CALGARY, ALBERTA--(Marketwired - Oct. 30, 2014) -
NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES OF AMERICA. ANY FAILURE TO COMPLY WITH THIS RESTRICTION MAY CONSTITUTE A VIOLATION OF U.S. SECURITIES LAWS.
eQube Gaming Limited (formerly Triox Limited) (TSX VENTURE:TTL.P) (the "Corporation") is pleased to announce that it has closed its previously announced business combination involving eQube Technology and Software Inc. ("eQube") as the "Qualifying Transaction" of the Corporation (as such term is defined within the meaning of Policy 2.4 of the TSX Venture Exchange (the "Exchange")). Subject to receiving final Exchange acceptance, the ordinary shares of the Corporation are expected to resume trading on the Exchange on or about November 4, 2014 under the new name "eQube Gaming Limited", on a post-Consolidation basis (as defined below) and under the trading symbol "EQG".
Pursuant to the terms of an amalgamation agreement dated effective July 2, 2014 (the "Amalgamation Agreement") between the Corporation, eQube and 1824721 Alberta Ltd. ("Subco"), eQube and Subco amalgamated (the "Amalgamation") under the Business Corporations Act (Alberta) to form a new company under the corporate name "eQube Technology and Software Inc." ("Amalco"). Amalco will carry on the business previously carried on by eQube as a subsidiary of the Corporation.
On October 29, 2014, the Corporation consolidated (the "Consolidation") all of its issued and outstanding ordinary shares (the "Ordinary Shares") and all outstanding options and warrants to purchase Ordinary Shares on the basis of one (1) post-Consolidation Ordinary Share for every three (3) pre-Consolidation Ordinary Shares.
Following completion of the Consolidation and pursuant to the Amalgamation (with each Ordinary Share being issued on a post-Consolidation basis):
- the holders of class "A" common shares of eQube ("eQube Class A Shares") received three (3) Ordinary Shares for each eQube Class A Share held in exchange for the issuance to the Corporation of three (3) common shares of Amalco ("Amalco Common Shares") for each eQube Class A Share so exchanged;
- the holders of class "F" preferred shares of eQube ("eQube Class F Shares") received one preferred share of Amalco ("Amalco Preferred Shares") for each eQube Class F Share held;
- the Corporation received one (1) Amalco Common Share for each Class "A" common share of Subco ("Subco Share") held;
- the holders of Subco Shares (other than the Corporation and including Subco Shares issued pursuant to the Offerings (as defined below)) received one (1) Ordinary Share for each Subco Share held in exchange for the issuance to the Corporation of one (1) Amalco Common Share for each Subco Share so exchanged;
- all of the options to purchase eQube Class A Shares ("eQube Options") were replaced with options ("Options") to purchase three (3) Ordinary Shares for each eQube Class A Share issuable on exercise of the eQube Options; and
- all of the Subco Agent Warrants (as defined below) were replaced with Agent Warrants (as defined below) to purchase one (1) Ordinary Share for each Subco Share issuable on exercise of the Subco Agent Warrants.
Upon completion of the Amalgamation, there were 28,861,069 Ordinary Shares issued and outstanding. An aggregate of 9,914,529 Ordinary Shares issued to the former holders of eQube Class "A" Shares were placed in escrow pursuant to a value security escrow agreement pursuant to the policies of the Exchange and will be released in accordance with the terms thereof.
Private Placement Financings
As a condition to and prior to the closing of the Amalgamation, Subco completed a brokered private placement for 5,220,000 class "A" common shares of Subco ("Subco Shares") at a price of $0.50 per Subco Share for gross proceeds of $2,610,000.00 (the "Brokered Offering"). Richardson GMP Limited ("RGMP") acted as agent under the Brokered Offering. Subco also completed a non-brokered private placement for 1,355,000 Subco Shares at a price of $0.50 per Subco Share for gross proceeds of $677,500.00 (the "Non-Brokered Offering"). Collectively, the Brokered Offering and the Non-Brokered Offering are referred to herein as the "Offerings".
Pursuant to the Brokered Offering, RGMP received a commission equal to 8% of the aggregate gross proceeds placed under the Brokered Offering, payable in cash, and was paid a corporate finance fee. RGMP was also granted warrants by Subco (the "Subco Agent Warrants") to acquire that number of Subco Shares equal to 8% of the total number of Subco Shares sold under the Brokered Offering, exercisable at a price of $0.50 per Subco Agent Warrant for a period of 24 months from the closing date of the Brokered Offering.
Under the Amalgamation: (i) each Subco Share issued pursuant to the Offerings were exchanged for one (1) Ordinary Share; and (ii) the Subco Agent Warrants were replaced with agent warrants ("Agent Warrants") to purchase one (1) Ordinary Share for each Subco Share issuable on exercise of the Subco Agent Warrants.
The net proceeds of the Offerings will be used to purchase equipment for customer deployment, research and development initiatives, licensing and third party approvals, working capital requirements arising from contracts recently awarded to eQube for its products and for long term growth, market penetration and acquisitions.
Pursuant to the joint venture agreement dated July 22, 2014 (the "JV Agreement") between eQube, the Corporation and Catalyst Gaming Corporation ("Catalyst"), immediately after the closing of the Amalgamation, Tebten Limited ("Tebten") entered into purchase and sale agreements (the "Purchase and Sale Agreements") to purchase 1,500,000 Amalco Preferred Shares from existing holders of Amalco Preferred Shares within 90 days from the closing of the Amalgamation.
The Corporation and Tebten also entered into a share exchange agreement whereby the parties agreed that subject to the completion of the purchase and sale of the 1,500,000 Amalco Preferred Shares pursuant to the Purchase and Sale Agreements, the Corporation would purchase such 1,500,000 Amalco Preferred Shares in exchange for 3,000,000 Ordinary Shares, which shares shall be placed into a value security escrow agreement pursuant to the policies of the Exchange.
Pursuant to the JV Agreement, at the closing of the Amalgamation, the Corporation delivered warrants ("Consideration Warrants") to purchase Ordinary Shares to Catalyst. The exercise of the Consideration Warrants is conditional, among other things, on achieving "Benchmark Success" as that term is defined in the JV Agreement. If Benchmark Success has been achieved, then Catalyst will be deemed to have exercised the Consideration Warrants and the Corporation shall issue and deliver Ordinary Shares that on payout equal to 20% of the then-enlarged capital of the Corporation, up to a maximum of 54 million Ordinary Shares.
Following the closing of the Transaction, the current officers and directors of the Corporation, other than Robb McNaughton resigned. The board of directors of the Corporation is now comprised of Kent Tong, Andrew Janko and Robb McNaughton. Each of Doug Osrow, Laurie Goldberg and James Varanese will act as advisory board members until they have each received certain gaming regulatory approval after which they will be formally appointed to the board of directors of the Corporation. Graham Martin will become an advisory board member once his submission to the gaming regulator has been completed and will join the board of directors of the Corporation once applicable regulatory approval has been obtained. Each of James Varanese and Graham Martin will be joining the board of directors as representatives of Catalyst, subject to receiving applicable gaming regulatory approvals.
In addition, Kent Tong was appointed as the President and Chief Executive Officer of the Corporation and Danielle Thorkelsson was appointed as the Chief Financial Officer of the Corporation. In order to comply with Hong Kong corporate law, the Corporation has appointed Ashwood Management Co Ltd. as Corporate Secretary of the Corporation. Kent Tong was also appointed as Executive Corporate Secretary of the Corporation to provide oversight to the Corporate Secretary and to attend to executive matters related to the Corporate Secretary position to the extent permitted by corporate law.
Immediately after the closing of the Amalgamation, a total of 621,658 options to purchase Ordinary Shares previously issued to officers and directors of eQube or the Corporation were exercised, including 132,000 options to purchase Ordinary Shares exercised by Kent Tong. Upon completion of the Amalgamation and the exercise of such options, there were 29,482,727 Ordinary Shares issued and outstanding. In addition, the Corporation granted options to purchase 1,300,000 Ordinary Shares to certain directors, officers, employees, management company employees and consultants of the Corporation immediately after the closing of the Amalgamation.
The Shares are currently suspended from trading and are to remain suspended from trading until final acceptance of the Transaction by the Exchange. Assuming the Exchange grants final acceptance of the Transaction, it is anticipated that the Ordinary Shares will resume trading on the Exchange shortly after the Exchange issues its final approval of the Transaction as the Qualifying Transaction of Triox under the new name "eQube Gaming Limited", on a post-Consolidation basis and under the trading symbol "EQG".
This news release contains "forward-looking information" within the meaning of applicable securities laws relating to the proposal to complete the Transaction and associated transactions, including statements regarding the use of proceeds of the Offerings. Although the Corporation believes in light of the experience of its officers and directors, current conditions and expected future developments and other factors that have been considered appropriate that the expectations reflected in this forward-looking information are reasonable, undue reliance should not be placed on them because the Corporation 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 of the failure to obtain final acceptance by the Exchange of the Qualifying Transaction. The use of proceeds of the Offerings may change as may be determined by the Corporation. The Corporation undertakes no obligation to comment on analyses, expectations or statements made by third-parties in respect of the Corporation, eQube, their securities, or their respective financial or operating results (as applicable).
Neither the TSX Venture Exchange, Inc. nor its Regulation Services Provider (as that term is defined in the polices of the TSX Venture Exchange) has in any way passed upon the merits of the Qualifying Transaction and associated transactions and neither of the foregoing entities has in any way approved or disapproved of the contents of this press release.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
The shares in the capital 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.