TransGaming Inc.

TransGaming Inc.

August 23, 2016 14:58 ET

TransGaming Announces Date of Special Meeting of Shareholders and $1.168 Million Investment by Plazacorp Holdings Limited

TORONTO, TORONTO--(Marketwired - Aug. 23, 2016) - TransGaming Inc. (TSX VENTURE:TNG) (the "Company" or "TransGaming") is pleased to announce that it will hold a special meeting of its shareholders on September 16, 2016 (the "Meeting") for the purposes of approving (i) a change of business from one focused on the digital distribution of games for Smart TVs, next-generation set-top boxes and over-the-top devices, to that of lending to, investing in and financing real estate transactions (the "Proposed COB") under the rules of the TSX Venture Exchange (the "TSXV"), (ii) the sale of TransGaming's GameTree TV business (the "Sale of Assets"), (iii) the creation of a new Control Person (as that term is defined in the polices of the TSXV) in connection with the private placement by TransGaming of $1,168,125 of subscription receipts to Plazacorp Holdings Limited (the "Plazacorp Financing"), (iv) the election of new directors of the board of directors of the Company (the "New Directors"), (v) a consolidation of the common shares of TransGaming by a ratio of up to 35:1 (the "Consolidation"), (vi) a change of the name of the Company to "Findev Inc." (the "Name Change"), (vii) the offering by the Company of mezzanine financing credit facilities to Plazacorp Investments Limited and/or its affiliated companies (the "Credit Facility"), and (viii) certain amendments to the TransGaming stock option plan (the "Plan Amendments" and, together with the Sale of Assets, the Plazacorp Financing, the New Directors, the Consolidation, the Name Change and the Credit Facility, the "Other Transactions").

The record date for the purpose of determining the holders of common shares entitled to receive notice of and attend the Meeting and vote thereat is August 22, 2016. The management information circular (the "Circular") relating to the Meeting provides significant disclosure with respect to the matters to be submitted to the Meeting and will be filed under the Company's profile at


TransGaming is also pleased to announce that, consistent with its plans previously announced via news release dated May 9, 2016 as part of the Proposed COB, it entered into a subscription agreement for subscription receipts with Plazacorp Holdings Limited ("Plazacorp Holdings") on August 22, 2016 pursuant to which Plazacorp Holdings acquired 77,875,000 pre-Consolidation subscription receipts from the Company at a purchase price of $0.015 per subscription receipt for gross cash proceeds of $1,168,125 (the "Proceeds"). These subscription receipts will entitle Plazacorp Holdings to receive, upon exchange, 2,225,000 post-Consolidation common shares at a deemed price of $0.525 per post-Consolidation common share.

Proceeds from the Plazacorp Financing will be held in escrow pending satisfaction of certain release conditions (the "Escrow Release Conditions") related to the completion of the Proposed COB. If the Escrow Release Conditions are not met, the Plazacorp Financing will not close and the funds will be returned to Plazacorp Holdings without interest. Once the Escrow Release Conditions are satisfied and the Proceeds are released from escrow to TransGaming, the proposed use of the Proceeds shall be to fund real estate investments as described in the Circular. The 2,225,000 post- Consolidation common shares to be issued to Plazacorp Holdings would constitute forty percent (40%) of the issued and outstanding post-Consolidation common shares of the Company, thereby rendering Plazacorp Holdings a Control Person of the Company.


The Company announced its intention to proceed with the Proposed COB via news release dated May 9, 2016. If completed, the Proposed COB will constitute a "Change of Business" under Policy 5.2 of the TSXV and is conditional upon, among other things, the Company obtaining TSXV and shareholder approval.

Upon completion of the Proposed COB, the Company will become a Tier 1 investment company. If the Proposed COB does not obtain regulatory and shareholder approval, the Company will not proceed with the Other Transactions. In such circumstances, the Board will reconsider the strategic objectives of the Company and report back to the shareholders.


Sale of Assets

TransGaming announced via news release dated August 16, 2016 that it had entered into an asset purchase agreement with TransGaming Interactive UK Limited, a subsidiary of General Media Ventures Ltd., through which it is proposing a sale of its GameTree TV business in conjunction with the Proposed COB. The financial terms of the Sale of Assets will be fully disclosed in the Circular and the completion of the Sale of Assets will be conditional upon, among other things, the Company obtaining TSXV and shareholder approval.

Amendment of Stock Option Plan

The primary amendment to the current stock option plan, which will only be effective upon receipt of shareholder and TSXV approval, is a change from a fixed number stock option plan to a rolling stock option plan, with the maximum number of shares reserved for issuance being equal to ten percent (10%) of the issued and outstanding shares of TransGaming as at the date of the grant of an option under the amended stock option plan. For further details and information about the amendments to the stock option plan, please see the Circular.

Election of New Directors

The Company is seeking shareholder approval to establish a new board of directors comprised of six (6) individuals, four (4) of whom would be independent of Plazacorp Holdings. They include: Mr. Anthony Heller, President, Plazacorp Investments Limited, Mr. Sruli Weinreb, Founder and Managing Partner, Plaza Capital Limited, Mr. Brice Scheschuk, CEO, Globalive Capital and Globalive Communications and current Chair of TransGaming's Board, Mr. David Roff, Partner, Globalive Capital, Mr. Niall Finnegan, President, Finnegan Marshall Inc., and Mr. Devon Cranson, President, Cranson Capital.


TransGaming proposes to consolidate its common shares by a ratio of up to 35:1. Based on TransGaming's 116,797,889 currently issued and outstanding common shares with a market trading price of $0.02 per share, the proposed Consolidation would result in 3,337,082 issued and outstanding post-Consolidation common shares, each with a market price of $0.70 per share.

Name Change

The Company proposes to change its name to "Findev Inc." following the Proposed COB.

Credit Facility

TransGaming will also seek out the necessary shareholder and regulatory approval of the establishment of a secured revolving term credit facility to be made available by the Company to Plazacorp Investments Limited and its affiliates as mezzanine financing for certain condominium development projects in the Greater Toronto Area, with such credit facility to be evidenced by a credit agreement between the Company and Plazacorp Investments Limited. For further details and information about the Credit Facility, please see the Circular.


Shareholder approval of not less than 66 2/3% of the shares voting in person or by proxy at the Meeting will be required to approve the Sale of Assets, the Consolidation and the Name Change. The resolutions approving the Proposed COB, the Plazacorp Financing, the New Directors, the Credit Facility and the Plan Amendments require approval by a simple majority of the votes cast by shareholders present in person or represented by proxy at the Meeting.


In connection with the proposed COB and Other Transactions, the Company expects to complete an arm's length brokered private placement of a minimum of 16,666,666 subscription receipts and up to a maximum of 33,333,333 subscription receipts at a price per subscription receipt of $0.60 resulting in gross proceeds to the Company of a minimum of $10,000,000 and up to a maximum of $20,000,000 (the "Private Placement"). Each subscription receipt shall be automatically exercisable into one post-Consolidation common share upon the satisfaction of certain escrow release conditions. In addition, each subscription receipt will include, at no additional cost, one common share purchase warrant in the capital of the Company for each post- Consolidation common share issued. Each warrant shall be exercisable for a period of 36 months from the date of completion of the Private Placement, into one post- Consolidation common share at an exercise price of $0.70.

The proceeds from the Private Placement will be held in escrow and will be released to the Company subject to and conditional upon (i) the satisfaction of all conditions precedent to the Proposed COB and Other Transactions, and (ii) the receipt of all required regulatory approvals necessary to complete the Proposed COB and Other Transactions (including, without limitation, the conditional approval of the TSXV). If the escrow release conditions are not satisfied, the subscription receipts issued in the Private Placement will immediately become null, void and of no further force or effect and the escrowed proceeds will be returned to the holders on a pro-rata basis.

Cranson Capital Securities Inc. (the "Agent") will act as the agent for the Private Placement. The Company shall pay the Agent an initial work fee of $10,000 upon confirmation of shareholder approval for the Proposed COB and a cash amount equal to six percent (6.0%) of the aggregate proceeds of the Private Placement raised by the Agent. For further details and information about the Private Placement, please see the Circular.


The TSXV has conditionally approved the Change of Business, Other Transactions and Private Placement, subject to TransGaming fulfilling all of the requirements of the TSXV including receipt of shareholder approval where applicable.


Completion of the Proposed COB and Other Transactions is subject to a number of conditions, including TSXV acceptance and shareholder approval. The Proposed COB and Other Transactions cannot close until the required shareholder approval is obtained. TSXV approval of the Private Placement is also required. There can be no assurance that the Proposed COB, Other Transactions and Private Placement will be completed as proposed or at all.

Investors are cautioned that, except as disclosed in the management information circular to be prepared in connection with the Proposed COB, Other Transactions and Private Placement, any information released or received with respect thereto may not be accurate or complete and should not be relied upon. Trading in the securities of TransGaming Inc. should be considered highly speculative.

The TSX Venture Exchange Inc. has in no way passed upon the merits of the Proposed COB, Other Transactions and Private Placement, and has neither approved nor disapproved the contents of this press release.

On behalf of the Company,

Dennis Ensing, CEO


Forward-Looking Statements

Certain statements in this document may constitute "forward-looking" statements, which involve known and unknown risks, uncertainties and other factors which may cause our actual results, performance or achievements, or industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. When used in this document, such statements use words like "may", "will", "expect", "continue", "believe", "plan", "intend", "would", "could", "should", "anticipate" and other similar terminology. These statements reflect current assumptions and expectations regarding future events and operating performance and speak only as of the date of this document. Forward-looking statements involve significant risks and uncertainties, should not be read as guarantees of future performance or results, and will not necessarily be accurate indications of whether or not such results will be achieved. A number of factors could cause actual results to vary significantly from the results discussed in the forward-looking statements, including, but not limited to, the factors discussed under the "Risk Factors" section of the Company's the most recently filed Annual Report which is available on SEDAR at

Although the forward-looking statements contained in this document are based upon what we believe are reasonable assumptions, we cannot assure investors that our actual results will be consistent with these forward-looking statements. We assume no obligation to update or revise these forward-looking statements to reflect new events or circumstances, except as required by securities law.

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