NowVertical Group, Inc. Closes Oversubscribed Subscription Receipt Private Placement for Gross Proceeds of Approximately C$8.4 million
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TORONTO, March 23, 2021 /CNW/ - NowVertical Group, Inc. ("NVG") is pleased to announce that it has closed its previously announced private placement of subscription receipts (each a "Subscription Receipt" and collectively, the "Subscription Receipts") by issuing, through its wholly-owned Canadian subsidiary, NVG Canada Finco, Inc. ("Finco"), 8,394,000 Subscription Receipts at a price of $1.00 per Subscription Receipt, for gross proceeds to Finco of approximately C$8.4 million (the "Private Placement"). The Private Placement was conducted in connection with NVG's going-public transaction by way of a reverse takeover (the "Reverse Take-Over") involving, among others, Good2Go Corp. ("G2G"), a "capital pool company" listed on the TSX Venture Exchange.
Each Subscription Receipt will be automatically exchanged, without any further action by its holder, and for no additional consideration, for one common share of Finco (a "Finco Share") upon the satisfaction of certain Escrow Release Conditions (as defined below). Upon completion of the Reverse Take-Over, each underlying Finco Share issued pursuant to exchange of the Subscription Receipts will be exchanged for one class A subordinate voting share of the resulting issuer, G2G, which is proposed to be named "NowVertical Group, Inc." (the "Resulting Issuer") or such other name designated by NVG and that is acceptable to the regulatory authorities.
The Private Placement was conducted through a syndicate of securities dealers led by Echelon Wealth Partners Inc. (the "Lead Agent") and including Canaccord Genuity Corp., Stifel Nicolaus Canada Inc. and Haywood Securities Inc. (together with the Lead Agent, the "Agents").
The gross proceeds from the sale of the Subscription Receipts, less expenses and fifty percent of the Agents' cash fee paid at the closing of the Private Placement, are being held in escrow by TSX Trust Company ("TSX Trust") in accordance with a subscription receipt agreement dated March 23, 2021 among NVG, Finco, TSX Trust and the Lead Agent, and will be released to Finco upon satisfaction and/or waiver of certain escrow release conditions (the "Escrow Release Conditions"), including completion of the Reverse Take-Over.
NVG will use the net proceeds from the Private Placement: (a) to fund the business plan of NVG; (b) for Reverse Take-Over expenses; (c) strategic acquisitions; and (d) for general corporate purposes and future working capital of the Resulting Issuer. Although NVG intends to use the net proceeds from the Private Placement as described herein, the actual allocation of proceeds may vary, depending on future operations or unforeseen events or opportunities.
On March 22, 2021, NVG, G2G, Finco, 2824877 Ontario Inc. ("PubCo Sub") and Good2Go (US) Corp. ("Merger Sub") both wholly-owned subsidiaries of G2G, entered into an business combination agreement in connection with the Reverse Take-Over. The Reverse Take-Over will proceed, amongst other steps, by way of a "three-cornered" amalgamation and a reverse triangular merger, pursuant to which (i) Finco and Pubco Sub will amalgamate and the resulting entity will become a wholly-owned subsidiary of G2G; and (ii) NVG and Merger Sub will merge and the resulting entity will become a wholly-owned subsidiary of G2G.
In connection with the Private Placement, Finco paid the Agents a cash fee in an aggregate amount of $587,580 (50% payable on the closing date of the Private Placement and 50% payable upon satisfaction of the Escrow Release Conditions) and issued an aggregate of 587,580 compensation warrants (the "Compensation Warrants") to the Agents, each entitling its holder to purchase one Finco Share at a price of $1.00 for a period of 24 months following the date of the completion of the Escrow Release Conditions. Provided the Escrow Release Conditions are satisfied, pursuant to the Reverse Take-Over, the Compensation Warrants will be exchanged for Compensation Warrants of the Resulting Issuer, each entitling its holder to purchase one share of the Resulting Issuer, at a price of $1.00 for a period of 24 months following the date of the completion of the Escrow Release Conditions. Fifty percent of the Agents' cash commission has been deposited in escrow with TSX Trust and will be released to the Agents upon satisfaction and/or waiver of the Escrow Release Conditions.
Forward-Looking Information
This release includes forward-looking information within the meaning of Canadian securities laws regarding G2G and NVG and their respective businesses, which may include, but are not limited to, statements with respect to the completion of the Reverse Take-Over and Private Placement, the terms on which the Reverse Take-Over and Private Placement is intended to be completed, the ability to obtain regulatory and shareholder approvals and other factors. Often but not always, forward-looking information can be identified by the use of words such as "expect", "intends", "anticipated", "believes" or variations (including negative variations) of such words and phrases, or state that certain actions, events or results "may", "could", "would" or "will" be taken, occur or be achieved. Such statements are based on the current expectations and views of future events of the management of each entity, and are based on assumptions and subject to risks and uncertainties. Although the management of each entity believes that the assumptions underlying these statements are reasonable, they may prove to be incorrect. The forward-looking events and circumstances discussed in this release, including completion of the Reverse Take-Over and Private Placement (and the proposed terms upon which the Reverse Take-Over and Private Placement is proposed to be completed), may not occur and could differ materially as a result of known and unknown risk factors and uncertainties affecting the companies, including risks regarding the threat detection technology industry, market conditions, economic factors, management's ability to manage and to operate the business of the Resulting Issuer and the equity markets generally. Although G2G and NVG have attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results to differ from those anticipated, estimated or intended. Accordingly, readers should not place undue reliance on any forward-looking statements or information. No forward-looking statement can be guaranteed. Except as required by applicable securities laws, forward-looking statements speak only as of the date on which they are made and neither G2G nor NVG undertakes any obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise
This news 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 or to U.S. persons unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available. Not for distribution to U.S. newswire services or for dissemination in the United States. Any failure to comply with this restriction may constitute a violation of U.S. securities laws.
SOURCE NowVertical Group, Inc.
For more information regarding NowVertical Group, Inc., please contact: Daren Trousdell, President, [email protected]
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