TORONTO, ON/ACCESSWIRE/June 22, 2022/ PowerBand Solutions Inc. (TSXV: PBX, Financial) (OTCQB: PWWBF) (“power band” “PABX“or the”Company“), a complete e-commerce solution transforming the online experience for selling, trading, leasing and financing vehicles, announces the closing of a first tranche (the “First installment“) of its previously announced private placement financing (the “Funding“), announced on May 10, 2022. PowerBand today issued 62,037,560 units (the “Units“) at a subscription price of CA$0.30 per Unit for gross proceeds of CA$18,611,268 (approximately US$14,330,676). Each Unit consists of one common share of the Company and one warrant, each warrant exercisable for one additional common share at an exercise price of CAD$0.40 for a period of 60 months.
PowerBand is pleased to announce that it has attracted a third strategic shareholder, Pierre Lassonde, to the previously disclosed strategic investor group of J. Bryan Hunt Jr. and Joe Poulin, further enhancing shareholder value. Mr. Lassonde has extensive experience investing in early-stage companies and will bring significant value to the Company throughout its growth plan.
The Company intends that the aggregate size of the financing will be gross proceeds of C$23,806,308 (approximately US$18,330,852). The Company expects a second closing tranche for the balance of the subscription proceeds to be completed in approximately 10 calendar days, subject to regulatory approval.
Proceeds from the financing will be used for general working capital purposes, product development, marketing and advertising and other strategic growth initiatives, the repayment of certain previously disclosed debts owed to Kelly Jennings as set forth below. below, and transaction fees. The securities issued under the Financing will be subject to a hold period of four months from their date of issue.
Loan and shares for debt
On May 4, 2022, D2D Auto Auction LLC, the joint venture 50% owned by the Company and 50% owned by J Bryan Hunt Jr. advanced US$3,519,711 to the Company in the form of a bridge loan (the “Ready“). The loan was secured by the assets of the Company, bears interest at the prime rate and is repayable at the closing of an equity transaction for the debt (the “Debt settlement“), to occur concurrently with the closing of the first tranche. The loan proceeds were used to make the final installment of the purchase price for the Drivrz Financial acquisition and for general working capital purposes. Mr. Hunt financed the loan and is due to repay at the closing of the financing The loan is settled today through debt settlement The obligations under the loan amounting to C$4,534,092 , are settled by issuing 15,113,640 units at a deemed price of $0.30 per unit, these Units having the same terms and conditions as the Units issued in the First Tranche.
Management and Board Changes
The Company also announces the appointment of Darrin Swenson as President and Chief Executive Officer, thereby removing “interim” from his title, and the appointment of J. Bryan Hunt Jr. as Chairman of the Board of Directors. Darrin Swenson, CEO and Director of PowerBand Solutions, said, “With this recapitalization, PowerBand can focus on completing its expense restructuring plan by the end of June 2022. We are working diligently on a new strategic plan which we plan to unveil to stakeholders by the end of June 2022. end of Q3 2022 and will provide further updates as appropriate.”
Powerband also announces that Jon Lamb, who served as President and CEO of Drivrz Financial LLC, has left the company for personal reasons. The Company would like to thank Mr. Lamb for his dedication and stewardship and wishes him well in his future endeavours.
Kelly Jennings, the company’s former chairman, president and chief executive, resigned and signed a separation agreement providing for the company to repay Mr. Jennings C$2 million of his loans, the balance of 2 C$.6 million being repayable within 18 months, subject to Mr. Jennings’ compliance with certain non-competition and confidentiality covenants of the separation agreement. These loans are non-interest bearing and have been previously disclosed by the Company.
Potential new control person
The subscription of Units by Mr. Hunt in the First Tranche and the issuance of the Units to Mr. Hunt pursuant to the Debt Settlement, assuming the exercise of all Warrants, will make him a new “person of control” of the Company, as that term is defined by the policies of the TSX Venture Exchange. Following the closing of the First Tranche and the Debt Settlement, Mr. Hunt controls 52,646,800 shares of the Company, representing 18.88% on a non-diluted basis and 29.49% on a partially diluted basis. The Company intends to seek shareholder approval for Mr. Hunt to become a controlling person of the Company. In the meantime, Mr. Hunt has covenanted with the Exchange not to exercise or convert any convertible securities that would give him beneficial ownership or control, direct or indirect, of more than 19.99% or more of the Common Shares. issued and in circulation. the company.
About PowerBand Solutions, Inc.
PowerBand Solutions Inc., listed on the TSX Venture Exchange and OTCQB markets, is a financial technology provider disrupting the automotive industry. PowerBand’s integrated cloud-based transaction platform facilitates transactions between consumers, resellers, backers and manufacturers (OEMs). It allows them to buy, sell, trade, finance and lease new and used vehicles, electric and non-electric, on any internet-connected phone, tablet or PC. PowerBand’s trading platform – being a registered trademark under DRIVERZ™ – is available in the North American and global markets.
For more information, please contact:
Chief executive officer
E : [email protected]
Early warning report
Hunt Investment Trust No. 2 (the “Acquirer“), a family trust controlled by J. Bryan Hunt Jr., acquired a total of 41,930,000 units of the Company pursuant to the financing and debt settlement. Mr. Hunt previously owned 10,716,800 common shares of the Company, representing 5.31% of the issued and outstanding common shares of the Company After the closing of the first tranche and the settlement of the debt, the two parties jointly control 52,646,800 shares of the Company representing 18.88% on a on an undiluted basis and 29.49% on a partially diluted basis (this partially diluted calculation includes the exercise of all warrants held by the Purchaser).
The Purchaser acquired the Units pursuant to (i) a subscription agreement dated the same day and for total proceeds of C$8,044,908 and (ii) debt settlement (settlement obligations of C$4,534,092 CAD).
The Units were acquired by the Purchaser for investment purposes. The acquirer and Mr. Hunt each have a long-term view of the company and may acquire additional securities of the company either on the open market or through private acquisitions, or sell securities on the open market or by through private divestments in the future depending on market conditions, reformulation of plans and/or other relevant factors.
A copy of the Investor Alert will be filed on the issuer’s SEDAR profile at www.sedar.com.
For more information, please contact:
Johnnie B. Hunt Jr.
E : [email protected]
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 press release.
This press release contains forward-looking statements relating to the Company and other statements that are not historical facts. Forward-looking statements are often identified by words such as “will”, “may”, “should”, “anticipate”, “expect” and similar expressions. All statements, other than statements of historical fact, included in this release, including, without limitation, statements regarding the Company’s future plans and objectives, the closing of the second tranche of financing, the use of proceeds of the financing, matters relating to shareholder approval and the Company’s strategic plan, 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.
Readers are cautioned that the assumptions used in preparing any forward-looking information may prove to be incorrect. Events or circumstances may cause actual results to differ materially from those anticipated due to numerous known and unknown risks, uncertainties and other factors, many of which are beyond the Company’s control. Accordingly, we cannot guarantee that any forward-looking statements will materialize, and the reader is cautioned not to place undue reliance on any forward-looking information. Such information, although considered reasonable by management when prepared, may prove to be incorrect and actual results may differ materially from those anticipated.
The forward-looking statements contained in this press release are expressly qualified by this cautionary statement. The forward-looking statements contained in this press release are made as of the date of this press release, and the Company undertakes no obligation to publicly update or revise any of the forward-looking statements included, whether as a result new information, future events or otherwise, except as expressly required by Canadian securities law.
This press release does not constitute an offer to sell or a solicitation of an offer to buy any securities in the United States. The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the “United States Securities Act”) or any state securities law and may not be offered or sold in the United States unless registered under United States law. Securities Act and applicable state securities laws, unless an exemption from such registration is available.
THE SOURCE: PowerBand Solutions Inc.
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