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VANCOUVER, BC, Dec. 7, 2023 /CNW/ - ECC Ventures 6 Corp. (the "Company" or "ECC6") (TSXV: ECCS.P) is pleased to announce that further to its news release dated July 20, 2023, it has entered into a definitive amalgamation agreement (the "Amalgamation Agreement") dated effective November 30, 2023, pursuant to which it will acquire (the "Acquisition"), through its newly formed subsidiary, 1428703 B.C. Ltd. ("Acquireco"), all of the issued and outstanding share capital of LCM Energy Solution Inc. ("LCMBC"). The Acquisition will constitute a reverse take-over and the Company's qualifying transaction under the policies of the TSX Venture Exchange (the "Exchange"). Upon closing of the Acquisition, ECC6 will change its name to "LCM Energy Solution Inc." and is expected to become a technology issuer.
The Acquisition
The Acquisition will be completed by way of an amalgamation pursuant to which, inter alia, (i) ECC6 will complete a share consolidation on the basis of 1.1834409 pre-consolidation common shares for one (1) post-consolidation common share (the "Consolidation"), (ii) all 565,000 ECC6 stock options currently issued and outstanding will be cancelled, and (iii) the shareholders of LCMBC will be issued an aggregate of 73,400,000 Resulting Issuer Shares (as defined below) at a deemed price of $1.00 per Resulting Issuer Share in exchange for their common shares of LCMBC. It is anticipated that certain of the Resulting Issuer Shares issued as consideration for the Acquisition will be subject to escrow and resale restrictions pursuant to the policies of the Exchange.
Upon closing of the Acquisition, current securityholders of ECC6 are expected to own: (i) 4,774,214 Resulting Issuer Shares, 1,689,987 of such Resulting Issuer Shares which are expected to be subject to escrow provisions pursuant to the policies of the Exchange; and (ii) 168,999 agent's options, each exercisable at $0.12 per Resulting Issuer Share until December 17, 2026.
The Company will also issue 2,205,000 Resulting Issuer Shares to an arm's length party, Golden Gate Capital Inc., as a finder's fee in connection with the Acquisition, at a deemed price of $1.00 per Resulting Issuer Share. Payment of the finder's fee remains subject to Exchange acceptance.
About LCM Energy Solution
LCMBC is a private holding company incorporated on October 13, 2022, pursuant to the laws of British Columbia. LCMBC's principal asset is its wholly owned subsidiary, LCM Energy Solution (Korea) Inc., a private company incorporated on March 9, 2021, pursuant to the laws of South Korea ("LCM Korea"). Pursuant to a share exchange agreement, on March 15, 2023 LCMBC and LCM Korea completed a business combination. As of December 31, 2022 (audited), LCM Korea had assets of $9,066,677, current and long-term liabilities of $7,744,556, and a working capital deficit of $1,092,179, and for the year ended December 31, 2022 (audited) had $nil sales, and incurred a net and comprehensive loss of $4,193,465, including research and development costs of $754,876. As of December 31, 2022 (audited), LCMBC had assets of $3,000, liabilities of $15,000, a working capital deficit of $10,000, and for the period from incorporation on October 13, 2022 to December 31, 2022 (audited) had $nil sales, and incurred a net and comprehensive loss of $15,000. As of September 30, 2023 (unaudited), on a consolidated basis, LCMBC had assets of $9,237,519, current and long-term liabilities of $9,320,685, and a working capital deficit of $6,163,596, and for the nine months ended September 30, 2023 (unaudited) had sales of $45,928, and incurred a net and comprehensive loss of $2,305,047, including research and development costs of $642,952. LCM Korea's principal activities focus on two green energy technologies:
- LCM Korea has developed customized lithium battery solutions for various industries such as E-mobility, Energy Storage Systems, and special market sectors, such as the military & defense market. Together with its hardware technology for cell & battery pack design, manufacturing and assembly, LCM Korea is also developing a software platform for integrated management for optimal operation of secondary battery equipped vehicles, vessels, drones, machines and other devices; and
- LCM Korea, based on its own patented technologies, has developed and is manufacturing and marketing bidirectional vertical small wind power generation systems. These hybrid power generation systems combine small wind turbines with a solar power module and LCM Korea's proprietary slip-ring, a core component for wind power systems that replaces traditional mercury-type slip rings that cause environmental pollution.
For more information regarding LCMBC and LCM Korea, please visit their website at LCM Energy Solution.
Financing
As a condition to completing the Acquisition, the parties intend to complete a non-brokered private placement financing (the "QT Financing") of subscription receipts of Acquireco (the "Subscription Receipts"), to raise minimum gross proceeds of $10,000,000, through the issuance of a minimum of 10,000,000 Subscription Receipts at a price of $1.00 per Subscription Receipt.
The proceeds of the QT Financing will be held in escrow, pending the Company receiving all applicable regulatory approvals, and completing all matters and conditions relating to the Acquisition, including the Consolidation. Immediately prior to the completion of the Acquisition, on satisfaction of the escrow conditions, each Subscription Receipt will automatically be exchanged for, without payment of any further consideration and with no further action on the part of the holder thereof, one (1) common share of Acquireco (each, a "Acquireco Share"), and immediately thereafter, each Acquireco Share issuable upon conversion of the Subscription Receipts will be exchanged for one common share (each, a "Resulting Issuer Share") of the issuer resulting from the Acquisition (the "Resulting Issuer") in connection with the Acquisition. In the event that the Acquisition is not completed, each Subscription Receipt will be cancelled, and the subscription funds will be returned to the subscribers. The Company may pay a commission in connection with the QT Financing, in accordance with the policies of the Exchange. Once released from escrow, the Resulting Issuer will use the proceeds of the QT Financing for commercialization of its products, and for general working capital purposes.
All securities issued by the Resulting Issuer in connection with the QT Financing will be free trading upon completion of the Acquisition.
Resulting Issuer Board and Management
Upon completion of the Acquisition, the Resulting Issuer's board of directors and management team will be reconstituted to include the following directors and management:
Ryan Kim, proposed CEO and Director of the Resulting Issuer and current CEO and Director of LCMBC
Mr. Kim has over 10 years of experience working in the corporate development sector with a variety of public and private companies in Canada. In addition, Mr. Kim worked as a regional district manager at a South Korean public company, giving him exposure to public company processes both nationally and internationally. Mr. Kim has developed his career serving as a corporate development and securities compliance officer, as well as an independent director in the Canadian public corporation sector. Mr. Kim has exposure to a variety of industries, including construction, real estate development and renewable energy industries. Mr. Kim currently holds the position of Vice-President of Blueapple Asset Management Ltd. based in Vancouver, British Columbia.
Seul Chan Lee, proposed Chairman andDirector of the Resulting Issuer and current Chairman and Director of LCMBC and CEO and President of LCM Korea
Mr. Seul Chan Lee, an innovative and performance-driven entrepreneur with a deep passion for technology and business, is currently the Chairman and a director of LCMBC and the President and CEO of LCM Korea, and has experience in managing all aspects of business development. He possesses excellent leadership skills and has extensive experience driving revenue growth and scaling organizations from nation-wide to overseas. His entrepreneurial background and ability to commercialize nascent technologies have enabled him to drive innovation to market throughout his career.
Mr. Lee is a graduate of Woongji Accounting & Tax College, majoring in tax administration and holds a Master of Business Administration from Graduate School of Business, Hyung Hee University.
Xiao Nan (Nancy) Zhao, proposed CFO and Corporate Secretary of the Resulting Issuer
Ms. Zhao has over 9 years of experience working with public companies, having served as the CFO for several publicly traded entities, contributing her financial acumen to organizations such as First Hydrogen Corp (TSXV-FHYD), and Neo Battery Materials Ltd (TSXV-NBM). Ms. Zhao is currently a board member of First Hydrogen Corp.
Holding the designation of CPA, Ms. Zhao boasts a comprehensive educational background, including a diploma in Financial Management from British Columbia Institute of Technology, and a bachelor's degree in chemical engineering from Tianjin University of Technology, adding a unique dimension to her financial acumen. Ms. Zhao's professional journey encompasses diverse roles, including years of valuable experience as a procurement agent for Sinopec in China. This multifaceted background equips her with a unique perspective, blending financial proficiency with a comprehensive understanding of global business operations.
Doug McFaul, proposed Director of the Resulting Issuer
Mr. McFaul brings over 26 years of experience in the financial services and capital markets industries and since 2014 has served as the VP Business Development of Emprise Capital Corp., a private merchant bank. Mr. McFaul has experience with the operations of public companies, as well as an in-depth understanding of the regulatory requirements, completion of necessary financial statements, raising capital, and shareholder relations. Mr. McFaul has held numerous board and management positions providing direction and leadership toward the achievement of an organization's philosophy, mission, strategy, and its annual goals and objectives. Mr. McFaul holds a Bachelor of Business Administration specialized in Finance from the University of Alaska Fairbanks and has completed the Canadian Securities Course.
Gary Anderson, proposed Director of the Resulting Issuer
Mr. Anderson was an Investment Adviser (Canadian and US licensed) with a leading Canadian brokerage firm between 1987 - 2004 and participated in financing various companies in the mining, oil and gas, geothermal and tech. industries. After leaving the brokerage industry in 2004 Mr. Anderson joined a Canadian based Geothermal company as a Business Development Manager, assisting in raising over $20 million for that company and forming a new Canadian exploration company with interests in British Columbia, Canada and Peru. In 2010 he and his associates acquired and vended a number of Peruvian mining assets to an Australian public company and later to a Canadian mining company where Mr. Anderson became a Director and General Manager of the Peruvian subsidiaries. Since 2019 he has been largely a private investor associated with both private and public companies.
Sung Tae Ko, current CTO of LCM Korea
As Chief Technology Officer, Mr. Sung Tae Ko leads LCM Korea's research and development, product and engineering departments and is responsible for the strategy and delivery of LCM Korea's product roadmap. Mr. Sung Tae Ko has over 26 years of experience in the secondary battery industry and is an inventor of 31 battery related patents. Mr. Sung Tae Ko holds a Ph.D. in Electric Power Electronics from the Sungkyunkwan University, Korea.
Chang Woo Son, current CMO of LCM Korea
As Chief Marketing Officer, Mr. Chang Woo Son is responsible for leading LCM Korea's domestic and global marketing strategy and execution. Mr. Son is a multiple-time CEO & CMO in the renewable energy and lithium-ion battery industries.
Leveraging a 30-year track record of expertise in technology and technology-based products and services marketing, Mr. Son is a seasoned CMO who has a proven reputation well known for helping companies introduce radically different go-to-market approaches, hone their strategic positioning and disrupt existing markets. He is an expert commissioner of Secondary Battery 3.0 Link Business Division/ICC and Professional Commissioner of Energy Valley Forum in Korea. Mr. Son is also the CEO of 2B4G Co. Ltd. and Rebecca Co., Ltd. and a graduate of the Graduate College of Education, Seoul National University.
A copy of the Amalgamation Agreement will be filed and will be accessible under ECC6's profile on SEDAR+ (www.sedarplus.ca), and in connection with the Acquisition and pursuant to the requirements of the Exchange, ECC6 will also file on SEDAR+ a filing statement which will contain details regarding the Acquisition, ECC6, LCMBC, LCM Korea and the Resulting Issuer.
The Acquisition is not a Non-Arm's Length Qualifying Transaction under the policies of the Exchange and therefore is not expected to require approval of ECC6's shareholders. Sponsorship of a qualifying transaction of a capital pool company is required by the Exchange unless an exemption from sponsorship requirement is available. ECC6 intends to apply for a waiver from sponsorship requirements. However, there is no assurance that ECC6 will obtain this waiver.
Completion of the Acquisition is subject to a number of conditions, including approval of the Exchange, completion of the QT Financing and the satisfaction of other customary closing conditions. Trading of ECC6's common shares will remain halted pending further filings with the Exchange.
On Behalf of the Board of Directors ofECC Ventures 6 Corp.
Peter Dickie
Director
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Completion of the Acquisition is subject to a number of conditions, including but not limited to, Exchange acceptance and if applicable pursuant to Exchange Requirements, majority of the minority shareholder approval. Where applicable, the Acquisition cannot close until the required approvals are obtained. There can be no assurance that the Acquisition will be completed as proposed or at all.
Investors are cautioned that, except as disclosed in the filing statement to be prepared in connection with the Acquisition, any information released or received with respect to the Acquisition may not be accurate or complete and should not be relied upon. Trading in the securities of ECC6, a capital pool company, should be considered highly speculative.
The Exchange has in no way passed upon the merits of the proposed Acquisition and has neither approved nor disapproved the contents of this news release.
Forward-Looking Statements
Statements included in this news release, including statements concerning our and LCMBC's plans, intentions, and expectations, which are not historical in nature are intended to be, and are hereby identified as, "forward‐looking statements". Forward-looking statements include, among other matters, the terms and timing of the Acquisition and the QT Financing, the growth plans of LCMBC and statements concerning the Resulting Issuer, including the composition of the Resulting Issuer's board of directors and management team. Forward‐looking statements may be, but are not always, identified by words including "anticipates", "believes", "intends", "estimates", "expects" and similar expressions. The Company cautions readers that forward‐looking statements, including without limitation those relating to the Company's and LCMBC's future operations and business prospects, are subject to certain risks and uncertainties (including, without limitation, risks that the Acquisition does not proceed, or proceed on the expected terms, geopolitical risk, regulatory and exchange rate risk) that could cause actual results to differ materially from those indicated in the forward‐looking statements. There can be no assurance that any forward-looking statement will prove to be accurate or that management's assumptions underlying such statements, including assumptions concerning the Acquisition or future developments, circumstances or results will materialize. The forward-looking statements included in this news release are made as of the date of this new release and the Company does not undertake to update or revise any forward-looking information included herein, except in accordance with applicable securities laws.
SOURCE ECC Ventures 6 Corp.
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