(TheNewswire)
Montreal – TheNewswire - May 1, 2023 – ATWTech Inc. (the “ Company ” or“ ATW ”) ( TSXV:ATW ) is pleased to announce an update ona previously announced acquisition, its intention to complete afinancing in the amount of $1,550,000, and a change of auditor.
Acquisition
On June 21, 2022, the Company announced its intentionto proceed with the acquisition of two target entities andsubsequently provided an update on these transactions on November 25,2022. The Company intends to close the acquisition of one of these twocompanies (the “ Target ”) by May 31, 2023 (the“ Transaction ”).
The Target provides data analytics tools and expertconsulting services to help clients drive business transformationthrough sophisticated data strategies. Fueled by strong management,more than 15 seasoned employees and tailored analytics solutions, theTarget helps clients fast-track their data initiatives and drivetangible value in the fields of public safety, finance, retail andmore.
The base purchase price is $2,600,000, consisting of acombination of (i) $250,000 in cash (ii) the assumption of debt in anestimated amount of $500,000 and (iii) $1,850,000 in units of theCompany (the “ Units ”), each consisting of one common shareof the Company (a “ Share ”) together with a warrant entitlingthe holder to acquire one Share at an exercise price of $0.07 for aperiod of 36 months from the date of closing. The purchase price issubject to customary post-closing adjustments for working capital,transaction costs and net debt. This Transaction and the purchaseprice also remain subject to due diligence acceptable to ATW. ThisTransaction is at arm’s length and no finder’s fees are expectedto be paid by ATW in connection with the Transaction.
The Transaction is expected to close on or before May31, 2023. The Transaction is subject to a number of closingconditions, including the approval of the TSX Venture Exchange(“ TSXV ”).
Financing
In order to, among other things, finance theTransaction, the Corporation intends to complete a financing by way ofa private placement and two secured loans (the “ Financing ”).
The non-brokered private placement consists of19,500,000 Units at a price of $0.05 per Unit for aggregate grossproceeds of $975,000 (the “ Private Placement ”).
The Company expects to enter into secured loanagreements (the “ Loans ”) with each of (i) Gercanoit Inc.(“ Gercanoit ”), for an amount of $250,000 and (ii) Sifaben Hypothèques.e.c. (with Gercanoit, the “ Lenders ”), for an amount of $325,000. TheLoans have a maximum term of 12 months and bear interest at an annualrate of 18%. In addition, ATW may prepay all or a portion of the Loansat any time without penalty.
The proceeds of the Financing will be used by ATW, forthe benefit of ATW and its subsidiaries, for the Transaction and itsongoing operations.
The Financing is considered a “related partytransaction” within the meaning of Regulation 61-101 respecting Protection ofMinority Security Holders in Special Transactions (the “ Regulation61-101 ”), as (i) certain insiders, includingsenior officers and directors of the Corporation, are expected tosubscribe for up to an aggregate of 5,000,000 Units in the Private Placement, and (ii) the Lenders areinsider of a company controlled by an insider of the Corporation. TheFinancing is exempt from the formal valuation requirement and theminority shareholder approval requirement of Regulation 61-101(pursuant to sections 5.5(a) and 5.7(a)), asneither the fair market value of the Units to be distributed to theinsiders, nor the value of the consideration received in exchange forsuch Units, nor the value of the Loans exceeds 25% of the marketcapitalization of the Corporation. The Financing has been approved bythe independent directors of the Company. The Company did not file amaterial change report in respect of the Financing more than 21 daysprior to the closing date of the Financing for valid business reasonsin order to ensure that the closing took place within a time frameconsistent with the normal market practice for transactions of thisnature.
The securities issued under the Private Placement willbe subject to a four-month restricted trading period in accordancewith the applicable securities legislation. In addition, the PrivatePlacement is subject to the approval of the TSXV. Neither the TSXV norits Regulation Services Provider (as the term is defined in thepolicies of the TSXV) accepts responsibility for the adequacy oraccuracy of this release.
Change of Auditor
The Company has decided to replace its auditor, thefirm Raymond Chabot Grant Thornton S.E.N.C.R.L. (the “ Predecessor Auditor ”), with the firm Guimond Lavallée Inc. (the“ New Auditor ”).
The Predecessor Auditor has resigned as auditor of ATWon its own initiative, effective April 21, 2023. The Board ofDirectors of the Company has considered and approved the resignationof the Predecessor Auditor and the appointment of the New Auditor,effective April 21, 2023.
To date, there are no restrictions in the PredecessorAuditor’s reports for the fiscal years ended December 31, 2021 and2020, as they do not contain a modified opinion or reportable event asdefined in Regulation51-102 .
In accordance with Regulation 51-102 ,the notice of replacement auditor and the required letters from thePredecessor Auditor and the New Auditor have been reviewed by theBoard of Directors and will be duly filed on SEDAR.
ATW TECH PROFILE
ATW Tech is a technology company, owner of severalrecognized technology platforms such as Semeon Analytics, Option.voteand Voxtel. Semeon Analytics is a highly accurate and flexible textanalysis platform for customer reviews and uses a unique combinationof machine learning and natural language processing (NLP) to discoversignificant trends in customer reviews across all channels.Option.vote offers a customized multimethod voting system for unions,political parties, professional associations, and anyone looking for asecure way to reduce their voting costs and improve theirparticipation rate. VoxTel specializes in telephone billing andalternative payment solutions for fixed and mobile lines.
Forward-Looking Statements andDisclaimer
Certain statements in this pressrelease may be forward-looking. These statements include thoserelating to the Transactions, the closing date of the Transactions,the potential impact of the acquisitions on the Company, the abilityof the Company to raise funds in connection with the private placementand the use of the proceeds raised in connection with said privateplacement. Although the Company believes that such forward?lookingstatements reflect expectations based on reasonable assumptions, itcannot guarantee that its expectations will be realized. Theseassumptions, which may prove to be inaccurate, include, but are notlimited to, the following:
(i) All the conditions of thetransactions will be met. In particular, ATW will perform satisfactorydue diligence on the Targets’ operations, finances, legal status andother matters; (ii) ATW and the Targets’ shareholders will be able to negotiate andconclude a purchase agreement and other documents related to thetransaction; (iii) ATW will obtain the necessary regulatory approvalsfor the acquisition of the Targets on commercially reasonable terms;(iv) The acquisition of the Targets will enable ATW to realize theanticipated synergies; (v) ATW's officers will not set or achieve anyother strategic objectives using the proceeds of theFinancing. The factors thatmay affect the achievement of the expected results include (i) Thediscovery in the due diligence process of elements unfavorable to theTarget that would prevent ATW from proceeding with the purchase; (ii)The failure of negotiations between the parties with respect to finaldocumentation; (iii) The Company's inability to realize theanticipated synergies for any reason or due to technical issues thatprevent the integration of the Targets’ systems with those of ATW;(iv) The Company's inability to effectively use the proceeds of theprivate placement; (v) The Company's inability to obtain theregulatory approvals necessary for the acquisitions or the privateplacement; (vi) Labor disputes or the occurrence of similar risks;(vii) ) a deterioration in the financial market conditions thatprevent the Company from raising the required funds in a timelymanner, and (viii) the Company's inability to develop and implement abusiness plan in general and for any reason whatsoever. A description of the risksaffecting the Company’s business and activitiesappears under the heading "Risks and Uncertainties" onpages 10 and 11 of ATW's 2022 annual management's discussion andanalysis, which is available on SEDAR at www.sedar.com . No assurance can be given that anyevents anticipated by the forward-looking information in this pressrelease will transpire or occur, or if any of them do , the benefits that ATW will derive therefrom. In particular, noassurance can be given as to the future financial performanceof ATW . ATW disclaims any intentionor obligation to update or revise any forward-looking statements inorder to account for any new information or any other event. Thereader is warned against undue reliance on these forward-lookingstatements.
Additional information regarding ATWTech is available on SEDAR www.sedar.com
Source
ATW Tech Inc.
Michel Guay
Founder, president and CEO
mguay@atwtech.com
www.atwtech.com
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