Quisitive Technology Solutions, Inc.
(“Quisitive”
or the
“Company”) (TSXV: QUIS, OTCQX: QUISF), a
premier Microsoft Solutions Provider and Payment Solutions
Provider, has entered into an agreement pursuant to which
Scotiabank and Eight Capital (collectively, the
“
Underwriters”), have agreed to purchase, on a
“bought deal” basis, 17,200,000 common shares in the capital of the
Company (the “
Offered Shares”) at a price of
C$0.35 per Offered Share (the “
Issue Price”) for
aggregate gross proceeds to Quisitive of approximately C$6 million
(the “
Offering”). The Company has granted the
Underwriters an option, exercisable, in whole or in part, at any
time not later than the 30th day following the closing of the
Offering, to purchase up to an additional 2,580,000 Offered Shares
at the Issue Price for market stabilization purposes and to cover
over-allotments, if any (the “
Over-Allotment
Option”). If the Over-Allotment Option is exercised in
full, the total gross proceeds of the Offering will be
approximately C$6.9 million.
Ewing Morris & Co. Investment Partners Ltd.,
on behalf of certain funds managed by it, (“Ewing
Morris”) has agreed to participate in the Offering with an
investment amount of approximately C$5 million.
The net proceeds from the Offering are expected
to be used to partially fund the acquisition of sales residuals
(the “Sales Residuals”) held by certain sales
representatives of the Company (the “Vendors”),
(the “Transaction”), and for general working
capital. The impact of the Sales Residuals repurchase is expected
to result in an immediate increase to the Company’s gross margin
and EBITDA margin. The Transaction is expected to close in July
2023.
In connection with the Offering, the
Underwriters will receive a cash commission equal to 6% of the
gross proceeds from the sale of the Offered Shares (including any
Offered Shares issued pursuant to the exercise of the
Over-Allotment Option).
The Closing of the Offering is expected to occur
on or about June 30, 2023 and is subject to the approval of the TSX
Venture Exchange (“TSXV”) and other necessary
regulatory approvals.
The Offered Shares will be offered by way of (i)
a prospectus supplement (the “Prospectus
Supplement”) to Quisitive’s short form base shelf
prospectus dated August 29, 2022, which Prospectus Supplement is
expected to be filed with the securities commissions and other
similar regulatory authorities in each of the provinces and
territories of Canada, other than Quebec, on or prior to June 23,
2023; (ii) subject to the written consent of the Company, in the
United States by way of private placement pursuant to exemptions
from registration provided for under Rule 144A of the United States
Securities Act of 1933, as amended; and (iii) in jurisdictions
outside of Canada and the United States as are agreed to by the
Company and the Underwriters on a private placement or equivalent
basis.
About Quisitive:Quisitive
(TSXV: QUIS, OTCQX: QUISF) is a premier, global Microsoft partner
that harnesses the Microsoft cloud platform and complementary
technologies, including custom solutions and first-party offerings,
to generate transformational impact for enterprise customers. Our
Cloud Solutions business focuses on helping enterprises move,
operate, and innovate in the three Microsoft clouds. Our Payments
Solutions division leverages the PayiQ platform powered by
Microsoft Azure to transform the payment processing industry into
an entirely new source of customer engagement and consumer value.
Quisitive serves clients globally from seventeen employee hubs
across the world. For more information, visit www.Quisitive.com and
follow @BeQuisitive.
Quisitive Investor ContactMatt
Glover and John YiGateway Investor
RelationsQUIS@gatewayir.com949-574-3860
Quisitive Management Contact
Mike ReinhartPresident and Chief Executive
Officermike.reinhart@quisitive.com949-574-3860
Tami AndersChief of Stafftami.anders@quisitive.com
Financial Measures There are
measures included in this news release that do not have a
standardized meaning under generally accepted accounting principles
(GAAP) and therefore may not be comparable to similarly titled
measures and metrics presented by other publicly traded companies.
The Company includes these measures because it believes certain
investors use these measures and metrics as a means of assessing
financial performance. EBITDA (earnings before interest, taxes,
depreciation and amortization is calculated as net earnings before
finance costs (net of finance income), income tax expense, and
depreciation and amortization of intangibles) is a non-GAAP
financial measure that does not have any standardized meaning
prescribed by IFRS and may not be comparable to similar measures
presented by other companies.
Cautionary Note Regarding
Forward-Looking Information and StatementsThis news
release contains certain “forward-looking information” within the
meaning of applicable Canadian securities legislation and may also
contain statements that may constitute “forward-looking statements”
within the meaning of the safe harbor provisions of the United
States Private Securities Litigation Reform Act of 1995. All
statements, other than statements of historical fact, are
forward-looking statements and are based on expectations, estimates
and projections as at the date of this news release. Generally, any
statement that involves discussions with respect to predictions,
expectations, beliefs, plans, projections, objectives, assumptions,
future events or performance (often but not always using phrases
such as "expects", or "does not expect", "is expected",
"anticipates" or "does not anticipate", "plans", "budget",
"scheduled", "forecasts", "estimates", "believes" or "intends" or
variations of such words and phrases or stating that certain
actions, events or results "may" or "could", "would", "might" or
"will" be taken to occur or be achieved) are not statements of
historical fact and may be forward-looking information or
statements. The forward-looking information or statements in this
news release may relate, among other things, to: the completion of
the Transaction, the completion of the Offering, including receipt
of all regulatory approvals; the anticipated benefits of the
Transaction to Quisitive and its shareholders; the future growth
potential of the Company on a post-Transaction basis; the accretive
nature of the Transaction; and future financial performance
including statements with respect to anticipated additional cash
flows.
These forward-looking statements are based on
reasonable assumptions and estimates of management of the Company
at the time such statements were made. Actual future results may
differ materially as forward-looking statements involve known and
unknown risks, uncertainties and other factors which may cause the
actual results, performance or achievements of the Company to
materially differ from any future results, performance or
achievements expressed or implied by such forward-looking
statements. Such factors, among other things, include: the expected
results from the completion of the Transaction; receipt of all
required regulatory approvals including the approval of the TSXV
for the Offering; risks that the estimated financial results will
differ from management’s expectations; changes in technology,
customer markets and demand for the Company’s services; the
efficacy of the Company’s software and product offering; sales and
margin risk; acquisition and integration risks; dependence on
economic and market conditions including, but not limited to,
access to equity or debt capital on favorable terms if required;
changes in market dynamics including business relationships and
competition; information system risks; risks associated with the
introduction of new products; product design risk; risks related to
the Company being a holding company; environmental risks; customer
and vendor risks; credit risks; tax and insurance related risks;
risks of legislative changes; risks relating to remote operations;
key executive risk; risk of litigation risks; risks related to
contracts with third party service providers; risks related to the
enforceability of contracts; risks related to the economy
generally; the limited operating history of the Company; reliance
on the expertise and judgment of senior management of the Company;
risks related to proprietary intellectual property and potential
infringement by third parties; risks relating to financing
activities including leverage; risks relating to the management of
growth; increased costs associated with the Company becoming a
publicly traded company; increasing competition in the industry;
risks relating to energy costs; reliance on key inputs, suppliers
and skilled labor; cyber-security risks; risks related to
quantifying the Company’s target market; risks related to industry
growth and consolidation; fraudulent activity by employees,
contractors and consultants; conflicts of interest; risks related
to the cost structures of certain projects; risks relating to
certain remedies being limited and the difficulty of enforcement of
judgments and effect service outside of Canada; risks related to
future dispositions; sales by existing shareholders; the limited
market for securities of the Company; price volatility of the
common shares of the Company; no guarantee regarding use of
available funds; currency fluctuations; and those factors described
under the heading "Risks Factors" described in the Company’s annual
information form dated May 23, 2023, and the Company's most recent
management discussion & analysis dated May 15, 2023, each
available on SEDAR. Although the forward-looking statements
contained in this news release are based upon what management of
the Company believes, or believed at the time, to be reasonable
assumptions, the Company cannot assure shareholders that actual
results will be consistent with such forward-looking statements, as
there may be other factors that cause results not to be as
anticipated, estimated or intended. Accordingly, readers should not
place undue reliance on forward-looking statements and information.
There can be no assurance that forward-looking information, or the
material factors or assumptions used to develop such
forward-looking information, will prove to be accurate. The Company
does not undertake any obligations to release publicly any
revisions for updating any voluntary forward-looking statements,
except as required by applicable securities law.
Neither the TSXV nor its Regulation
Services Provider (as that term is defined in the policies of the
TSXV) accepts responsibility for the adequacy or accuracy of this
news release.
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