Australis Capital Announces Amended Terms for the Purchase of Passport Technology Inc.

Australis Capital Inc. (CSE: AUSA) (OTC: AUSAF) (“AUSA” or the “Company“) today announced that certain terms for the purchase of Passport Technology Inc. (“Passport“) have been updated to reflect additional contract signings by Passport since the announcement of the transaction. As disclosed in a June 25 press release, AUSA agreed to pay an earnout to Passport as follows:

• $2 million in shares of AUSA and Body and Mind Inc. (“BaM“) if the Company achieves over $7 million in revenue in 2021
• An additional $2 million in shares of AUSA and BaM if the Company achieves over $8 million in revenue in 2021
• 25% of revenue in excess of $7 million in 2021 if Passport EBITDA for 2021 is above $3 million

Since the June 25 announcement, Passport has announced signing 16 additional Gateway Casinos in British Columbia and Alberta. Based on this signing, Passport provided an expectation of achieving $12 million of revenue in 2021 and $4 million of operating income.  AUSA and Passport have agreed to amend the terms of the earnout as follows:

• $2 million in shares of AUSA and BaM if the Company achieves over $8.5 million in revenue in 2021
• An additional $2 million in shares of AUSA and BaM if the Company achieves over $9.5 million in revenue in 2021
• 25% of revenue in excess of $8.5 million in 2021 if Passport EBITDA for 2021 is above $3 million

Based on the purchase price plus revised earnouts, AUSA will pay roughly 9.1x 2021 operating income if Passport achieves its expectations.

“We are pleased with the progress that Passport continues to make in its markets and are happy that Passport is willing to back up its confidence with these amended terms,” said Cleve Tzung, CEO of AUSA. “With the increase in the threshold of Passport’s earn-out structure, AUSA shareholders now will retain even more upside value that will be generated from this combined transaction.”

All other terms of the transaction announced June 25 remain unchanged. For further details please refer to the June 25 press release at: https://ausa-corp.com/news/australis-capital-announces-expansion-of-fintech-platform-to-include-gaming-through-proposed-acquisition-of-passport-technology-and-private-placement-of-units/.

This news release does not constitute an offer to sell or a solicitation of an offer to buy any of the securities described in this news release in the United States. Such 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, accordingly, may not be offered or sold within the United States, or to or for the account or benefit of persons in the United States or “U.S. Persons”, as such term is defined in Regulation S promulgated under the U.S. Securities Act, unless registered under the U.S. Securities Act and applicable state securities laws or pursuant to an exemption from such registration requirements.