TORONTO, Nov. 30, 2020 /CNW/ - Globalive Technology
(TSX-V: LIVE) (the "Company"), a technology company based in
Toronto, Ontario, today announced
its financial and operational results for the third quarter of 2020
(the "Reporting Period").
For a summary of the financial results, see the Selected Q3
Financial Highlights set out below as well as more detailed
information contained in the Company's interim financial statements
and related management discussion and analysis quarterly highlights
which are available on the Company's SEDAR page at
www.sedar.com.
SELECTED Q3 OPERATIONAL HIGHLIGHTS
Key operational developments for the Company in the third
quarter of 2020 included:
- Reverse Take-Over Transaction: On June 3, 2020, the Company entered into a binding
letter of intent with Socati Corp. ("Socati") to complete a
reverse take-over transaction whereby the Company would acquire all
of the issued and outstanding securities of Socati, valued in
aggregate at US $25,000,000, in
exchange for common shares of the Company. Socati is a leading
processor of THC-free broad-spectrum hemp extracts and ingredients
for use in cannabinoid products. On July 13,
2020, the Company entered into a second binding letter of
intent with Yooma Corp. ("Yooma") to complete a reverse
take-over transaction whereby the Company would acquire all of the
issued and outstanding securities of Yooma, valued in aggregate at
US $25,000,000, in exchange for
common shares of the Company. Yooma operates an Asia-focused social commerce company with
particular depth in the Chinese e-commerce market. On September 22, 2020, following discussions between
the three parties, the letter of intent between the Company and
Socati was terminated and the letter of intent between the Company
and Yooma was amended so that the Company and Yooma could focus on
completing a two-party reverse takeover transaction as soon as
possible (the "RTO Transaction").
The details of the RTO Transaction
are described in a press release issued by the Company on
July 13, 2020 (the "RTO Press
Release") and in the Company's management discussion and
analysis for the Reporting Period. A copy of the binding
letter of intent between the Company and Yooma, together with any
amendments to that letter, (collectively, the "RTO Letter")
have been posted on SEDAR at www.sedar.com.
Some of the material, high-level
features of the RTO Transaction are expected to be as follows:
- The Company will purchase all of the issued and outstanding
securities of Yooma at an aggregate valuation of USD $25,000,000. The purchase price will be paid in
common shares of the Company issued at a share price equal to: (i)
USD $500,000, plus (ii) the value of
any cash left in the Company on closing, currently estimated to be
USD $4,500,000, divided by (iii) the
total number of issued and outstanding common shares of the Company
immediately prior to closing.
- The Company's existing business, assets and liabilities,
including its technology venture subsidiaries, any intellectual
property and some or all of its technology investments (the
"Legacy Assets") will be transferred to a third-party with
the value of the Legacy Assets captured or distributed to the
shareholders of the Company immediately prior to closing the RTO
Transaction.
- On completion of the RTO Transaction, the resulting issuer will
be delisted from the TSX Venture Exchange and will be listed to
trade on the Canadian Securities Exchange ("CSE"). The
resulting issuer will carry on the business of Yooma under a new
name and new management team.
- The RTO Transaction is subject to a number of conditions
precedent, including but not limited to the Company continuing to
be listed on the TSX Venture Exchange (prior to completion of the
RTO Transaction); director and shareholder approval of each entity
involved in the RTO Transaction; receipt of any necessary
regulatory and third-party approvals or consents; no material
adverse change in the business of any of the entities participating
in the RTO Transaction; the Company holding cash and
cash-equivalents on closing of no less than USD $4,500,000; the completion of certain pre-closing
matters including the transfer of the Legacy Assets; and other
conditions typical for a transaction of this nature.
- The Company and Yooma had previously announced that they might
complete an equity financing of up to USD $5,000,000 to close concurrently with the RTO
Transaction, however, at this time the parties do not expect that
such a financing will be necessary.
Concurrently with the initial
announcement of the RTO Transaction, a trading halt was imposed on
the Company's common shares which will remain in place until the
Company is able to disclose certain prescribed details about the
RTO Transaction and the anticipated resulting issuer. The Company
and Yooma are working diligently to negotiate and implement
definitive agreements for the RTO Transaction and to provide the
required disclosure and will update the public through a press
release as soon as reasonably possible.
While the RTO Letter is binding,
there can be no assurance at this time that the RTO Transaction
will be completed or that it will be completed on the terms
described in this press release, the RTO Press Release and the RTO
Letter. Investors are cautioned that, except as disclosed in any
management information circular or filing statement prepared in
connection with the RTO Transaction, any information released or
received with respect to the RTO Transaction may not be accurate or
complete and should not be relied upon. Trading in the Company's
securities in anticipation of the RTO Transaction should be
considered highly speculative.
- Interest in the Flexiti Group: The Company holds
several debt and equity interests in Flexiti Financial Inc., a
Canadian point of sale retail lender, its parent company, FLX
Holding Corp., (collectively with their affiliates, the "Flexiti
Group") and their controlling shareholder, 2629331 Ontario Inc.
The Company continues to support the efforts of the Flexiti Group
to raise financing to grow their business, including most recently
through a financing and sales process lead by a global investment
bank.
- Normal Course Issuer Bid: The Company
launched a normal course issuer bid program ("NCIB") to
purchase for cancellation up to 5% of its then issued and
outstanding common shares (350,145 common shares) by December 31, 2020. The program was first
announced on January 16, 2020 and the
Company began making purchases on February
3, 2020. The program is an automatic securities purchase
plan, such that the specific timing of any share purchase under the
program is determined by the Company's broker in accordance with
applicable laws (including a restriction preventing the Company
from buying more than 2.0% of its then issued and outstanding
common shares in any 30-day period) and standing instructions from
management with respect to such matters as maximum price and total
funds available for purchases. There can be no assurance as to the
precise number of common shares that will be repurchased under the
program, or the price at which they will be purchased, and the
Company may discontinue purchasing at any time subject to
compliance with applicable legal and regulatory requirements. Due
to the trading halt imposed on the Company's common shares in
connection with the RTO Transaction, no purchasing has occurred
under the NCIB since June 3, 2020. If
the RTO Transaction proceeds, the NCIB program will be cancelled
automatically in accordance with its terms.
- Wind-Down of Certain Business: During
the Reporting Period the Company began the process of dissolving
two subsidiaries that were established in 2018 for a business
venture that was not ultimately pursued. Globalive Exchange
Services Inc. was dissolved on September 7,
2020, and the Company anticipates that Globalive Exchange
Services (UK) Ltd. will be dissolved in the coming months. These
subsidiaries did not hold material assets or generate revenue.
After the end of the Reporting Period, but prior to the MD&A
Date, the Company's Chief Operating Officer departed the Company on
mutually agreeable terms and is not expected to be replaced, having
regard to the wind-down of a substantial portion of the Company's
operating business and the anticipated RTO Transaction.
SELECTED Q3 FINANCIAL HIGHLIGHTS
Key financial characteristics of the Company for its four most
recently completed quarters were:
|
Sep 30,
2020
|
Jun 30,
2020
|
Mar 31,
2020
|
Dec 31,
2019
|
|
Cash
|
6,750,333
|
7,462,240
|
8,138,162
|
8,860,276
|
|
Working
capital*
|
5,779,107
|
6,377,125
|
7,080,861
|
8,764,497
|
|
Total
Assets
|
19,157,970
|
19,924,047
|
20,267,756
|
24,205,551
|
|
Total
Liabilities
|
(1,043,748)
|
(1,185,067)
|
(1,169,213)
|
(152,807)
|
|
Realized /
unrealized gain (loss) from investments
held at fair value through profit or loss
|
(26,740)
|
271,828
|
(3,477,390)
|
1,223,952
|
|
Net income (loss)
before taxes for the period
|
(866,606)
|
(456,791)
|
(4,066,897)
|
(2,217,232)
|
|
Deferred tax
recovery (expense)
|
-
|
-
|
-
|
-
|
|
Net income (loss)
from continuing operations for
the period
|
(866,606)
|
(456,791)
|
(4,066,897)
|
(2,217,232)
|
|
Net income (loss)
from discontinued operations
for the period (attributable to equity holders of the
company)
|
-
|
-
|
-
|
-
|
|
Net income (loss)
and comprehensive income (loss)
for the period
|
(866,606)
|
(456,791)
|
(4,066,897)
|
(2,217,232)
|
|
* Note that "working
capital" does not have any standardized meaning prescribed by IFRS
and may not be comparable to similar measures presented by other
companies. Working capital consists of current assets minus current
investments minus current liabilities plus promissory notes.
Working capital excludes any digital assets and investments.
Working capital should not be considered in isolation or as an
alternative or substitute from measures prepared in accordance with
IFRS (such as Net and Comprehensive Income)
|
The Company's losses for the most recently completed quarter
were driven primarily by standard operating expenses and unrealized
foreign exchange losses on investments and deposits held in USD,
partially offset by increases in the unrealized value of certain of
the Company's investments, including some investments that were
revalued to track the performance of similar companies through the
use of the Russell 2000 index. Please refer to the Company's
interim financial statements and corresponding management
discussion and analysis for further detail.
ABOUT GLOBALIVE TECHNOLOGY
Globalive Technology is a next generation software company and
venture partner that is developing and investing in innovative
solutions to disrupt traditional industries. The company forms
partnerships with leading high growth companies to develop and
commercialize software solutions using optimal technology stacks.
It 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 $10M to
$1.3B USD, has made over 100 venture
investments and has over 45 technology companies in its portfolio.
For more information, visit www.globalivetech.com.
CAUTION REGARDING FORWARD-LOOKING INFORMATION
This news release contains forward-looking statements
relating to the Company, the proposed reverse take-over transaction
with Yooma, its investments and its future business plans. Such
forward-looking statements are identified by terms such as
"expected to be", "will", "will be", "subject to", "expect, "may",
"anticipates", "anticipated", "expected", "continues to",
"estimated" 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 the Company's business focus or strategic plan;
changes in market and industry conditions; unexpected operating
gains or losses; management's assessment of the viability of
different businesses and business partners; a breakdown in the
Company's relationship with its existing or potential future
business partners; changes in the Company's management and
employees; the negotiation of definitive documents and the
satisfaction of the conditions precedent to completing any existing
business or transactional opportunities, including the proposed
reverse take-over transaction with Yooma; the availability of
adequate financing and regulatory, shareholder and third-party
approvals for the reverse take-over; other parties seeking to
acquire an interest in the Company, Yooma or any entities in which
the Company has investments; difficulties or delays in the
development of new technologies; technologies not functioning as
expected; third parties not using technologies and services as
expected; economic conditions making certain technologies or
services less attractive than anticipated; competitors in the
industry; the potential effect of the COVID-19 pandemic on existing
and potential transactional opportunities, the availability of
financing, the performance and viability of the Company's business
ventures, business partners and investee technology companies; the
COVID-19 pandemic impacting on the availability of financing, the
COVID-19 pandemic introducing business interruptions due to
illness, work-from home policies or supply chain disruptions
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.
Neither the 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 Globalive Technology
