Globalive Technology today announced that it has signed a
binding letter agreement to complete a reverse takeover transaction
with Yooma Corp., an Asia-focused
social commerce company with operations in China and Japan to complement the recently announced
transaction with vertically-integrated Socati Corp.
TORONTO, July 13, 2020 /CNW/ - Globalive Technology Inc.
(TSXV: LIVE) (the "Company"), a technology company based in
Toronto, Ontario, announced today
that it has signed a binding letter of intent (the
"LOI") with Yooma Corp. ("Yooma") dated
July 13, 2020 to complete an arm's
length reverse take-over pursuant to which the Company will acquire
all of the issued and outstanding securities of Yooma in exchange
for common shares of the Company (the "Yooma
Transaction"). The Yooma Transaction and the previously
announced transaction (the "Socati RTO", or together with
the Yooma Transaction, the "Transaction") with Socati Corp.
("Socati") are expected to close contemporaneously with the
resulting issuer (the "Resulting Issuer") continuing under
such name as Socati may reasonably determine, subject to the
satisfaction and/or waiver of all required conditions precedent,
including consents and approvals from regulators and
shareholders.
About Yooma
Yooma is a private corporation, incorporated under the laws of
the Province of Ontario in 2019,
with its corporate headquarters in Toronto, Ontario. Through its wholly-owned
subsidiary, Entertainment Direct Asia Ltd. ("EDA"), and
EDA-owned entities based in China
and Japan, management of Yooma
intends to leverage the success and experience of its senior
managers to build Yooma's business into one of Asia's leading cannabinoid (CBD) products
social commerce companies through the distribution and sale of CBD
beauty and skincare products via a strategically curated network of
sales channels. Yooma has assembled a strong international team of
multicultural industry professionals with extensive experience in
digital marketing, ecommerce and social media in the pan-Asian
region, with particular depth in the Chinese ecommerce market
having launched in excess of 100 brands in China over the past eight years. Yooma
recently raised US$5.1 million
through a financing completed in May
2020 at a price of US$0.65 per
share (the "May Financing").
The Transaction
Subject to regulatory and shareholder approval, and the
satisfaction of other conditions precedent, the Company intends to
acquire all of the issued and outstanding securities of Yooma
(collectively, the "Yooma Securities") from the holders of
the Yooma Securities (collectively, the "Yooma
Securityholders") for aggregate consideration of approximately
US$25 million. The consideration will
be paid by issuing common shares of the Company to the Yooma
Securityholders at a price per share (the "Share Price")
calculated by dividing the value of all assets remaining in the
Company on closing (including cash and cash-equivalents), plus
US$500,000, by the number of issued
and outstanding common shares of the Company, on a fully-diluted
basis, on the date of the closing. The Company estimates that it
will hold cash and cash equivalents of no less than US$4,500 000 by the closing date of the
Transaction.
The terms of the Yooma Transaction contemplate that, with the
exception of cash and cash-equivalents, the Company's existing
business, assets and liabilities, including its technology venture
subsidiaries and their intellectual property, its interest in
Flexiti Financial Inc. and its affiliates and some or all of its
technology investments will, subject to regulatory and shareholder
approval, be transferred to a third-party that is to be determined,
with the value of such assets captured or distributed to the
shareholders of the Company immediately prior to the Transaction
(the "Spin-Off").
The Company and Socati will rationalize their equity incentive
plans, any equity incentives issued under such plans and all other
outstanding convertible securities to create one or more
post-Transaction equity incentive plans in the Resulting Issuer to
properly incentivize management, directors and key employees.
The Yooma Transaction is subject to conditions precedent (the
"Conditions") substantively similar to those provided for in
the Socati RTO, including but not limited to: (i) the Company
continuing to be listed on the TSX Venture Exchange (the
"Exchange"); (ii) director and shareholder approval for both
Yooma and the Company; (iii) receipt of any necessary Exchange,
regulatory and third-party approvals or consents; (iv) no material
adverse change in either the Company or Yooma between the date of
the LOI and the closing of the Yooma Transaction; (v) the Company
holding cash and cash-equivalents of no less than US$4,500,000 on closing of the Yooma Transaction;
(vi) completion of the pre-closing matters described above, (vii)
the completion of the Socati RTO; (viii) the completion of the
Spin-Off on terms satisfactory to the parties, acting reasonably;
and (ix) other conditions typical for a transaction of this
nature.
No insider of the Company, or any of their associates or
affiliates, has any material interest, direct or indirect, in the
Yooma Transaction other than in connection with the entitlement of
such insiders who are shareholders of the Company to receive shares
of the Resulting Issuer on the same basis as other shareholders of
the Company, and Mr. Lacavera as a potential director of the
Resulting Issuer. No finder fee will be paid in connection with the
Yooma Transaction.
Yooma Financing
Prior to completion of the Yooma Transaction, Yooma may seek to
complete a private placement at the same valuation as the May
Financing (the "Yooma Financing"), the net proceeds
of which, if any, will increase the valuation of Yooma (on a dollar
for dollar basis) for the purposes of the Transaction. The Yooma
Financing, to the extent it is completed, would be in addition to
the proposed private placement of subscription receipts by Socati
referenced in the Company's press released dated June 4, 2020 (the "June
4 Release").
Sponsorship
Sponsorship of the Transaction is required by the policies of
the Exchange unless an exemption is granted by the Exchange.
The Company intends to apply for an exemption from the sponsorship
requirement in accordance with Exchange policy, however, there can
be no assurance that the Exchange will grant such an exemption.
Proposed Management and Board of Directors of the Resulting
Issuer
Upon completion of the Transaction, it is anticipated that
certain of Yooma's current executive and management teams will be
integrated with the proposed management and board of directors of
the Resulting Issuer, as described in the June 4 Release.
Additional Information
A copy of the LOI with more detailed information about the Yooma
Transaction is available for review on the Company's SEDAR page at
www.sedar.com. The Company will disclose additional
information relating to the Yooma Transaction, the Socati RTO, the
Spin-Off and related matters as soon as they becomes available,
including additional financial information relating to Yooma, the
backgrounds of any other person who may constitute an insider of
the Resulting Issuer, and any other relevant information.
The LOI is binding on the parties, however, the parties are
continuing to negotiate the more detailed, definitive agreements
that will govern the Yooma Transaction, the Spin-Off and related
matters. In the course of those negotiations, material terms
pertaining to the Yooma Transaction, including its structure,
timing, the consideration payable for the Yooma Securities, the
calculation of the Share Price, the Yooma Financing, closing
conditions and other matters may be added, amended or removed. The
Company will provide an update on any material terms not already
disclosed as soon as reasonably possible once that information
becomes available.
Completion of the Yooma Transaction is subject to a number of
conditions precedent, including the Conditions described
above. If the conditions precedent cannot be satisfied or (if
applicable) waived, the Yooma Transaction will not close. There can
be no assurance that the Yooma Transaction will be completed as
proposed or at all. Completion of the Yooma Transaction is
not a condition of the Socati RTO.
Investors are cautioned that, except as disclosed in the
management information circular or filing statement to be prepared
in connection with the Transaction, any information released or
received with respect to the Transaction may not be accurate or
complete and should not be relied upon. Trading in the Company's
securities in anticipation of the Transaction should be considered
highly speculative.
The Exchange has not considered or made any determination on the
merits of the proposed Yooma Transaction or the Socati RTO and has
neither approved nor disapproved of the contents of this press
release.
About Globalive Technology Inc.
Globalive Technology is a next generation software company and
venture partner developing innovative solutions to disrupt
traditional industries by leveraging artificial intelligence and
machine learning technology stacks. Globalive Technology is
controlled by Globalive Capital Inc., which has founded and
co-founded 12 businesses over the past 20 years with six successful
exits ranging from US$10M to US$1.3B. It has also made over 100 venture
investments and has over 45 technology companies in its portfolio.
For more information, visit www.globalivetech.com.
About Yooma Corp.
Through its wholly-owned subsidiary, EDA and EDA-owned entities
based in China and Japan, Yooma intends to leverage the success
and experience of its senior management to build Yooma's business
into one of Asia's leading
cannabinoid (CBD) products social commerce companies through the
distribution and sale of CBD beauty and skincare products via a
strategically curated network of sales channels. Yooma has
assembled a strong international team of multicultural industry
professionals with extensive experience in digital marketing,
ecommerce and social media in the pan-Asian region with particular
depth in the Chinese ecommerce market.
For media inquiries:
Rob
Moysey
Communications Manager, Globalive
Media@globalivetech.com
For investor inquiries:
Simon
Lockie
Chief Corporate Officer
1-647-977-2727
InvestorRelations@globalivetech.com
CAUTION REGARDING FORWARD-LOOKING INFORMATION
This news release contains forward-looking statements
relating to the timing and completion of the proposed Yooma
Transaction, Socati RTO and Spin-Off, the future operations of the
Company and the Resulting Issuer, growth in hemp-derived products
in Asia and Yooma's ability to
capitalize on such growth, and other statements that are not
historical facts. Such forward-looking statements are often
identified by terms such as "possible", "if", "will", "subject to",
"believes", "expected", "intends", "estimates", "following",
"continuing to", "anticipated" and similar expressions. All
statements, other than statements of historical fact included in
this release, including those noted above, are forward-looking
statements that involve risks and uncertainties. There can be no
assurance that such statements will prove to be accurate and actual
results and future events could differ materially from those
anticipated in such statements. Important factors that could cause
actual results to differ materially from the Company's expectations
include changes to Yooma, Socati or the Company's business
focus, strategic plan or capital requirements; changes in market,
industry and regulatory conditions for Yooma, Socati or the
Company; unexpected operating gains or losses in Yooma, Socati or
the Company; a breakdown in the Company's relationship with Yooma
or Socati; the inability to satisfy the conditions precedent to
complete the Yooma Transaction or the Socati RTO; the inability to
raise adequate financing, or adequate financing on terms
sufficiently favourable to Yooma, Socati and the Company; the
inability to obtain the necessary regulatory, shareholder and
third-party approvals for the Yooma Transaction or the Socati RTO;
changes in Yooma, Socati or the Company's assessment of the
desirability of the Yooma Transaction and/or the Socati RTO; other
parties seeking to acquire an interest in Yooma, Socati or the
Company; competitors in the industry and other risks as set
out in the Company's Filing Statement available on its SEDAR page
at www.sedar.com.
The reader is cautioned that assumptions used in the
preparation of any forward-looking information may prove to be
incorrect. Events or circumstances may cause actual results to
differ materially from those predicted as a result of numerous
known and unknown risks, uncertainties, and other
factors, many of which are beyond the control of the Company.
The Company cannot guarantee that any of the forward-looking
statements contained in this press release will occur as disclosed
herein or at all. The reader is cautioned not to place undue
reliance on any forward-looking information.
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. Forward-looking statements contained in this news
release are expressly qualified by this cautionary statement. The
forward-looking statements contained in this news release are made
as of the date of this news release and the Company will only
update or revise publicly the included forward-looking statements
as expressly required by Canadian securities law.
This news release does not constitute an offer to sell or a
solicitation of an offer to buy any of the securities of the
Company, Yooma, Socati or the Resulting Issuer in either
Canada or the United States.
The securities of such entities have not been and will not be
registered under the United States Securities Act of 1933, as
amended (the "US Securities Act"), or any state securities
laws and may not be offered or sold within the United States or to U.S. Persons unless
registered under the US Securities Act and applicable state
securities laws or an exemption from such registration is
available.
Neither the Exchange nor its Regulation Services Provider (as
that term is defined in the policies of the Exchange) accepts
responsibility for the adequacy or accuracy of this
release.
SOURCE Globalive Technology