Turnium Technology Group Announces Closing of First Tranche of Unsecured Convertible Note Offering
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May 17, 2023 – Vancouver, Canada – Turnium Technology Group Inc. (TSX.V: TTGI) (“Turnium” or the “Company”), an industry leader in cloud-native software-defined wide area networking solutions (SD-WAN), announces that it has closed the first tranche of its previously announced non-brokered private placement of unsecured convertible notes (the “Notes”) for aggregate gross proceeds of up to CAD$1,000,000 (the “Offering”). The first tranche closing of the Offering was comprised of the issuance of unsecured convertible notes in the aggregate principal amount of CAD$276,500 (the “First Tranche Closing”). The Notes issued in connection with the First Tranche Closing (the “First Tranche Notes”) will mature on May 16, 2026.
Subject to the approval of the TSX Venture Exchange (the “TSXV”), the First Tranche Notes will be convertible, at the sole discretion of the holder, into units of the Company (“Units”) at a conversion price of $0.16 per Unit (the “Conversion Price”). Each Unit shall consist of one Common share in the capital of the Company (a “Common Share”) and one-half of one Common share purchase warrant of the Company (each whole warrant, a “Warrant”). Each Warrant entitles the holder thereof to acquire one Common Share (each, a “Warrant Share”) at $0.16 per Warrant Share until May 16, 2026, subject to adjustment in certain customary events.
Notwithstanding the foregoing, the First Tranche Notes, together with any other Notes issued pursuant to the Offering, may not be converted until the Company’s loan with FirePower Capital, as described in the Company’s news release dated November 30, 2022, has been extended or has otherwise been terminated.
The Company may, at its option, accelerate the expiry date of the Warrants on thirty days’ notice if the volume weighted average trading price of the Common Shares on the TSXV is greater than $0.30 for the preceding ten (10) consecutive trading days.
The First Tranche Notes will be unsecured obligations of the Company and shall rank pari passu in right of payment of principal and interest with all other Notes issued under the Offering and all previously existing and future unsecured indebtedness of the Company.
At any time and from time to time after September 16, 2023, the Company may, at its option, redeem pro rata all or part of the First Tranche Notes, upon not less than 30 nor more than 60 days’ prior written notice, at a redemption price (payable in cash) which is equal to 110% of the principal amount thereof plus any accrued and unpaid interest that would otherwise be payable to the holder from the time of such option redemption until May 16, 2026.
The First Tranche Notes were offered for sale on a non-brokered private placement basis in Canada to “accredited investors” within the meaning of National Instrument 45-106 – Prospectus Exemptions.
In connection with the First Tranche Closing, the Company has entered into finder’s fee agreements with qualified arm’s length finders, in accordance with securities laws and the policies of the TSXV (the “Finders”). The Company has paid a cash finder’s fee to the Finders in the aggregate amount of CAD$5,250.
Each of Mr. Ralph Garcea, Mr. James Lovie, and Mr. Peter Green, each of whom are Directors of the Company, participated in the First Tranche Closing. The participation of each of Mr. Garcea, Mr. Lovie and Mr. Green in the First Tranche Closing constitutes a “related party transaction” within the meaning of Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions (“MI 61-101”). This transaction is exempt from the formal valuation and minority shareholder approval requirements of MI 61-101 pursuant to sections 5.5(a) and 5.7(1)(a) of MI 61-101 as neither the fair market value of any securities issued, nor the consideration paid by such person exceeds 25.0% of the Company’s market capitalization.
The Company intends to use the net proceeds from the First Tranche Closing for general corporate and working capital purposes.
The First Tranche Notes will not be assignable, transferable or negotiable. The First Tranche Notes will be subject to a statutory hold period expiring on September 17, 2023. The closing of any additional tranches of the Offering is subject to the approval of the TSXV.
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 as defined under applicable United States securities laws unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.
About Turnium Technology Group, Inc.
Turnium Technology Group Inc. delivers its SD-WAN solution as a white label, containerized, disaggregated software platform that channel partners host, manage, brand, and price and as a managed cloud-native service provided by Turnium. Both Turnium SD-WAN offers are available through a channel partner program designed for Communications Service Providers, Internet and Managed Service Providers, System Integrators, and Value-Added Resellers.
SD-WAN is revolutionizing the networking and telecommunications industry by abstracting secure, high-speed networking and network control from underlying physical circuits. SD-WAN frees enterprises, small and medium businesses, cloud and managed services providers from the business and cost constraints imposed by traditional telecommunications companies.
Investor Relations: Bill Mitoulas, email: firstname.lastname@example.org, telephone: +1 416-479-9547
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSXV) accepts responsibility for the adequacy or accuracy of this release.
This announcement contains “forward-looking” statements within the meaning of applicable securities laws. Forward-looking statements and information relate to future events and future performance and reflect the Company’s expectations regarding: completion of additional tranches of the Offering and the use of net proceeds of the First Tranche Closing. Forward-looking statements may be identified by words such as “seek”, “believe”, “plan”, “estimate”, “anticipate”, expect”, “intend”, and statements that an event or result “may”, “will”, “should”, “could”, or “might” occur or be achieved and any other similar expressions.
Forward-looking statements involve risks and uncertainties which may cause actual results to differ materially from the statements made. Factors that could cause or contribute to such differences include, but are not limited to: the timing and possible outcome of regulatory approvals in connection with the Offering; the possibility that additional tranches of the Offering may not close; general economic, market and business conditions in Canada; risks relating to the effective management of the Company’s growth; fluctuations in foreign exchange and interest rates and stock market volatility; and political and economic conditions.
There are no assurances that the Company can fulfill forward-looking statements and information. Such forward-looking statements and information are only predictions based on current information available to the Company’s management team as of the date that such predictions are made; actual events or results may differ materially as a result of risks facing the Company, some of which are beyond its control. Although the Company believes that any forward-looking statements and information contained in this press release are based on reasonable assumptions, readers cannot be assured that actual outcomes or results will be consistent with such statements. Accordingly, readers should not place undue reliance on forward-looking statements and information.
The Company expressly disclaims any obligation or undertaking to disseminate any updates or revisions to any forward-looking statements contained herein to reflect any change in the expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based.