(TheNewswire)
Edmonton, Alberta – TheNewswire - May 20, 2022 – New Media Capital 2.0Inc. (“ New Media ” or the“ Company ”) (TSXV:NEME.P),a “capital pool company” pursuant to the policies of the TSXVenture Exchange (the “ TSXV ”), and Hypersonix Launch Systems Ltd. are pleased toannounce certain updates in connection with the proposed reversetakeover of New Media and Hypersonix to be effected byway of a court-supervised scheme of arrangement under the laws of Australia (the “ Qualifying Transaction ”). TheQualifying Transaction is intended to constitute New Media’s“Qualifying Transaction” (within the meaning of Policy 2.4 – Capital Pool Companies of the TSXV) . As a result of the Qualifying Transaction, it isexpected that Hypersonix will become a wholly-owned subsidiary of NewMedia (the “ Resulting Issuer ”following completion of the Qualifying Transaction) . The completion of the QualifyingTransaction is subject to a number of conditions including obtainingthe final approval of the TSXV.
Updates to the Concurrent Financing
Further to the press release of the Company dated February 4, 2022,Hypersonix has engaged Research Capital Corporation (the“ Lead Agent ”) to act as lead agent and solebookrunner (on its own behalf an on behalf of a syndicate of agentswhich may be formed (collectively, the “ Agents ”)) inconnection with the private placement offering (the “ Concurrent Offering ”) of subscription receipts (the “ Subscription Receipts ”) by Hypersonix. TheConcurrent Financing is a best-efforts offering of approximately 4,166,666 Subscription Receipts at a price ofC$1.20 per Subscription Receipt , which will provide tothe Company aggregate gross proceeds of approximately C$5,000,000. Additional grants awarded to the Company by the Australian, FederalGovernment. (see below) will result in the receipt of approximatelyA$10,950,000 (amounting to approximately C$9,800,000) by Hypersonixand its partners.
These grants are in addition to the previousAccelerating Commercialisation Program grant (“ACA”) awarded in2020, which enabled the production and testing of a SPARTAN engine byadditive manufacturing (“3D printing”), and associated Hydrogenfuel system, in full satisfaction of all conditions of the grant, andon budget. The A$8,000,000 Modern Manufacturing Initiative(“MMI”) grant awarded under the Australian federal Defencetranslation Stream will fund the first launch of an entirely 3Dprinted DART hypersonic unmanned aerial vehicle (“UAV”). The Cooperative Research Centres Projects(“ CRC-P ”) grant awarded by the Department of Industry, Science,Energy and Resources will be used to develop acomposite version of the DART AE as another technology demonstrator. Hypersonix believes that these DART AE andDART CMP programs will demonstrate key factors of its future largerOrbiter, including scalability of manufacture, reliability, costeffectiveness and high cadence of manufacture. These factors supportHypersonix’ vision of enabling multiple low-cost launches in a shorttime frame for both civilian and defence applications.
EachSubscription Receipt will automatically be exchanged into one unit ofHypersonix (a “ Unit ”) onthe satisfaction or waiver of certain escrow release conditions (the“ Release Conditions ”) inaccordance with the terms of a subscription receipt agreement to beentered into on the closing of the Concurrent Financing amongHypersonix, NMC, the Lead Agent, on behalf of the Agents, and TSXTrust Company, as subscription receipt agent, without the payment ofadditional consideration or the taking of further action on the partof the subscriber. Each Unit will consist of one ordinary share in thecapital of Hypersonix (a “ Hypersonix Share ”) and one-half of one share purchasewarrant of Hypersonix (a “ Warrant ”). Each Warrant will be exercisable toacquire one Hypersonix Share at an exercise price of C$2.25 for aperiod of 24 months from the date of the satisfaction of the ReleaseConditions.
The gross proceeds of the Concurrent Financing, lessthe Agents’ expenses, will be held in escrow pending thesatisfaction of the Release Conditions. In the event that theQualifying Transaction does not occur on or before the date that is120 days following the closing date of the Concurrent Financing, thegross proceeds will be returned to the purchasers pro rata without anydeduction or interest, and the Subscription Receipts will beautomatically cancelled.
Upon completion of the Qualifying Transaction, eachHypersonix Share underlying the Units will automatically be exchangedfor one common share of the Resulting Issuer (a “ Resulting Issuer Share ”) and each Warrant will become exercisable to acquire oneResulting Issuer Share at an exercise price of C$2.25 for a period of 24months from the date of the satisfaction of the Release Conditions.The Resulting Issuer will be entitled to accelerate the expiry date ofthe Warrants upon notice to the Warrant holders should the closingprice of the Resulting Issuer Shares on the TSXV be greater thanC$4.00 for twenty consecutive trading days.
In connection with the Concurrent Financing, the Agentswill be entitled to a cash commission equal to 8.0% of the aggregategross proceeds raised in the Concurrent Financing, which shall bereduced to 2.5% in respect of sales of Subscription Receipts of up toC$2,000,000 to purchasers on a president’s list, as well ascompensation options (the “ Compensation Options ”) exercisable for thatnumber of Units equal to 8.0% of the number of Subscription Receiptsissued pursuant to the Concurrent Financing, which shall be reduced to 2.5% in respect of the number ofSubscription Receipts of up to C$2,000,000 issued to purchasers on apresident’s list, at a price of C$1.20 per Unit for a period of 24months from the date the Release Conditions are satisfied. Inconnection with the closing of the Qualifying Transaction, eachCompensation Option will become exercisable to acquire one ResultingIssuer Share and one-half of one Warrant, with each whole Warrantexercisable to acquire one Resulting Issuer Share at an exercise priceof C$2.25 for a period of 24 months from the date of the satisfactionof the Release Conditions.
The net proceeds of the Concurrent Financing, aftergiving effect to the Qualifying Transaction, are expected to be usedby the Resulting Issuer to fund the matched funding obligationsrequired under the MMI and CRC-P grant conditions, includingengineering and project development expenses, investor communicationsand financing costs, and for general working capital purposes.
Updates to the Proposed Directors andOfficers of the Resulting Issuer
Itis presently contemplated that that the board of directors of theResulting Issuer will be comprised of David Waterhouse, Michael Smart,Gary Lewis, Robert Drolet, Trish White and John Putters and that thesenior management team will be comprised of David Waterhouse asPresident and Chief Executive Officer, Michael Smart as ChiefTechnology Officer and Head of Research and Development and WilliamHarper as Chief Financial Officer. The biographies of Trish White,John Putters and William Harper are below. The biographies of thebalance of the individuals contemplated to become directors orofficers of the Resulting Issuer are set out in the press release ofNew Media dated February 4, 2022, available on the Company’s SEDARprofile at www.sedar.com.
Trish White, Director
Ms. White has over 30 years’ experience as a seniorexecutive, company director and former politician, including previousroles at the Defence Science and Technology Organisation (now theDefence Science and Technology Group) and WorleyParsons Limited. Shewas also President and Board Chairman of Engineers Australia.
John Putters, Director
Mr. Putters is the Chief Executive Officer and adirector of Visionstate Corp. (TSXV: VIS). Mr. Putters is a seasonedentrepreneur and is one of the founders of the Visionstate Corp. He isa graduate of the University of Alberta and has spent over 25 years inthe technology space where he has disrupted the traditional wayoperators manage their facilities, in several industries. Mr. Puttershas been an integral part of the growth andsustainability of Visionstate Corp., successfully navigating itthrough its lean start-up years by establishing strategic partnershipsand ensuring the financial stability of the company.
William Harper, Chief FinancialOfficer
Mr.Harper is a Chartered Professional Accountant with William Harper CPA.Prior thereto, Mr. Harper was an accounting manager at EnkelBackoffice Solutions Inc. and audit manager at Hay & WatsonChartered Professional Accountants. He has acted as Chief FinancialOfficer for a number of publicly traded listed companies and hascorporate finance and listed-company experience in an array ofsectors. Currently, Mr. Harper also serves as Chief Financial Officerof Irvnet Inc. (TSXV: IVI) and Yorkton Equity Group Inc. (TSXV:YEG).
Disclaimer andAdditional Information
The CRC-P grant contract between Hypersonix and theAustralian federal government is signed and the necessary additionalagreements between Hypersonix and its partners are in process. TheMMI grant contract is expected to be made available once the resultsof the ongoing federal elections are known. The “CaretakerConventions” in force in Australia prevent the existing Governmentfrom entering into new commitments until the federal electionsexpected to be held on the 21 st of May 2022 has concluded. It istherefore possible that grant awards will be delayed or certain oftheir conditions modified, and the grant agreement reserve discretionto the Government to withdraw funding under certain conditions. There is therefore no assurance that funding will continue to beavailable as awarded. Hypersonix believes that as long as itcomplies with the milestones set out in the grant conditions there arelimited risks that the grants will be reduced or conditions altered. See also the Cautionary Statements below.
Additional information concerning the Qualifying Transaction, theConcurrent Financing, New Media, Hypersonix and the Resulting Issueris available in the news releases of New Media dated February 4, 2022 and March 7,2022 and will be provided insubsequent news releases and in the filing statement to be filed byNew Media in connection with the Qualifying Transaction and which willbe available under New Media’s SEDAR profile atwww.sedar.com.
Disclosure About RecentGrants Awarded to Hypersonix
10 May 2022 - Hypersonix Launch Systems awarded A$8M MMIDefence Grant for the manufacture and launch of 3D printed DART AEtechnology demonstrator
On the 21 st of April 2022, the Australian Federal Government announcedthe successful applicants of the Modern Manufacturing Initiative (MMI)Defence Translation stream.
Hypersonix Launch Systems was granted A$8M for the DARTAE Multi-mission Hypersonic Drone Technology Demonstrator usingAdditive Engineering.
Since the first official announcement by Hypersonix todevelop DART AE in November 2021, the global interest in theAustralian company has grown.
Management believes key factors for Hypersonixtechnology being demonstrated by DART AE are scalability ofmanufacture, reliability, cost effectiveness and high cadence ofmanufacture, enabling multiple low-cost launches in a short timeframe.
With this latest grant award, Hypersonix Launch Systemssecured funding for the 3D printed version of DART, DART AE, which isscheduled for launch in 2023.
In addition, the recently announced A$2.95 millionCooperative Research Centres Projects grant from the Australianfederal government (awarded to Hypersonix and its partners in lateMarch 2022) for the re- usable high temperaturecomposite version of DART, DART CMP, builds on the successfulcompletion of the Department of Industry, Science, Energy &Resource’s Accelerating Commercialisation Grant for the build of aprototype scramjet engine and fuel system, completed in March 2022.
According to David Waterhouse, Managing Director andCo-Founder of Hypersonix: “With Hypersonix Launch Systems beingawarded this major grant, the Hypersonix team is ‘over the moon’and the MMI grant will provide a catalyst to our growth in Australiaand ability to grow Australia’s export market in this key area ofAerospace technology.”
Michael Smart, CTO, Head of R&D and Co-Founderadds: “The team is extremely proud that our MMI grant applicationfor the build and launch of DART AE has been successful. It gives usthe necessary funding to quickly progress our core scramjet technologythat has been fully developed in Australia.”
May 4, 2022- Successful green Hydrogen tests atBulwer Island complete Hypersonix ACA Grant activities
Hypersonix Launch systems has completed all theactivities covered by the Department of Industry, Science, Energy& Resources Accelerating Commercialisation (ACA) grant on time andon budget on 31 st March.The grant project called for the manufacture of a scramjet engineprototype SPARTAN and its hydrogen fuel system.
The company conducted high-pressure hydrogen gas flowtests through its additive manufactured (3D-printed) scramjetcombustor at Bulwer Island (close to Brisbane airport [on test rigsdesigned by its engineering team]. The HIL (hardware in the loop)bench top tests were the final series of steps required by theAccelerating Commercialisation grant awarded to Hypersonix in 2020.The successful tests have proven that the scramjet engine fuel systemis working as designed and will inform future builds of the fuelsystem.
Hypersonix Launch Systems 3D printed the SPARTANscramjet engine in Australia with Amiga Engineering to Hypersonix’precise specifications, and it was delivered under its Christmas treeto undergo a series of measurements and tests using Nitrogen initiallyand then hydrogen, through the first quarter.
“The SPARTAN scramjet powers all of Hypersonix’sunmanned hypersonic UAVs currently under development. There is also acomposite version of the SPARTAN scramjet engine currently indevelopment”, according to David Waterhouse, Managing Director ofHypersonix.
The 3D printed DART AE technology demonstrator,launching in 2023, will feature a single SPARTAN scramjetengine.
Both the Delta Velos Demonstrator as well as the DeltaVelos Orbiter will use four SPARTAN scramjet engines. The Delta VelosOrbiter is the large-scale hypersonic vehicle designed to place smallsatellites into Low Earth Orbit.
March 29, 2022 – Australian Federal Governmentfunds $2.95M for world’s first reusable hypersonic UAVproject
Hypersonix, together with the University of SouthernQueensland, LSM Advanced Composites (“ LSM ”) and New SouthWales-based Romar Engineering (“ Romar ”) have beenawarded a A$2.95 million Cooperative Research Centres Projects(“ CRC-P ”) grant from the Australian federal government.
The project, titled “DART CMP Airframe – a reusablehypersonic platform”, is a UAV (unmanned aerial vehicle) that cantravel at hypersonic speeds up to Mach 12 (twelve times the speed ofsound). It is powered by the SPARTAN hydrogen fuelled scramjetengine.
Scramjets take oxygen from the atmosphere, a fact thatreduces weight by 60 per cent compared to rockets. The development ofnew high temperature composite materials in this project will enableDART CMP to be reusable. With zero CO2 emissions thanks to the greenhydrogen fuel, management believes that Hypersonix is leading a newera of “green” access to space.
The project will deliver a new sovereign manufacturingcapability for high temperature ceramic matrix composites inAustralia.
The deliverables include a complete UAV airframeincluding composite aeroshell and aerodynamic control surfaces, flightavionics, and hydrogen fuel system.
Hypersonix Managing Director David Waterhouse said DARTCMP is the composite version of the DART AE due for launch in2023.
“AE stands for Additive Engineering and is the fully3D printed version out of high temperature alloys that are alreadyavailable in Australia,” Mr. Waterhouse said.
“The type of high temperature composites we requirefor DART CMP are currently not available here, therefore there is anurgent need to develop these materials in Australia.
“We are thankful that the government acknowledgedthis gap and responded with accepting our application. We can’t waitto have these materials ready in mid 2025.”
Hypersonix Chief Technology Officer Michael Smartadded: “And we are proud to support three PhD students with thisproject as well, we need more experts in this developingindustry.”
The University of Southern Queensland’s Institute forAdvanced Engineering and Space Sciences Executive Director ProfessorPeter Schubel said the CRC-P success was an exciting step for itsongoing collaboration with Hypersonix.
“The University of Southern Queensland is applyingits research expertise in the field of hypersonics and futurematerials to help realise an innovative mission,” Professor Schubelsaid.
“Our role in the project will be to develop and testthe prototype ultra-high temperature composite material needed.
“Our expertise in liquid moulding technologies,automated fibre placement, pultrusion and filament windingcapabilities with exotic materials allows us to develop revolutionarystructures.
“As an industry-focused research and technologyorganisation, we are committed to delivering real-world, large-scalesolutions for our clients, utilising our extensive laboratories andmanufacturing equipment.”
Additive Manufacturing/3D Printing will be used wherepossible and will be covered by Romar with Steve Milanoski(ex-SpaceX), leading the steadily growing additive manufacturingteam.
The DART CMP UAV will undergo hardware in the loopbench testing as part of flight readiness.
The CRC-P grant was not the first Australian federalgovernment grant awarded to Hypersonix. With the successful completionof an “Accelerating Commercialisation program” by 31st March ontime and on budget, the Hypersonix team is excited to prepare forproject DART CMP starting in July 2022.
Romar is also no stranger to government grants havingbeen awarded a Modern Manufacturing Initiative (“ MMI ”) Space grantin 2021 for A$5.85 million for the development of its fluid and motioncontrol business.
Romar has developed significant capability in materialscharacterisation for metal 3D printing and has establishedmanufacturing expertise using L-DED and L-PBF technologies. The Romaradvanced manufacturing team offers total engineering solutions fromearly-stage design and prototyping through to serial manufacture ofspace rated components.
“We are very excited to be working with Hypersonix,USQ and LSM on the development of the DART CMP. The project representsa significant leap forward in technology for the fast-growingAustralian space industry,” said Romar Chief Executive Officer, AlanLipman.
LSM Managing Director Liam Mahoney added: “LSMAdvanced Composites is proud to be a participant in this uniqueproject for a hypersonic UAV, which will be revolutionary in thedevelopment of high temperature ceramic compositecomponents.”
About New Media Capital 2.0 Inc.
The only business of New Media is the identification and evaluation ofassets or businesses with a view to completing a “QualifyingTransaction” in accordance with the policies of the TSXV. Forfurther information, contact: New Media Capital 2.0 Inc., John A.Putters, CEO and Director. Tel.: 587-985-2601.
About Hypersonix Launch SystemsLtd.
Hypersonix is an Australian engineering, design andbuild company specializing in scramjet engines and hypersonictechnology. Hypersonix is developing several hypersonic vehicles thatfly at hypersonic speeds between Mach 5 and Mach 12 with zero CO2emissions, only water vapor, and have applications in both satellitelaunch and high-speed aviation. For further information, contact NinaPatz by email at Nina.Patz@hypersonix.com.au and byphone at +61-0400-679-499.
DisclosureRegarding Forward-Looking Statements : This pressrelease contains certain statements with respect to “forward-lookinginformation” within the meaning of applicable securities legislationrelating to the proposal to complete the Qualifying Transaction andassociated transactions, including statements regarding the terms andconditions of the Qualifying Transaction, the Concurrent Financing,the use of proceeds of the Concurrent Financing, the proposeddirectors and officers of the Resulting Issuer and the business of theResulting Issuer. We use words such as “might”, “will”, “should”,“anticipate”, “plan”, “expect”, “believe”,“estimate”, “forecast” and similar terminology to identify forward - looking statements and forward-looking information. Such statements and information are based on assumptions, estimates, opinions and analysis made by management in light of itsexperience, current conditions and its expectations of future developments as well as other factors which it believes to be reasonable andrelevant. Forward-looking statements and information involve known andunknown risks, uncertainties and other factors that may cause ouractual results to differ materially from those expressed or implied inthe forward-looking statements and information and accordingly,readers should not place undue reliance on such statements andinformation. Although the Company and Hypersonix believe, in light ofthe experience of their officers and directors, current conditions andexpected future developments and other factors that have beenconsidered appropriate, that the expectations reflected in thisforward-looking information are reasonable, undue reliance should not be placed on them because the Company and Hypersonix can give noassurance that they will prove to be correct. In evaluatingforward-looking statements and information, readers should carefully consider the various factors which could cause actual results or events to differ materially from those expressed or implied in the forward looking statements and forward-looking information depending on, among other things, the risks that the parties will not proceed with the Qualifying Transaction, theConcurrent Financing and/or other associated transactions, that theultimate terms of the Qualifying Transaction, the Concurrent Financing and/or other associated transactions will differ from those currently contemplated, andthat the Qualifying Transaction, the Concurrent Financing and/or otherassociated transactions will not be successfullycompleted for any reason (including the failure to obtain the requiredapprovals or clearances from regulatory authorities). The statementsin this press release are made as of the date of this release. Exceptas required by law, each of the Company and Hypersonix disclaims anyobligation to update or revise any forward-looking statements hereinfor any reason or to comment on analyses, expectations or statementsmade by third parties in respect of the Company, Hypersonix, theirrespective securities, or their respective financial or operatingresults (as applicable).
Completion of theQualifying Transaction is subject to a number of conditions, includingbut not limited to, TSXV acceptance and if applicable, disinterested shareholderapproval. Where applicable, the Qualifying Transaction cannot closeuntil the required shareholder approval is obtained. There can be noassurance that the Qualifying Transaction will be completed asproposed or at all.
Investors arecautioned that, except as disclosed in the management informationcircular or filing statement to be prepared in connection with theQualifying Transaction, any information released or received withrespect to the Qualifying Transaction may not be accurate or complete and should not be relied upon. Trading in the securities of a capital pool company should beconsidered highly speculative.
The TSXV has in noway passed upon the merits of the Qualifying Transaction and hasneither approved nor disapproved the contents of this pressrelease.
Neither the TSXVnor its Regulation Services Provider (as that term is defined in thepolicies of the TSXV) accepts responsibility for the adequacy oraccuracy of this release.
This press release is intended for distribution in Canada only and isnot intended for distribution to United States newswire services ordissemination in the United States. The securities being offered havenot been, nor will they be, registered under the United StatesSecurities Act of 1933, as amended, or any state securities laws andmay not be offered or sold within the United States or to, or for theaccount or benefit of, U.S. persons absent U.S. registration or anapplicable exemption from the U.S. registration requirements. Thisrelease does not constitute an offer for sale of securities in theUnited States.
All informationcontained in this press release relating to Hypersonix was provided byHypersonix to New Media for inclusion herein. New Media has not independently verified such information and shall bear no liabilityfor any misrepresentation contained therein.
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