ORIGINAL: DGTL Holdings Announces Closing of First Tranche of Financing
2021-12-07 04:01 ET - News Release
Toronto, Ontario--(Newsfile Corp. - December 7, 2021) - DGTL Holdings Inc. (TSXV: DGTL) (OTCQB: DGTHF) (FSE: A2QB0L) ("DGTL" or the "Company"), today announced the closing of a first tranche (the "First Tranche") of its previously announced private placement offering of subscription receipts ("Subscription Receipts"). Under the First Tranche, the Company issued 1,030 Subscription Receipts at an offering price of $1,000 per Subscription Receipts, for aggregate gross proceeds of $1,030,000. The completion of the First Tranche satisfied a key condition to closing in the arrangement agreement between the Company and Engagement Labs Inc. ("EL") dated August 11, 2021, as amended.
The gross proceeds of the First Tranche (the "Subscription Receipt Proceeds") are held by Garfinkle Biderman LLP ("Garfinkle"), in its capacity as subscription receipt agent, pursuant to the terms of a subscription receipt agreement entered into between DGTL and Garfinkle. Upon the satisfaction and/or waiver of certain escrow release conditions (the "Escrow Release Conditions") each Subscription Receipt will automatically be converted into a $1,000 principal amount Convertible Debenture (as defined below) and the Subscription Receipt Proceeds will be released. The Escrow Release Conditions shall include, without limitation, the completion of the DGTL's previously announced acquisition of EL pursuant to a plan of arrangement and the delivery by DGTL of a notice to Garfinkle confirming such condition has been met.
The Convertible Debentures will bear interest at an annual rate of 7.00% payable in arrears in equal installments semi-annually. The Convertible Debentures will mature two years following the satisfaction of the Escrow Release Conditions (the "Maturity Date") as will be further set out in debenture certificates to be issued upon conversion of the Subscription Receipts. The principal amount of Convertible Debenture will be convertible at the holder's option into common shares of DGTL (the "Conversion Shares") at any time prior to the Maturity Date at a conversion price of $0.30 per Conversion Share. Subject to the approval of the TSX Venture Exchange (the "TSXV"), in lieu of paying any interest accrued and payable in respect of the Convertible Debentures, DGTL may elect to settle such interest in common shares in the capital of DGTL.
In connection with the First Tranche, the Company is required to pay finder's fees to eligible finders comprised of an aggregate of $49,000 in cash, and such cash finder's fees form part of the Subscription Receipt Proceeds and will be released to the finders upon satisfaction of the Escrow Release Conditions, and DGTL will issue 81,659 finder's warrants ("Finder's Warrants") upon satisfaction of the Escrow Release Conditions. Each Finder's Warrant entitles the holder thereof to purchase one common share of DGTL at a price of $0.40 for a period of 36 months following the date on which the Escrow Release Conditions are satisfied.
The Subscription Receipts and any underlying securities issued pursuant to the First Tranche are subject to a statutory hold period of four months and one day from the date hereof.
In connection with the First Tranche, a "related party," for the purposes of Multilateral Instrument 61-101 - Protection of Minority Security Holders in Special Transactions ("MI 61-101"), subscribed for an aggregate of 200 Subscription Receipts. The issuance and sale of these securities to such related party constituted a "related party transaction" for the purposes of MI 61-101. The Company is relying on exemptions from the formal valuation and minority shareholder approval requirements available under MI 61-101. The Offering is exempt from the formal valuation and minority shareholder approval requirements of MI 61-101 (pursuant to subsection 5.5(b) and 5.7(1)(b)) as the Company is not listed on the markets specified in MI 61-101 and neither the fair market value of the Subscription Receipts distributed to, nor the consideration received from interested parties exceeded $2,500,000.
ABOUT DGTL
DGTL Holdings Inc. acquires and accelerates transformative digital media, marketing and advertising software technologies, powered by Artificial Intelligence (AI). DGTL (i.e. Digital Growth Technologies and Licensing) specializes in accelerating commercialized enterprise level SaaS (software-as-aservice) companies in the sectors of content, analytics and distribution, via a blend of unique capitalization structures. DGTL Holdings Inc. is traded on the Toronto Venture Exchange as "DGTL," the OTCQB exchange as "DGTHF," and the Frankfurt Stock Exchange as "A2QB0L." For more information, visit: www.dgtlinc.com.
HASHOFF LLC
As a wholly owned subsidiary of DGTL Holdings Inc., Hashoff is an enterprise level self-service CaaS (content-as-a-service) built on proprietary Artificial Intelligence and Machine Learning (AI-ML) technology. Hashoff's AI-ML platform functions as a full-service content management system, designed to empower global brands by identifying, optimizing, engaging, managing, and tracking top-ranked digital content publishers for localized brand marketing campaigns. Hashoff is fully commercialized and currently serves numerous global brands by providing direct access to the global gig-economy of over 150 million freelance content creators.
Hashoff's customer portfolio includes global brands in a range of key growth categories, including Anheuser Busch-InBev, Nestle, Post Holdings, Danone and Keurig-Dr. Pepper, Dunkin Brands, The Container Store, TJ Maxx, Ulta Beauty and Pizza Hut Live Nation, The CW, Scribd, Syneos Health and Novartis, etc.[1] Learn more by visiting: https://dgtlinc.com/technology.
CONTACTS - DGTL
John Belfontaine, Director
Email: IR@dgtlinc.com
Phone: +1 (877) 879-3485