TORONTO, July 19, 2021 /CNW/ - Kuuhubb Inc.
("Kuuhubb" or the "Company") (TSXV: KUU), a mobile
game development and publishing company focused on providing the
female audience with creative interactive gaming experiences, is
pleased to announce a convertible debenture financing (the
"Offering") for gross proceeds of €500,000. The Offering is
composed of unsecured debentures ("Debenture") each having a
face value of €1,000 and bearing interest at a rate of 12% per
annum, which will be calculated and payable quarterly.
The Offering is composed of two tranches. The Company has
completed the first tranche, resulting in aggregate gross proceeds
to the Company of €250,000. Each Debenture matures on October 17, 2021 (the "Maturity Date"),
unless the Debenture becomes due and is repaid prior to the
Maturity Date pursuant to the terms of the certificate representing
the Debentures, or the Debenture is converted into shares in the
capital of Puzzle Studios OY, an indirect wholly-owned subsidiary
of the Company, pursuant to the terms of the certificate
representing the Debentures, which shares shall represent, assuming
the completion of both tranches of the Offering, 25% of the
outstanding share capital of Puzzle Studios OY, representing a
valuation of €2,000,000. On the Maturity Date, the principal amount
of the Debentures and any accrued and unpaid interest thereon shall
be paid to each holder of Debentures by the Company in cash.
The subscribers under the Offering are one lender acting at
arm's length to the Company and Joki Capital Ou, a non-arm's length
party to the Company owned wholly by Messrs. Jouni Keränen and
Christian Kolster. Subscribers to
the Offering are also entitled to receive a bonus of 10,000 common
share ("Share") purchase warrants ("Warrants") of the
Company per Debenture, for a total of 5,000,000 Warrants. In
connection with the completion of the first tranche, the
subscribers received a total of 2,500,000 Warrants. Each Warrant
entitles the holder to purchase one Share ("Warrant Share")
for a period of twenty-four months after closing at a price of
CAD$0.10 per Warrant Share. In
addition if (i) the Debenture is redeemed or retracted in
accordance with the terms therein; or (ii) the trading price of the
Shares on the TSX Venture Exchange ("TSXV") closes at a
minimum of CAD$0.30 per Share for a
period of ten (10) consecutive trading days, the Company may, upon
the written consent of the holder of the Warrant, accelerate the
expiry date of the Warrants to the date which is (a) thirty (30)
days following the date upon which notice of the accelerated expiry
date is provided to the holders of the Warrants, or (b) such other
date as may be mutually agreed upon between the Company and the
holders of the Warrants. The Debentures, the Warrants, and Warrant
Shares (if issued) will be subject to a four-month and one day
statutory hold period, in addition to such other restrictions as
may apply under applicable securities laws in jurisdictions outside
of Canada. The Company intends to
use the proceeds from the Offering for general working capital
purposes. The Offering is subject to certain conditions including,
but not limited to, the receipt of all necessary approvals,
including approval of the TSX Venture Exchange.
Related Party Transaction
In connection with the Offering, Joki Capital Ou, a company
owned by Jouni Keränen and Christian
Kolster, acquired €100,000 principal amount of Debentures.
This is a "related party transaction" as such term is defined by
Multilateral Instrument 61-101 - Protection of Minority Security
Holders in Special Transactions ("MI 61-101"), requiring the
Company, in the absence of exemptions, to obtain a formal valuation
for, and minority shareholder approval of, the "related party
transaction". The Company relied on an exemption from the formal
valuation and minority shareholder approval requirements set out in
MI 61-101 as the fair market value of the participation in the
Offering by Joki Capital Ou did not exceed 25% of the market
capitalization of the Company, as determined in accordance with MI
61-101.
Early Warning Reporting Requirements
In connection with the closing of first tranche of the Offering,
Joki Capital Ou acquired ownership of €50,000 principal amount of
Debentures issued as part of the first tranche, representing 20% of
the presently issued and outstanding Debentures. Joki Capital Ou
also acquired ownership of 500,000 Warrants, representing 20% of
the issued and outstanding Warrants. Immediately prior to these
acquisitions, Joki Capital Ou did not own any Debentures or
Warrants.
Following completion of the Offering, Joki Capital Ou now owns
(i) 11,545,000 Common Shares (representing 17.32% of the presently
issued and outstanding common shares of the Company); (ii) €50,000
principal amount of Debentures issued as part of the first tranche
(representing 20% of the presently issued and outstanding
Debentures); and (iii) 500,000 Warrants, (representing 20% of the
issued and outstanding Warrants). Assuming the exercise in full of
the Warrants, Joki Capital Ou would own approximately 17.94% of the
issued and outstanding common shares of the Company on a partially
diluted basis.
Joki Capital Ou has acquired the Debentures and the Warrants for
investment purposes and may acquire further securities of Kuuhubb,
or dispose of its holdings of securities of Kuuhubb, both as
investment conditions warrant.
A copy of Joki Capital Ou's early warning report will appear on
the Company's profile at www.sedar.com and may also be obtained
from Jouni Keränen, CEO of the Company, at +358 40 590 0919 or
jouni@kuuhubb.com. Joki Capital Ou has its registered office
located at Rotermanni TN 8, Kesklinna District, Tallinn City, Harju Country, 10111 Estonia.
The Company's registered office is located at 25 Adelaide Street
East, Suite 1417, Toronto,
Ontario, M5C 3A1.
About Kuuhubb
Kuuhubb is a publicly listed mobile game development and
publishing company, targeting the female audience with bespoke
mobile experiences. Our Mission is to become a top player in the
female mobile game space. We believe in empowering women by
creating games and apps that will have our female audience relax,
express and entertain themselves every day. Through our games and
partnerships with select developers, we explore new lifestyle
trends that can be converted into games and apps which will bring
value to our users, employees, and shareholders. Headquartered in
Helsinki, Finland, Kuuhubb has a
global presence with a strong focus on U.S. and Asian markets.
Cautionary Note Concerning Forward-Looking
Information
This press release contains forward-looking information. All
statements, other than statements of historical fact, that address
activities, events or developments that the Company believes,
expects or anticipates will or may occur in the future are forward
looking information. This forward-looking information reflects the
current expectations or beliefs of the Company based on information
currently available to the Company. Forward-looking information is
subject to a number of risks and uncertainties that may cause the
actual results of the Company to differ materially from those
discussed in the forward-looking information, and even if such
actual results are realized or substantially realized, there can be
no assurance that they will have the expected consequences to, or
effects on the Company. Factors that could cause actual results or
events to differ materially from current expectations include,
among other thing: risks related to the growth strategy of the
Company; the possibility that results from the Company's growth
plans will not be consistent with the Company's expectations; the
early stage of the Company's development; competition from
companies in a number of industries; the ability of the Company to
manage expansion and integrate acquisitions into its business,
future business development of the Company; the ability to predict
and counteract the effects of COVID-19 on the business of the
Company, including but not limited to the effects of COVID-19 on
its business segments, capital market conditions, restrictions on
labour and international travel and supply chains; and the other
risks disclosed under the heading "Risk Factors" in the Company's
management discussion and analysis for the twelve months ended
June 30, 2020 filed on SEDAR at
www.sedar.com. Forward-looking information speaks only as of the
date on which it is provided and, except as may be required by
applicable securities laws, the Company disclaims any intent or
obligation to update any forward-looking information, whether as a
result of new information, future events or results or otherwise.
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.
Neither 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.
SOURCE Kuuhubb Inc.