VANCOUVER, Feb. 22, 2018 /CNW/ - Lightning Ventures Inc. (CSE: LVI) (the "Company") is pleased to announce that, as part of an overall effort to reduce debt and streamline operations, it has agreed to sell all of the issued and outstanding shares of its wholly-owned New Mexico subsidiary, Lightning Industries, Inc. (the "Lightning Subco"), to Titan Products, LLC, an unrelated limited liability company with offices in Overland Park, Kansas.
Lightning Subco's principal assets include its intellectual property and a small production facility located in Hobbs, New Mexico that was used during the development of the Company's Hot Trailer and Chemical Injection System but is not suitable for commercial production. These assets are highly leveraged – Lightning Subco's debt exceeds the value of its assets by more than $1.4 million. As part of its effort to streamline operations, the Company has agreed to sell Lightning Subco to Titan Products and outsource commercial production of its products.
The Company's agreement with Titan Products, which is dated February 14, 2018, provides for a nominal cash purchase price of ten U.S. dollars and a license back to the Company of Lightning Subco's intellectual property. Closing of the sale is subject to customary conditions, including regulatory and stock exchange approval.
At Closing, Lightning Subco will grant to the Company an exclusive license to manufacture, distribute, sell and service the Hot Oil Trailer and Chemical Injection System in all countries, together with the exclusive right to patent these products anywhere in the world other than in the United States. In exchange, the Company has agreed to pay to Titan Products a royalty equal to three percent of gross sales revenue from sales in the United States. Management believes that the sale of Lightning Subco will result in the immediate reduction of the Company's debt (by approximately $2.3 million), as well as overhead and operating costs.
About Lightning Ventures
Lightning Ventures Inc. is an oil and gas industrial services company engaged in the manufacture and sale of products intended to enhance efficiency and increase the production of oil and gas wells.
Further information about Lightning Ventures is available under its profile on the SEDAR website www.sedar.com.
Neither the Canadian Securities Exchange nor its Market Regulator (as that term is defined in the policies of the Canadian Securities Exchange) accepts responsibility for the adequacy or accuracy of this release.
This news release may contain forward-looking statements based on assumptions and judgments of management regarding future events or results. Such statements are subject to a variety of risks and uncertainties which could cause actual events or results to differ materially from those reflected in the forward-looking statements. The company disclaims any intention or obligation to revise or update such statements.
SOURCE Lightning Ventures Inc.
For further information: on the Company, please contact: Donald Rainwater, Chief Executive Officer, Lightning Ventures Inc., Telephone: 210-535-5700, Email: [email protected]
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