective to promote
start-ups by providing easier bank loans. Another initiative is Atal
Innovation Mission or AIM. It seeks to promote entrepreneurship. Then
there is the Swayam initiative. A program that is planned to offer about
200 e-courses and another 10,000 e-courses under the AICTE.
Some important foreign players are also entering the market. They are
investing to support EdTech start-up. They are Goldman Sachs, Times
Internet, Mark Zuckerberg’s investment fund, to name a few.
Important Factors to Consider
“Every Path to Success is riddled with Challenges.â€
Incorporating an EdTech company and making your start-up work may not
be as smooth as it seems. You may face many difficulties with
your EdTech start-up. For instance, if you are thinking of setting up an
institution supporting school education, an endorsement from school may
boost your start-up to succeed. But the question is how do you get that
necessary endorsement? For that, you may need to prove to them that you
would add value to their brand as well.
On the roadway to success, you will find yourself faced with many
such challenges and mistakes. And you would need to encounter those.
You must strategise your entrance into the EdTech Start-up market. You would need to team up with some technology specialists. You can choose to collaborate with educators. You may follow tips from experts. Of course, a great way to start will be thinking up a new and unique idea.
Below we suggest some strategies and ideas that you may want to
follow to succeed in this highly competitive world of EdTech Start-ups:
Identify your Niche: The first step will be to identify
what exact problem your EdTech Start-up will be solving. This Solution
Statement will clearly suggest your niche. What field do you want to
cater to the education sector?
The Hierarchy for your EdTech Start-up: Before getting company registration
for your business, each promoter/founder must be clear about their
roles, authorities, responsibilities and respective share in the
business. Deciding on these unavoidable and awkward topics first hand
would give each one of you a sense of security. It leads to better
involvement. And avoid many complications in future.
Learn from Others: Join some community of entrepreneurs
from the same field. Get exposed to the work style of other EdTech
directors. More the number, better the exposure and learning. Evaluate
which one is suitable for yourself. Which one would be easiest for you
to adapt to? Develop a mix and refined to suit your business. You may
also make friends. So they would share their personal experiences. The
challenges they must have faced and how they could overcome them.
Proximity to the Audience: You should place yourself
near to a good educational institution. A university would be best. You
can take help of the university students to help you would in project
completions, undertake researches and other initial tasks. With their
innovative ideas, you can test your concept on them.
Testing: The product or service get tested by real
testing. Presenting your product in the real market is the actual test.
No matter how good your team is, some mistakes do slip by. The Beta
Testing will check what errors have been ignored. It will also test the
viability of your product.
Quality: The quality of the services you would be
providing is a key factor to consider. Even if the technology you use is
cutting edge, it would still be very difficult for your EdTech Start-up
to succeed if you do not support it with great educational content.
Building the Team: The core of an EdTech Start-up is
technology. It needs to be kept up-to-date. Regular upkeep is an
important factor for success. To serve this purpose you would need a
strong and stable technology team. The team should not only be hired on
the basis of their existing skill set and qualifications. They must also
have the eagerness to learn and improve themselves. They should be
proactive enough to work out solutions to problems. The work culture of a
start-up is different from that of the corporates that have been
running for some time. You are responsible to hire responsible persons
for the success of your EdTech Start-up. They should be willing
to adjust according to the demands.
Keep Room to Upgrade: All innovative ideas are a work
in progress. No product is final. There is always room for improvement
and upgrade. Once your course has been launched, try to listen to the
customers. Later you can incorporate those new ideas, features and needs
into your course. This way your course will get better. Therefore, it
is advisable not to spend too much time in going live with your product.
Keep improving it periodically to keep it up-to-date with the current
latest technology.
Sales & Marketing: The sales of your product must
reach the required level as anticipated at the start. You need to spread
the word about your new EdTech Start-up on various media platforms. You
may need to keep a separate fund out of the budget for the marketing.
Keep evaluating the sales numbers frequently. Keep revising and
improving on the sales and marketing plans.
Keep on learning: Knowledge and education keep
evolving. And because you have decided to start your business as an
educational institution, you must never get tired of learning. This will
keep you updated with the latest trends in technology. Many sources are
available online as well. The technology gets upgraded almost daily. So
try to use the best and the latest one for your business.
“Learning is a Continuous Process.â€
Make adjustments: You may have planned very carefully
the operations and growth of your business. But some circumstances may
come up causing you to change or drop out. You may get faced with
certain situations right at the time when you feel all has been set and
your business is ready to fly. be adaptable. The EdTech practices keep
changing and you may need to adjust accordingly. It may be financial,
strategic, legal or a change in the business model.
“Change is inevitable.â€
Funding: Funding is the primary concern for all
enterprises. Many great ideas have not taken shape because they didn’t
have the backing of sufficient funds. To incorporate an innovative idea
in your EdTech Start-up, you should try to connect with various sources.
The single funding source can put restrictions on some of the workable
ideas. Sometimes, the source may not be able to provide financial help,
as frequently as required.
Don’t lose sight of your Goal: You have decided to
start a business in the sector which shapes the future. Be it the
student, her family, those who are connected to her. Those who will
connect to her in the future. Remember to keep the values of teaching
intact. The virtuosity will also give a boost to your business. Because
you are adding not only qualifications to a resume but moulding a
person.
Work on the Feedbacks: You must keep a way of receiving
feedback open in your product. You can invite other educators to try
out your products, apps, tools. You can also provide teachers with
Professional Development courses. This will assist them in using your
technology. Their feedback may prove to be invaluable to the survival of
your start-up. You should work to take regular feedback from the
students and the teacher. And work to improve your product. If users are
satisfied then they’ll be encouraged to use and recommend your product.
Posted by AGORACOM-JC
at 10:16 AM on Friday, May 31st, 2019
Announced that the CEO, Mr. Photis Peter Pascali, had increased his beneficial ownership in the Company to 52.82% from 50.37%, an increase of approximately 2.5%.
MONTREAL, May 31, 2019 — PyroGenesis Canada Inc. (http://pyrogenesis.com) (TSX-V: PYR) (OTCQB: PYRNF) (FRA: 8PY), a high-tech company, (the “Company”, the “Corporation†or “PyroGenesis”) a Company that designs, develops, manufactures and commercializes plasma atomized metal powder, plasma waste-to-energy systems and plasma torch products, wishes to clarify today, due to numerous inquiries, the transaction that took place yesterday wherein it was announced that the CEO, Mr. Photis Peter Pascali, had increased his beneficial ownership in the Company to 52.82% from 50.37%, an increase of approximately 2.5%.
As this transaction involved the CEO, a significant investor in the
Company, the Company was obliged to issue an early warning report which
regretfully has caused confusion.
In the transaction, Mr. Pascali acquired 3,385,715 Common Shares, plus Warrants for C$1,862,143.25.
The Company would like to clarify the fact that this was not a
private placement, no money was received by the Company and no new
shares or warrants were issued by the Company.
It was announced that Mr. Pascali acquired the Common Shares and
Warrants for investment purposes and may, from time to time, acquire or
dispose of ownership or control or direction over some or all of the
existing securities or over additional securities of PyroGenesis.
PyroGenesis Canada Inc., a high-tech company, is the world leader in the design, development, manufacture and commercialization of advanced plasma processes and products. We provide engineering and manufacturing expertise, cutting-edge contract research, as well as turnkey process equipment packages to the defense, metallurgical, mining, advanced materials (including 3D printing), oil & gas, and environmental industries. With a team of experienced engineers, scientists and technicians working out of our Montreal office and our 3,800 m2 manufacturing facility, PyroGenesis maintains its competitive advantage by remaining at the forefront of technology development and commercialization. Our core competencies allow PyroGenesis to lead the way in providing innovative plasma torches, plasma waste processes, high-temperature metallurgical processes, and engineering services to the global marketplace. Our operations are ISO 9001:2015 and AS9100D certified, and have been since 1997. PyroGenesis is a publicly-traded Canadian Corporation on the TSX Venture Exchange (Ticker Symbol: PYR) and on the OTCQB Marketplace. For more information, please visit www.pyrogenesis.com.
This press release contains certain forward-looking statements,
including, without limitation, statements containing the words “may”,
“plan”, “will”, “estimate”, “continue”, “anticipate”, “intend”,
“expect”, “in the process” and other similar expressions which
constitute “forward- looking information” within the meaning of
applicable securities laws. Forward-looking statements reflect the
Corporation’s current expectation and assumptions and are subject to a
number of risks and uncertainties that could cause actual results to
differ materially from those anticipated. These forward-looking
statements involve risks and uncertainties including, but not limited
to, our expectations regarding the acceptance of our products by the
market, our strategy to develop new products and enhance the
capabilities of existing products, our strategy with respect to research
and development, the impact of competitive products and pricing, new
product development, and uncertainties related to the regulatory
approval process. Such statements reflect the current views of the
Corporation with respect to future events and are subject to certain
risks and uncertainties and other risks detailed from time-to-time in
the Corporation’s ongoing filings with the securities regulatory
authorities, which filings can be found at www.sedar.com, or at www.otcmarkets.com. Actual
results, events, and performance may differ materially. Readers are
cautioned not to place undue reliance on these forward-looking
statements. The Corporation undertakes no obligation to publicly update
or revise any forward- looking statements either as a result of new
information, future events or otherwise, except as required by
applicable securities laws.
Neither the TSX Venture Exchange, its Regulation Services
Provider (as that term is defined in the policies of the TSX Venture
Exchange) nor the OTCQB accepts responsibility for the adequacy or
accuracy of this press release.
Posted by AGORACOM-JC
at 10:03 AM on Friday, May 31st, 2019
Combination to create leading publicly traded esports and
gaming organization with $22 million in pro forma revenue and $36
million in cash on closing of the merger, with combined global audience
reach of approximately 200 million
Merged assets and reach to include seven esports teams
(including management of the Vancouver Titans Overwatch League
franchise), 40 esports influencers, 80+ gaming media websites, 900+
YouTube and Twitch channels
Enthusiast Gaming’s extensive media network and gamer data,
combined with Luminosity’s championship calibre teams and brand equity,
expected to drive further audience growth
Strategically positioned to leverage Luminosity’s robust
esports brand and its audience through Enthusiast Gaming’s monetization
and ad tech platform
TORONTO, May 31, 2019 (GLOBE NEWSWIRE) — Enthusiast Gaming Holdings Inc. (TSXV: EGLX) (“Enthusiast Gaming†or the “Companyâ€) is pleased to announce that it has entered into an arrangement agreement (the “Arrangement Agreementâ€) dated May 30, 2019 with J55 Capital Corp. (TSXV: FIVE) (“J55â€) and Aquilini GameCo Inc. (“GameCoâ€), a private Canadian company to form the leading publicly traded esports and gaming media organization in North America.
Menashe Kestenbaum, CEO of Enthusiast Gaming commented, “Our
vision has always been to build the largest, vertically integrated
esports and gaming company in the world. The merger with Aquilini GameCo
and Luminosity was a strategic decision that positions us as a dominant
player in the gaming industry and unlocks access to Luminosity’s 50
million dedicated esports fans and one of the largest esports
franchises. Through our successful monetization strategy, we will gain
extremely valuable knowledge and information on the demographic that
will revolutionize the advertising opportunities we can offer to brands
and sponsors.â€
The Transaction
Under a court approved arrangement (the “Arrangementâ€), J55 will acquire all of the outstanding common shares of Enthusiast Gaming (the “Enthusiast Common Sharesâ€) in exchange for common shares of J55 (the “J55Common Sharesâ€) on the basis of 4.22 (post consolidation) J55 Common Shares for each one Enthusiast Gaming Common Share (the “Exchange Ratioâ€).
The Arrangement constitutes a merger of Enthusiast Gaming and J55 on a
fully diluted basis, after giving effect to the transactions described
below.
Immediately prior to the completion of the Arrangement, J55 will complete the acquisition of GameCo (the “GameCoTransactionâ€). The GameCo Transaction will be completed pursuant to the terms and conditions of an amalgamation agreement (the “Amalgamation Agreementâ€)
between J55 and GameCo, pursuant to which immediately prior to the
completion of the Arrangement, J55 will acquire all of the outstanding
securities of GameCo which shall constitute J55’s Qualifying Transaction
(as defined in the policies of the TSXV). On closing of the Qualifying
Transaction, all of the issued and outstanding securities of GameCo will
be exchanged for corresponding securities of J55 as follows:
each of the common shares of GameCo (the “GameCo Sharesâ€)
will be cancelled and, in consideration therefor, each GameCo
shareholder will receive one (post consolidation) J55 Share at a deemed
price of $0.30 per J55 Share for each one GameCo Share held;
each of the warrants to purchase GameCo Shares (the “GameCo Warrantsâ€)
will be exchanged for warrants to purchase the corresponding number of
(post consolidation) J55 Shares on the same terms as those contained in
the GameCo Warrants, and each such GameCo Warrant shall be cancelled;
and
each of the options to purchase GameCo Shares (the “GameCo Optionsâ€)
will be exchanged for options to purchase the corresponding number of
(post consolidation) J55 Shares on the same terms as those contained in
the GameCo Options, and each such GameCo Option shall be cancelled.
In connection with closing of the GameCo Transaction, J55 intends to
consolidate its outstanding J55 Common Shares on the basis of 1.25
pre-consolidation shares for every one post-consolidation share prior to
the completion of the GameCo Transaction.
The aggregate of approximately 324,357,495 (post consolidation) J55
Shares is expected to be issued at a deemed price of $0.30 per share
pursuant to the GameCo Transaction. Further, J55 has agreed that, to
satisfy an obligation of GameCo under an existing media services
agreement and as such J55 will issue that number of J55 Shares as is
equal to $59,063 at a price per J55 Share to be determined at a later
date in accordance with said agreement. J55 intends to rely on Section
2.11 of National Instrument 45-106 – Prospectus Exemptions for
an exemption from the prospectus requirements under applicable
securities laws in connection with the issuance of the aforementioned
securities.
The GameCo Transaction will be a Non-Arm’s Length Qualifying
Transaction under the policies of the TSXV and a related party
transaction for the purposes of Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions (“MI 61-101â€)
because J55 and GameCo have certain directors, officers and significant
shareholders in common. As such, J55 is required to hold a
shareholders’ meeting (the “J55 Meetingâ€) to obtain
approval of the GameCo Transaction by the disinterested shareholders of
J55. As of the date of this news release, the date for the J55 Meeting
has not been established and the disinterested shareholder approval has
not been obtained.
The directors, officers and significant shareholders which J55 and
GameCo have in common are as follows: Francesco Aquilini is a director
and significant shareholder of J55 and a director (and chairman of the
board) and significant shareholder of GameCo; Adrian Montgomery is a
director, officer and significant shareholder of both J55 and GameCo;
and Roberto Aquilini is a significant shareholder of both J55 and
GameCo. The interested directors, namely Francesco Aquilini and Adrian
Montgomery, have abstained from voting on approval of the GameCo
Transaction by the board of directors of J55, and the interested
shareholders, namely Francesco Aquilini, Adrian Montgomery and Roberto
Aquilini, will be excluded from voting on approval of the GameCo
Transaction at the J55 Meeting. These interested shareholders
collectively own approximately 63% of the issued and outstanding J55
Shares as follows: Francesco Aquilini – 4,001,000 shares (21.1%); Adrian
Montgomery – 3,999,500 shares (21.1%); Roberto Aquilini – 3,999,500
shares (21.1%). The interested directors have also abstained from voting
on approval of the GameCo Transaction by the board of directors of J55.
Pursuant to the Amalgamation Agreement, J55 and each of Francesco
Aquilini, Adrian Montgomery, John Veltheer, Alexander Helmel, and
Roberto Aquilini (the “Supportersâ€), have entered into support and voting agreements (the “Support Agreementsâ€).
The J55 Shares held by the Supporters collectively represent
approximately 79% of the issued and outstanding J55 Shares. The Support
Agreements provide that, among other things, the Supporters, in their
capacity as J55 Shareholders, (i) will irrevocably support the GameCo
Transaction, and, to the extent permitted by applicable laws, vote all
of their J55 Shares in favour of the proposed J55 Shareholders’
resolution seeking approval of the GameCo Transaction (the “J55 QT Resolutionâ€)
and against any resolution submitted by any J55 Shareholder that is
inconsistent with the J55 QT Resolution and (ii) will not sell, assign,
transfer or otherwise convey any of the J55 Shares held by the
Supporters other than pursuant to the GameCo Transaction.
Immediately prior to the closing of the GameCo Transaction, GameCo will complete its acquisition (the “Luminosity Acquisitionâ€) of Luminosity Gaming Inc. (“Luminosity Canadaâ€) and Luminosity Gaming (USA), LLC (“Luminosity USAâ€, which together with Luminosity Canada is herein referred to as “Luminosity Gaming†and together with J55 and GameCo, “Luminosityâ€).
The Arrangement, the GameCo Transaction and the Luminosity Acquisition
are collectively referred to in this press release as the “Transactionsâ€.
Luminosity Gaming is a globally recognized esports organization
operating in North America and based in Toronto, Canada. Luminosity
Gaming provides management and support services to players involved in
professional gaming and is also the manager of the Vancouver Titans
franchise in the Overwatch League. Upon closing of the GameCo
Transaction, Luminosity Gaming intends to enter into a long-term
management services agreement with the Vancouver Titans to continue
management of the team, as well as a long term services support
agreement with Vancouver Arena Limited Partnership (“VALPâ€)
pursuant to which VALP will provide Luminosity Gaming with a broad
range of marketing and business support services (as further described
below).
Steve Maida, Founder and President of Luminosity Gaming commented, “We
are incredibly excited about the merger with Enthusiast Gaming.
Pairing our collective following of over 50 million with their 150
million monthly visitors presents significant growth opportunities with
respect to content, partnerships, advertising, events and more.â€
The combined company that will result from the completion of the
Transactions will be renamed “Enthusiast Gaming Holdings Inc.â€. Subject
to TSXV approval, the common shares of the combined company will trade
on the TSXV, under the symbol “EGLXâ€.
The Arrangement is subject to receipt of various approvals including
the approval of the Ontario Superior Court of Justice (Commercial List),
the approval of the TSXV and Enthusiast Gaming and J55 shareholder
approval, as well as the closing of the other Transactions and the
satisfaction of certain other customary closing conditions. Closing of
the Arrangement is expected to occur by the third quarter of 2019.
Transaction Highlights
The Arrangement is expected to provide significant strategic and financial benefits to Enthusiast Gaming including:
Creates Leading, Diversified Gaming and Esports Organization: Management
believes that the pro forma combined company will boast one of the
largest media reach amongst gaming and esports organizations at
approximately 200 million, across seven esports teams (including
management of the Vancouver Titans Overwatch League franchise), 40
esports influencers, 80+ gaming media websites, 900+ YouTube and Twitch
channels. The combined business generated pro forma revenue of $22
million and estimated $36 million in cash on closing of the merger.
Strategically Positioned to Leverage Luminosity’s Robust esports brand: Through
its monetization and ad tech platform, Enthusiast Gaming will utilize
Luminosity and its significant reach in growing communities of
like-minded fans, to produce engaging advertising experiences. Further,
GameCo’s relationship with the NHL’s Vancouver Canucks and Rogers Arena,
located in Vancouver Canada, will provide Enthusiast Gaming with access
to new sponsors looking to reach the gaming and esports markets.
Expected Margin Improvement: A combination of the net
funds from the Private Placement (as discussed below) and cash-on-hand
may be used to repay all or part of the Sims Resource Deferred Payment.
The Sims Resource Deferred Payment is approximately US$14.0 million and
when fully repaid will add approximately US$2.5 million of EBITDA to
the combined company, by reducing an expense allocation.
Enhanced Capital Market Profile: The closing of the
Transactions will create a leading publicly listed esports and gaming
organization, as measured by revenue and market capitalization.
Arrangement Summary
The Arrangement will be effected by way of a statutory plan of arrangement pursuant to the Business Corporations Act
(Ontario) and will require the approval of (i) 66â…”% of the Enthusiast
Gaming Common Shares cast at the annual and special meeting of
Enthusiast Gaming shareholders (the “Enthusiast Meetingâ€),
(ii) if required, a majority of the votes cast at the Enthusiast
Meeting by Enthusiast Gaming shareholders excluding votes attached to
Enthusiast Gaming Common Shares held by persons described in items (a)
through (d) of section 8.1(2) of MI 61-101, and (iii) 50% +1 of the J55
Common Shares cast at the J55 Meeting. The directors and officers of
Enthusiast Gaming who, in the aggregate, hold 13% of the outstanding
Enthusiast Gaming Common Shares, have entered into voting and support
agreements pursuant to which they have agreed to vote their Enthusiast
Gaming Common Shares in favor of the proposed Arrangement. The
directors, officers and significant shareholders of J55 who, in the
aggregate, hold approximately 79% of the outstanding J55 Common Shares,
have entered into voting and support agreements pursuant to which they
have agreed to vote their J55 Common Shares in favor of the proposed
Arrangement at the J55 Meeting.
A management information circular setting out the terms of the
Arrangement, as well as further information regarding the Arrangement
and the combined company, will be circulated to all Enthusiast Gaming
shareholders in connection with the Enthusiast Meeting as soon as
possible. A management information circular setting out the terms of
the GameCo Transaction and the Arrangement, as well as further
information regarding the Transactions and the combined company, will be
circulated to all J55 shareholders in connection with the J55 Meeting
as soon as possible. Further details regarding the dates and locations
of the Enthusiast Meeting and the J55 Meeting will be provided once
determined.
The board of directors of Enthusiast Gaming has determined that the
proposed Arrangement is in the best interests of Enthusiast Gaming
shareholders, having taken into account advice from its financial
advisors, and has unanimously approved the Arrangement and recommended
that Enthusiast Gaming shareholders vote in favor of the Arrangement.
The board of directors of Enthusiast received a fairness opinion from
Haywood Securities Inc. to the effect that the consideration to be paid
to the Enthusiast Gaming shareholders pursuant to the Arrangement is
fair, from a financial point of view, to the Enthusiast Gaming
shareholders.
In addition to shareholder approvals, the Arrangement will be subject
to the completion of the GameCo Transaction and the Luminosity
Acquisition and the satisfaction of other customary conditions. The
Arrangement Agreement includes customary provisions, including covenants
from Enthusiast Gaming to J55 not to solicit other acquisition
proposals and the right for J55 to match any superior proposals. A
customary termination fee may be payable by Enthusiast Gaming to J55 in
certain circumstances.
Under the terms of the Transaction, Enthusiast Gaming shareholders
will exchange each of their Enthusiast Gaming Common Shares for 4.22
(post consolidation) J55 Common Shares. Following the completion of the
Arrangement, J55 will change its name to “Enthusiast Gaming Holdings
Inc.†and will maintain its listing on the TSXV while the Enthusiast
Gaming Common Shares will be delisted from the TSXV. Holders of
Enthusiast Gaming options, warrants and convertible debentures will
continue to be entitled to exercise such convertible securities pursuant
to the terms and conditions of their original certificates. Upon
exercise of any such convertible securities, holders will be entitled to
receive that number of J55 Common Shares they would have received had
they exercised such securities immediately prior to the completion of
the Arrangement.
Additional Information Regarding GameCo and Luminosity Gaming
On February 14, 2019, GameCo entered into a share purchase agreement (the “Luminosity SPAâ€)
pursuant to which GameCo agreed to acquire Luminosity Gaming from its
sole shareholder, Steve Maida, for consideration, including the payment
of $1.5 million by GameCo to Mr. Maida and the issuance of 60 million
GameCo common shares (at a deemed issued price of $0.30 per share) and
the issuance of a $2.0 million unsecured promissory note, which is
repayable immediately upon completion of the GameCo Transaction. As
noted above, the Luminosity Acquisition is expected to close immediately
prior to the completion of the GameCo Transaction and the Arrangement.
Luminosity Gaming is currently the manager of the Vancouver Titans,
which was founded in 2018 and recently commenced its first season of
competition in the Overwatch League, an esports competition with 20
teams across six countries and three continents, all centered on the
popular first-person shooter game Overwatch. Upon closing of
the GameCo Transaction, Luminosity Gaming intends to enter into a
long-term management services agreement with the Vancouver Titans to
continue management of the team, as well as a long term services support
agreement with VALP pursuant to which VALP will provide Luminosity
Gaming with a broad range of marketing and business support services,
including corporate partnership and selling support, retail support,
brand association and marketing support (to be provided by Canucks
Sports and Entertainment), esports planning and execution, digital and
social media support and back office support.
The following table provides select financial information for GameCo and Luminosity:
GameCo Aug 29, 2018* – Dec 31, 2018 (Audited)
Luminosity Year Ended Dec 31, 2018 (Unaudited)
Total revenue
$
–
$
3,879,608
Total assets
$
5,865,179
$
869,764
Total liabilities
$
421,538
$
381,009
Net income (loss)
$
(384,105
)
$
425,964
*The date of incorporation of GameCo.
Management Team and Board of Directors
The senior management team and the board of directors of the combined
company will draw from the extensive experience and expertise of both
companies. The senior management will consist of:
Chief Executive Officer: Adrian Montgomery President: Menashe Kestenbaum President of Esports: Steve Maida President of EGLive: Corey Mandell Chief Operating Officer and SVP Finance: Eric Bernofsky Chief Financial Officer: Alex Macdonald Chief Information Officer: Meir Bulua
The board of directors of the combined company will initially consist
of seven directors, including three nominees of Enthusiast including
Menashe Kestenbaum and Alan Friedman and one to be named and three
nominees of J55 including Francesco Aquilini, Adrian Montgomery and
Steve Maida, and one independent nominee to be agreed upon by both
Enthusiast and J55. Francesco Aquilini will serve as the Chair of the
board.
Private Placement, Loan and Subscription Receipt Offering
Concurrent with the announcement of the Arrangement, GameCo has entered into a bought deal private placement agreement (the “Private Placementâ€) with a syndicate of underwriters (the “Underwritersâ€) led by Canaccord Genuity Corp. (“Canaccordâ€),
whereby the Underwriters have agreed to purchase for resale to
substituted purchasers $10.0 million of convertible debentures at par
(the “Debenturesâ€) of GameCo, which will effectively
convert into J55 Common Shares at a (post consolidation) conversion
price of $0.45 per J55 Common Share, for aggregate gross proceeds of
$10.0 million (the “Private Placementâ€). The Debentures
will have a maturity date of June 30, 2020 and will automatically
convert into common shares of GameCo upon closing of the Arrangement. If
the Debentures have not automatically converted to GameCo common shares
by the maturity date, then the principal will be repayable on the
maturity date as well as interest on the basis of 8.0% per annum. The
net proceeds from the Private Placement will be used by GameCo to extend
a $10.0 million bridge loan (the “Bridge Loanâ€) to
Enthusiast Gaming which Enthusiast Gaming may use to repay all or part
of certain amounts owed in connection with the acquisition of 100% of
the assets of The Sims Resource (the “Sims Resource Deferred Paymentâ€)
and/or to fund working capital and/or other general corporate purposes.
All principal and unpaid interest under the Bridge Loan will be due and
payable by Enthusiast Gaming to GameCo on the earlier of (a) June 20,
2020, and (b) the closing of a change of control transaction (which
includes the closing of the Arrangement).
On March 20, 2019, GameCo completed a $25,000,200 subscription receipt offering (the “Subscription Receipt Offeringâ€) pursuant to which it issued an aggregate of 83,334,000 subscription receipts (each, a “Subscription Receiptâ€)
at an issue price of $0.30 per Subscription Receipt. Canaccord served
as the sole agent for the Subscription Receipt Offering. Each
Subscription Receipt is automatically converted into one common share of
GameCo for no additional consideration upon satisfaction of certain
escrow release conditions (collectively, the “Escrow ReleaseConditionsâ€), including: (a) the execution of a definitive agreement (the “GameCo Transaction Agreementâ€)
between J55, a wholly-owned subsidiary of J55 and GameCo in connection
with the GameCo Transaction; (b) the execution of the Luminosity SPA and
the satisfaction or waiver of all the conditions precedent in the
Luminosity SPA to the satisfaction of Canaccord; (c) the receipt of all
regulatory, shareholder and third party approvals required in connection
with the GameCo Transaction and the Luminosity Acquisition; and (d)
GameCo not being in breach or default of any of its covenants or
obligations under the agency agreement and the subscription receipt
agreement entered into in connection with the Subscription Receipt
Offering. Upon the closing of the GameCo Transaction, GameCo common
shares issued on conversion of the Subscription Receipts will be
exchanged for post-consolidation J55 Common Shares in accordance with
the terms of the GameCo Transaction Agreement.
Advisors
Haywood Securities Inc. is acting as Enthusiast Gaming’s financial
advisor, and Stikeman Elliott LLP and Minden Gross LLP are acting as
Enthusiast’s legal advisors in connection with the Arrangement. Clark
Wilson LLP is acting as J55’s legal advisor in connection with the
Transactions. Canaccord Genuity Corp. is acting as GameCo’s exclusive
financial advisor, and Norton Rose Fulbright LLP is acting as GameCo’s
legal advisor in connection with the Transactions.
Capitalization of the Combined Company
Upon completion of the Transactions, it is expected that there will
be 557 million common shares of the combined company issued and
outstanding as well as options and warrants to acquire a further
aggregate of 109 million common shares. Furthermore, upon completion of
the Arrangement the then outstanding common shares of the combined
company will be held as follows:
15.2 million shares (2.7%) held by former shareholders of J55;
246.9 million shares (44.3%) held by former shareholders of GameCo (inclusive of the conversion of the Subscription Receipts);
60 million shares (10.8%) held by former shareholders of Luminosity;
213.1 million shares (38.2%) held by former shareholders of Enthusiast Gaming; and
22.2 million shares (4.0%) held by former holders of the Debentures assuming conversion at a price of $0.45.
In addition, it is expected that there will be outstanding combined
company convertible securities which will be redeemable for, or
convertible into, an aggregate of 25 million common shares of the
combined company.
About Enthusiast Gaming
Founded in 2014, Enthusiast Gaming is the largest vertically
integrated video game company and has the fastest-growing online
community of video gamers. Through the Company’s organic and acquisition
strategy, it has amassed a platform of over 150 million monthly
visitors across its network of websites and YouTube channels. Enthusiast
also owns and operates Canada’s largest gaming expo, Enthusiast Gaming
Live Expo, EGLX, (eglx.ca) with approximately 55,000 people attending in
2018. For more information on the Company, visit www.enthusiastgaming.com.
CONTACT INFORMATION: Investor Relations: Julia Becker Head of Investor Relations & Marketing [email protected] (604) 785.0850
Certain information in this news release constitutes forward-looking
statements under applicable securities laws. Any statements that are
contained in this news release that are not statements of historical
fact are forward-looking statements. Forward looking statements are
often identified by terms such as “may”, “should”, “anticipate”,
“expect”, “potential”, “believe”, “intend”, “estimate†or the negative
of these terms and similar expressions. Forward-looking statements in
this news release include, but are not limited to: statements with
respect to the completion of the Transactions and the timing for its
completion; the satisfaction of closing conditions which include,
without limitation (i) required shareholder approval, (ii) necessary
court approval in connection with the plan of arrangement, (iii) receipt
of any required approvals, (iv) certain termination rights available to
the parties under the Arrangement Agreement, (v) obtaining the
necessary approvals from the TSXV, (vi) other closing conditions,
including compliance by the parties with various covenants contained in
the Arrangement Agreement, (vii) statements with respect to the effect
of the Transaction on the parties; and (viii) statements with respect to
the anticipated benefits associated with the Transactions.
Forward-looking statements are based on certain assumptions regarding
Enthusiast, GameCo, J55 and Luminosity, including the completion of the
Transactions, anticipated benefits from the Transactions, and expected
growth, results of operations, performance, industry trends and growth
opportunities. While Enthusiast, GameCo, J55 and Luminosity consider
these assumptions to be reasonable, based on information currently
available, they may prove to be incorrect. Readers are cautioned not to
place undue reliance on forward-looking statements.
The assumptions of Enthusiast, GameCo, J55 and Luminosity, although
considered reasonable by them at the time of preparation, may prove to
be incorrect. In addition, forward-looking statements necessarily
involve known and unknown risks, including, without limitation, risks
associated with general economic conditions; adverse industry events;
future legislative, tax and regulatory developments; inability to access
sufficient capital from internal and external sources, and/or inability
to access sufficient capital on favourable terms; the inability to
implement business strategies; competition; currency and interest rate
fluctuations and other risks. Among other things, there can be no
assurance that the Transactions will be completed or that the
anticipated benefits from the Transactions will be achieved. Readers are
cautioned that the foregoing list is not exhaustive. Readers are
further cautioned not to place undue reliance on forward-looking
statements as there can be no assurance that the plans, intentions or
expectations upon which they are placed will occur. Such information,
although considered reasonable by management at the time of preparation,
may prove to be incorrect and actual results may differ materially from
those anticipated. For more information on the risk, uncertainties and
assumptions that could cause anticipated opportunities and actual
results to differ materially, please refer to the public filings of
Enthusiast and J55 which are available on SEDAR at www.sedar.com.
Forward-looking statements contained in this news release are expressly
qualified by this cautionary statement and reflect our expectations as
of the date hereof, and thus are subject to change thereafter.
Enthusiast, GameCo, J55 and Luminosity disclaim any intention or
obligation to update or revise any forward-looking statements, whether
as a result of new information, future events or otherwise, except as
required by law.
Neither the TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in the policies of the TSX Venture
Exchange) accepts responsibility for the adequacy or accuracy of this
release. The securities of the Corporation have not been and will not be
registered under the United States 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 requirement. This press
release shall not constitute an offer to sell or the solicitation of an
offer to buy nor shall there be any sale of the securities in any
jurisdiction in which such offer, solicitation or sale would be
unlawful.
Posted by AGORACOM-JC
at 3:30 PM on Thursday, May 30th, 2019
SPONSOR: Enthusiast Gaming Holdings Inc.
(TSX-V: EGLX) Uniting gaming communities with 80 owned and affiliated
websites, currently reaching over 75 million monthly visitors. The
company exceeded 2018 target with $11.0 million in revenue. Learn More
EGLX: TSX-V ———————————-
Why Investors Should Be Looking at the eSports Industry
By 2022, analysts expect there to be nearly 300 million frequent viewers of eSports around the world, while 347 million people are forecast to be occasional viewers.
The eSports audience size is also
increasing, as more and more fans tune in to watch amateur and
professional gamers compete. The fanbase has already grown massive,
with an estimated 25.7 million eSports viewers in the US alone last year.
By 2022, analysts expect there to be nearly 300 million frequent
viewers of eSports around the world, while 347 million people are
forecast to be occasional viewers.
Investors looking for the next big
thing after the cannabis and cryptocurrency booms should definitely
consider investing in companies that are involved in the burgeoning
eSports industry. From eSports game developers and publishers to digital
media platforms and eSports tournaments, there are ample opportunities
to cash in on the growing eSports industry.
Investing in the eSports Industry
eSports involve multiplayer video games
that are played competitively by both professional and amateur gamers
for spectators. These can be first-person shooter games (FPS), real-time
strategy (RTS) games, multiplayer online battle arena (MOBA) games,
sports games, card games, strategy games, or fighting games.
Although the eSports industry is
dominated by well-known game publishers like Tencent Holdings Ltd.
(OTCPK:TCTZF) and Sony (NYSE:SNE), there are a few up-and-comers
offering promising products to the market.
Posted by AGORACOM-JC
at 3:22 PM on Thursday, May 30th, 2019
Entered into a share purchase agreement dated May 29, 2019, with BWA Group PLC (PZ: BWAP)
An arm’s length company listed on the London NEX Exchange a minority shareholders of Kings of the North Corp., owned at 50.18% by SX, pursuant to which BWA will acquire of all the issued and outstanding shares of KOTN for an aggregate consideration of CAD $7,500,000 or approximately 4,400,000 GBP.
Baie-Comeau / May 30, 2019 – St-Georges Eco-Mining Corp. (CSE: SX)(OTC: SXOOF) (FSE: 85G1) is pleased to announce it entered into a share purchase agreement dated May 29, 2019, with BWA Group PLC (PZ: BWAP) , an arm’s length company listed on the London NEX Exchange in the United Kingdom and incorporated under the laws of England and Wales, and the minority shareholders of Kings of the North Corp., owned at 50.18% by SX, pursuant to which BWA will acquire of all the issued and outstanding shares of KOTN for an aggregate consideration of CAD$7,500,000 or approximately 4,400,000 GBP.
Mark Billings, Chairman of
SX, and President and CEO of KOTN commented: “Both Kings of the North
and St-Georges are happy to have concluded this transaction with BWA.
This is the first step in accessing funds to develop properly the assets
that have been assembled in KOTN. We look forward to working with our
new colleagues in the United Kingdom, which provides exposure of our
Company to one of the largest financial markets in the world.”
At the time of closing of
the Acquisition, KOTN will own a 100% beneficial interest in a suite of
mineral exploration properties in the Province of Quebec, other than the
properties known as the Villebon, Hemlo North, and Nova Gold properties
in respect of which KOTN will hold an option to acquire between 65% and
100%, upon the terms and condition detailed below.
The Purchase Price
will be funded with the issuance by BWA of the sterling equivalent of
$7,500,000 unsecured, convertible interest-free loan notes (the “Notes“)
with an initial repayment date three years after issue. The conversion
terms are such that SX and its related parties cannot own more than 29%
of the equity of BWA. The minimum conversion price is ?0.005 per share
at the time of conversion. SX will receive Notes in the principal amount
of $3,763,301.80 in exchange for the KOTN Interest.
The Acquisition is
conditional upon: (i) BWA raising a minimum of ?500,000 (approximately
$850,000) through the issuance of new BWA shares, BWA subscribing to
$300,000 in common shares (each a “SX Share“) in the capital of SX at a price equal to the 10 VWAP at the time of issue, subject to a minimum of $0.10 per Share (the “SX Subscription“), and (iii) the consent of the shareholders of BWA.
Upon completion of the
transaction Mr. Vilhjalmur Thor Vilhjalmsson, the President and CEO of
SX will be appointed CEO and a director of BWA.
Concurrent Transactions
Prior to entering into the SPA, KOTN secured the following assets and option:
– 100% interest,
subject to a 3% NSR royalty, of which half may be bough back for
$3,000,000, in the Winter House property in consideration of the
issuance of 7,200,000 common shares (each a “Share“) in the capital of KOTN (the “WH Acquisition“);
– Option to acquire up to an 85% interest in the Hemlo North property from Canadian Orebodies Inc. (TSXV: CORE),
in consideration of the issuance of 1,296,976 Shares and $750,000 in
exploration expenditures on or before March 31, 2020 for an initial 50%,
$350,000 in 15% convertible notes and a further $750,000 in exploration
expenditures on or before March 31, 2021 for an additional 25%, and a
final to 10% upon the delivery of a positive feasibility study;
– Option to acquire up to a
100% interest, subject to a 1.8% NSR royalty, of which half may be bough
back for $1,000,000, in the Nova Gold property from prospectors., in
consideration of the issuance of 1,482,258 Shares, $1,000,000 in
exploration expenditures as follows: $400,000 on or before August 28,
2020, and $300,000 on or before each of August 28, 2021 and 2022, and
cash payment of $300,000 to be made on August 28, 2021 and 2022; and
– Option to acquire up to a 65% interest, subject to a 2% NSR royalty, of which 1% may be
bough back for $3,000,000, in the Villebon property from SX, in
consideration of the issuance of 741,130 Shares and $3,000,000 in
exploration expenditures as follows: $200,000 on or before May 28, 2020,
$500,000 $200,000 on or before May 28, 2021, $1,00,000 on or before May
28, 2022, and $1,300,000 on or before May 28, 2023.
KOTN also settled aggregate debts of $504,000 through the issuance of 1,867,645 Shares (the “Debt Settlement“), and SX subscribed to 1,111,693 Shares for an aggregate subscription price of $300,000.
All securities issued under
the SX Subscription will be subject to a hold period expiring four
months and one day from the date of issuance.
Related-party transaction
Portions of the WH
Acquisition and Debt Settlement, are considered to be a “related party
transaction” for purposes of Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions (“MI 61-101“).
The Corporation is relying on exemptions from the formal valuation and
minority shareholder approval requirements available under MI 61-101.
The Corporation is exempt from the formal valuation requirement in
section 5.4 of MI 61-101 in reliance on sections 5.5(a) and (b) of MI
61-101 as the fair market value of each transaction is not more than the
25% of the Corporation’s market capitalization, and no securities of
the Corporation are listed or quoted for trading on prescribed stock
exchanges or stock markets. Additionally, the Corporation is exempt from
minority shareholder approval requirement in section 5.6 of MI 61-101
in reliance on section 5.7(b) as the fair market value of each
transaction is not more than the 25% of the Corporation’s market
capitalization. The board of directors of the Corporation approved the
WH Acquisition and Debt Settlement, with Frank Dumas, Frank Dumas, Neha
Tally, Mark Billings, Peter Smith and Gerry Nichols having declared a
conflict of interest in, and abstaining from voting on, the matters
being considered.
ON BEHALF OF THE BOARD OF DIRECTORS
“Mark Billings”
Mark Billings, Chairman
About St-Georges
St-Georges is developing new technologies to solve the some of the most common environmental problems in the mining industry.
The Company controls
directly or indirectly, through rights of first refusal, all of the
active mineral tenures in Iceland. It also explores for nickel on the
Julie Nickel Project & for industrial minerals on Quebec’s North
Shore and for lithium and rare metals in Northern Quebec and in the
Abitibi region. Headquartered in Montreal, St-Georges’ stock is listed
on the CSE under the symbol SX, on the US OTC under the Symbol SXOOF and
on the Frankfurt Stock Exchange under the symbol 85G1.
Cautionary Statements Regarding Forward-Looking Information
Certain
statements included herein may constitute “forward-looking statements”.
All statements included in this press release that address future
events, conditions, or results, including in connection with the
prefeasibility study, its financing, job creation, the investments to
complete the project and the potential performance, production, and
environmental footprint of the ferrosilicon plant, are forward-looking
statements. These forward-looking statements can be identified by the
use of words such as “may”, “must”, “plan”, “believe”, “expect”,
“estimate”, “think”, “continue”, “should”, “will”, “could”, “intend”,
“anticipate”, or “future”, or the negative forms thereof or similar
variations. These forward-looking statements are based on certain
assumptions and analyses made by management in light of their
experiences and their perception of historical trends, current
conditions, and expected future developments, as well as other factors
they believe are appropriate in the circumstances. These statements are
subject to risks, uncertainties, and assumptions, including those
mentioned in the Corporation’s continuous disclosure documents, which
can be found under its profile on SEDAR (www.sedar.com).
Many of such risks and uncertainties are outside the control of the
Corporation and could cause actual results to differ materially from
those expressed or implied by such forward-looking statements. In making
such forward-looking statements, management has relied upon a number of
material factors and assumptions, on the basis of currently available
information, for which there is no insurance that such information will
prove accurate. All forward-looking statements are expressly qualified
in their entirety by the cautionary statements set forth above. The
Corporation is under no obligation, and expressly disclaims any
intention or obligation, to update or revise any forward-looking
statements, whether as a result of new information, future events or
otherwise, except as expressly required by applicable law.
