BBTV Holdings Inc. (TSX: BBTV; OTCQX: BBTVF)
(“
BBTV” or the “
Company”) is
pleased to announce it has entered into an agreement pursuant to
which Eight Capital and Canaccord Genuity Corp., as co-lead
underwriters and joint bookrunners, together with a syndicate of
underwriters (collectively, the “
Underwriters”),
will purchase 15,000 convertible debentures of the Company (the
“
Convertible Debentures”), on a “bought deal”
basis pursuant to the filing of a short form prospectus, subject to
all required regulatory approvals, at a price per Convertible
Debenture of $1,000 (the “
Issue Price”) for gross
proceeds of $15,000,000 (the “
Bought Deal”).
The Company is also pleased to announce that it
has entered into a binding agreement with a long-term focussed,
major Canadian trillion dollar institutional asset manager for the
purchase and sale of 20,000 Convertible Debentures at the Issue
Price for gross proceeds of $20,000,000 (the “Private
Placement”), resulting in aggregate gross proceeds from
the Bought Deal and the Private Placement (together, the
“Convertible Debenture Financing”) of
$35,000,000.
“We are pleased to announce this financing
package which in our view is a strong endorsement from the
financial community of our mission, vision and execution of our
strategic business plan,” said Shahrzad Rafati, Chair and CEO of
BBTV. “This financing and deferment package is a significant boost
to the Company’s balance sheet which not only serves as a
definitive solution to our current debt load but also provides
capital to drive our growth initiatives including our M&A
program. We are grateful for the support of the participating
shareholders and believe their support is reflective of the strong
platform for growth that we’ve created at BBTV and our commitment
to provide content creators with best in class tech-enabled creator
monetization solutions.”
The Company has agreed to grant the Underwriters
an over-allotment option to purchase up to an additional 15% of the
Convertible Debentures issuable pursuant to the Bought Deal,
exercisable in whole or in part, at any time on or prior to the
date that is 30 days following the closing of the Bought Deal.
The Convertible Debentures will have a maturity
date of five years from the closing date of the Offering (the
“Maturity Date”) and will bear interest from the
date of closing at 7.0% per annum, payable annually December 31 of
each year. The Convertible Debentures will be convertible, at the
option of the holder, into subordinate voting shares of the Company
(the “Shares”) at any time prior to the close of
business on the last business day immediately preceding the
Maturity Date at a conversion price of $10.55 per Share (the
“Conversion Price”). The Company may force the
conversion of the principal amount of the then outstanding
Convertible Debentures at the Conversion Price on not less than 30
days’ notice if, at any time following the date that is 4 months
and 1 day following the Closing Date, the closing price of the
Shares is greater than $20.00 for the preceding 20 consecutive
trading days (a “Mandatory Conversion”). In the
event of a Mandatory Conversion prior to the 3-year anniversary of
the Closing Date (the “3-year Anniversary”), in
addition to any unpaid and accrued interest, the holders of
Convertible Debentures shall be entitled to an amount equal to
interest that would otherwise be payable from the time of the
Mandatory Conversion until the 3-year Anniversary.
The Company intends to use the net proceeds of
the Convertible Debenture Financing to: (i) to prepay $20,000,000
of the principal outstanding under the Company’s existing senior
secured convertible promissory loan (the “Debt
Prepayment”) with UFA Film und Fernseh GmbH (the
“Secured Convertible Loan”); (ii) for M&A
transactions; and (iii) for working capital and general corporate
purposes.
In connection with the Convertible Debenture
Financing, the Company has also entered into an agreement with its
senior secured lender, UFA Film und Fernseh GmbH, to amend the
terms of its Secured Convertible Loan (the “Secured
Convertible Loan Amendments”), including the
following:
- The maturity date will be extended
to the date that is 5 years from the finalization of the Secured
Convertible Loan Amendments;
- The Secured Convertible Loan will
bear interest at a rate of 8% per annum, from a current interest
rate that escalates from 8% presently to higher rates at the time
of maturity, payable at the end of the term;
- The Secured Convertible Loan can be
prepaid without penalty at any time;
- At maturity, the Secured
Convertible Loan will be convertible, at the option of the lender,
into Shares at a conversion price equal to the 5-day volume
weighted average trading price of the Shares immediately prior to
the maturity date, plus a 20% premium;
- 25% of the proceeds of future
offering of equity securities or debt by the Company are to be
applied to the prepayment of the Secured Convertible Loan; and
- Upon the Debt Prepayment, and after
adding accrued and unpaid interest to the principal amount of the
Secured Convertible Loan, the amount outstanding pursuant to the
Secured Convertible Loan will be approximately $29,000,000
(assuming that the Convertible Debenture Financing and the Debt
Prepayment completes on or about June 15, 2021).
The closing date of the Convertible Debenture
Financing and the Secured Convertible Loan Amendments is scheduled
to be on or about June 15, 2021 and is subject to certain
conditions including, but not limited to, the receipt of all
necessary approvals, including the approval of the TSX and the
applicable securities regulatory authorities.
This news 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 state in which such offer,
solicitation or sale would be unlawful. The securities being
offered have not been, nor will they 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 requirements of the
United States Securities Act of 1933, as amended, and
applicable state securities laws.
BBTV HOLDINGS INC.Per:
“Shahrzad Rafati”Shahrzad RafatiChief Executive Officer
About BBTV
BBTV is a global media and technology company
headquartered in Vancouver, Canada. The Company’s mission is to
help content creators become more successful. With creators ranging
from individuals to global media brands, BBTV provides a
comprehensive, end-to-end solution to increase viewership and drive
revenue powered by its innovative technology, while allowing
creators to focus on their core competency – content creation. In
January 2021, BBTV had the second most unique monthly viewers among
digital platforms with more than 600 million globally, who consumed
more than 50 billion minutes of video content, the most among media
companies1. (www.bbtv.com)
1Comscore’s “Top 12 Countries = January 2021
comScore Video Metrix Media Trend – Multi-Platform – Top 100 Video
Properties Report”; Top 12 countries represent ~50% of world’s
digital population.
Notice Regarding Forward Looking
Statements
This news release contains forward‐looking
information within the meaning of applicable securities
legislation, including statements with regards to: the offering and
closing of the Convertible Debenture Financing and the timing
thereof; the proposed use of proceeds from the Convertible
Debenture Financing; the closing of the Secured Convertible Loan
Amendments and the timing thereof; and that the deferment package
will be a solution to the Company’s current debt load and driver of
future M&A. Such forward-looking information reflects the
Company’s current expectations regarding future events.
Forward‐looking information is based on a number of assumptions and
is subject to a number of risks and uncertainties, many of which
are beyond the Company’s control, which could cause actual results
and events to differ materially from those that are disclosed in or
implied by such forward‐looking information. Such risks and
uncertainties include, but are not limited to, the inability of the
Company to close the Convertible Debenture Financing and Secured
Convertible Loan Amendments for any reason, risks inherent in the
technology, media, advertising, and creator economy sectors in
general, business disruption and operation risks related to
COVID-19, other factors beyond the control of the Company, and the
risk factors disclosed in the Company’s periodic reports publicly
filed and available at www.sedar.com. The Company does not
undertake any obligation to update such forward‐looking
information, whether as a result of new information, future events
or otherwise, except as expressly required by applicable law.
For further information
Media RelationsDan GambleHead
of PR & Corporate
Communications778-873-0422dgamble@bbtv.com
Investor
Relationsir@bbtv.com
Ron ShuttleworthPartnerOak Hill Financial
Inc(647)–500–7371rshuttleworth@oakhillfinancial.ca
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