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Toronto, Ontario - TheNewswire - August 31, 2020 - Cuspis Capital Ltd. (TSXV:CUSP) ("Cuspis" or the "Corporation"), a capital pool company as defined under TSX Venture Exchange ("TSXV" or the "Exchange") Policy 2.4 - Capital Pool Companies ("Policy 2.4"), is pleased to provide an update to its press release on August 19, 2020, regarding Graphene Manufacturing Group Pty Ltd. ("GMG"), a private company incorporated under the laws of Australia, the intended target of Cuspis's Qualifying Transaction, as such term is defined in the policies of the Exchange, and GMG's proposed non-brokered private placement (the "Financing") of ordinary shares of GMG ("Shares") at a price of AUS $12.50 per Share, for gross proceeds of a minimum of AUS $1,226,025 (the "Minimum Financing") and a maximum of AUS $1,726,025 (the "Maximum Financing"). The price per share of the Shares results in an effective price equal to CAD $0.53 per Post Consolidation Cuspis Share (as defined below) which is based on the exchange ratio at the time of the LOI (as defined below), with such exchange ratio to be finally determined at the time of the entering into of a definitive Qualifying Transaction agreement between Cuspis and GMG based on the applicable foreign exchange rate at such time.
In the event of the Minimum Financing, GMG's use of proceeds will be approximately AUS$ 50,000 on capital expenditures, AUS$ 130,000 on research and development and the remaining AUS$ 1,046,025 for general working capital purposes. In the event of the Maximum Financing, the additional AUS$ 500,000 will be used for general working capital purposes.
Successful completion of the Financing will result in a minimum total of 98,082 Shares and up to a maximum total of 138,082 Shares to be issued by GMG. In accordance with the terms of the letter of intent entered into on August 17, 2020 between Cuspis and GMG (the "LOI"), on completion of the acquisition of GMG by Cuspis, including the completion of a consolidation of Cuspis's common shares ("Cuspis Shares") on the basis of one (1) post-consolidation Cuspis Share ("Post Consolidation Cuspis Share") for every two and one-half (2.5) pre-consolidation Cuspis Shares, the Financing shall have resulted in the issuance of an additional minimum 2,196,233 Post-Consolidation Cuspis Shares up to a maximum of 3,091,905 Post-Consolidation Cuspis Shares.
Certain fees may be payable by GMG to Caerus Management Limited ("Caerus"), an arm's length third party, pursuant to an Investment Advisory Agreement between GMG and Caerus in connection with the Financing and the Transaction. Such fees may include cash, being 10% of funds procured by Caerus during the Financing and an additional cash payment based on the Cuspis cash balance (net of liabilities) upon closing of the Transaction. Fees may also become payable in the form of GMG shares depending on the amount of funds procured by Caerus during the Financing and the Cuspis cash balance (net of liabilities) upon closing of the Transaction, which will not exceed 35,500 GMG shares in total.
Prior to commencing the Financing, GMG raised proceeds of approximately AUS $1.3 million pursuant to a financing of Shares at a price of AUS $12.50 per Share that began in December 2019 (the "December Financing"). Based on the proceeds raised in the December Financing and assuming completion of the Financing, GMG anticipates raising approximately AUS $2.5 million to AUS $3 million since December 2019.
Further Information
Completion of the Transaction is subject to a number of conditions, including but not limited to, TSXV acceptance and if applicable pursuant to TSXV requirements, majority of the minority shareholder approval. Where applicable, the Transaction cannot close until the required shareholder approval is obtained. There can be no assurance that the transaction will be completed as proposed or at all.
Investors are cautioned that, except as disclosed in the Disclosure Document to be prepared in connection with the Transaction, any information released or received with respect to the Transaction may not be accurate or complete and should not be relied upon. Trading in the securities of a capital pool company should be considered highly speculative.
The TSXV has in no way passed upon the merits of the Transaction and has neither approved nor disapproved the contents of this press release.
For further information:
William Ollerhead
Cuspis Capital Ltd.
Will@CuspisCapital.com
Tel. (416) 214-4810
Forward-Looking Information
This press release contains "forward-looking information" and "forward-looking statements" (collectively, "forward-looking statements") within the meaning of applicable Canadian securities legislation. 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 press release. 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 statements. In this press release, forward-looking statements relate, among other things, to the Financing; and future press releases and disclosure. Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable, are subject to known and unknown risks, uncertainties, and other factors which may cause the actual results and future events to differ materially from those expressed or implied by such forward-looking statements. Such factors include, but are not limited to: general business, economic, competitive, political and social uncertainties; and the delay or failure to receive shareholder, director or regulatory approvals. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on the forward-looking statements and information contained in this press release. Except as required by law, Cuspis assumes no obligation to update the forward-looking statements of beliefs, opinions, projections, or other factors, should they change, except as required by law.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
This press release does not constitute an offer to sell or a solicitation of an offer to buy any of the 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 "U.S. Securities Act") or any state securities laws and may not be offered or sold within the United States unless registered under the U.S. Securities Act and applicable state securities laws, unless an exemption from such registration is available.
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