Spirit Banner II Capital Corp. Announces Closing of Subscription Receipt Financing and Execution of Definitive Agreement to Complete Qualifying Transaction with Sabio Mobile, Inc.

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Toronto, Ontario–(Newsfile Corp. – October 15, 2021) – Spirit Banner II Capital Corp. (TSXV: SBTC.P) (“Spirit Banner” or the “Corporation“), is pleased to provide an update on its proposed business combination with Sabio Mobile, Inc. (“Sabio“) and announce the closing of the previously announced private placement of subscription receipts (the “Subscription Receipts“) for aggregate gross proceeds of C$6,559,316 (the “Concurrent Financing“) by Sabio Canada Finco, Inc. (“Finco“), an Ontario corporation and a wholly-owned subsidiary of Sabio, and execution of a binding business combination agreement (the “Business Combination Agreement”) with Sabio with respect to completion of the proposed arm’s length reverse-takeover transaction of Sabio by Spirit Banner (the “Proposed Transaction“), which will constitute Spirit Banner’s Qualifying Transaction (as such term is defined in Policy 2.4 – Capital Pool Companies of Corporate Finance Manual of the TSX Venture Exchange (the “Exchange“)).

Closing of Concurrent Financing

Further to the Corporation’s press release dated June 29, 2021, on October 14, 2021, Finco closed the Concurrent Financing, comprised of a brokered private placement offering of Subscription Receipts (the “Brokered Offering“) and concurrent non-brokered offering of Subscription Receipts (the “Non-Brokered Offering“).

Pursuant to the Brokered Offering, Finco issued an aggregate of 2,888,870 Subscription Receipts at a purchase price of $1.75 per Subscription Receipt for gross proceeds of $5,055,522. Pursuant to the Non-Brokered Offering, Finco issued an aggregate of 859,311 Subscription Receipts for gross proceeds of $1,503,794. Each Subscription Receipt entitles the holder thereof to receive, without payment of any additional consideration and without further action on the part of each subscriber, subject to adjustment, one common share in the capital of Finco (“Finco Share“) in accordance with the terms of a subscription receipt agreement entered into between Finco, Sabio, Beacon Securities Limited (“Beacon“), Paradigm Capital Inc. (“Paradigm” and, together with Beacon, the “Co-Lead Agents“), and TSX Trust Company, dated October 14, 2021 (the “Subscription Receipt Agreement“), upon the satisfaction or waiver of the escrow release conditions described in the Subscription Receipt Agreement (the “Escrow Release Conditions“). Upon the closing of the Proposed Transaction, the Finco Shares issued pursuant to the conversion of the Subscription Receipts will be automatically exchanged for shares of the Resulting Issuer pursuant to the Business Combination Agreement on a one-for-one basis.

In connection with the Concurrent Financing, and pursuant to the terms of an agency agreement dated October 14, 2021, entered into by the Co-Lead Agents, Echelon Wealth Partners Inc. and PI Financial Corp. (collectively, the “Agents“), the Corporation, Finco, and Sabio (the “Agency Agreement“), the Agents are entitled to: (i) an aggregate cash commission of $277,717, being equal to 7% of the gross proceeds raised under the Brokered Offering (the “Cash Fee“) (other than for the gross proceeds raised from subscribers on a president’s list provided by Sabio (the “President’s List“)) in respect of which a cash commission of 2.0% was paid to the Agents), and (ii) an aggregate of 162,296 compensation warrants (the “Compensation Warrants“), being the number of compensation warrants as is equal to 7% of the Subscription Receipts sold through the Brokered Offering (other than for Subscription Receipts issued to subscribers on the President’s List, in respect of which the Agents were issued that number of compensation warrants equal to 2.0% of the Subscription Receipts issued to such subscribers shall be issued to the Agents). In addition, the Agents were paid a corporate finance fee of $14,464 (the “Corporate Finance Fee“) and were issued an aggregate of 7,300 corporate finance warrants (the “Corporate Finance Warrants” and together with the Compensation Warrants, the “Agents’ Warrants“) pursuant to the terms of the Agency Agreement. Further, the Corporation has agreed to pay to Zelos Capital Ltd (“Finder“) (i) a finder’s cash fee of $10,641, being 7% of the principal amount of Subscription Receipts issued to subscribers introduced by the Finder; and (ii) issue 6,080 warrants (“Finder’s Warrants“), being that number of warrants to purchase a number of shares in Finco equal to 7% of the principal amount of Subscription Receipts issued to subscribers introduced by the Finder, on closing of the Proposed Transaction. Each Agents’ Warrant and Finder’s Warrant will be exchangeable into one warrant of the Resulting Issuer, which warrant shall entitle the holder thereof to subscribe for a Resulting Issuer Share at a price of $1.75 per share for a period of 24 months from the date of satisfaction of the Escrow Release Conditions.

The gross proceeds of the Concurrent Financing less: (i) 50% of the Cash Fee; (ii) the Corporate Finance Fee; and (iii) the expenses of the Agents incurred in connection with the Concurrent Financing, have been deposited in escrow pending the satisfaction of the Escrow Release Conditions.

Sabio intends to use the net proceeds from both the Concurrent Financing for business development, working capital requirements, and general corporate purposes.

Execution of Definitive Agreement

Spirit Banner is pleased to announce that, further to the letter of intent entered into on June 23, 2021, and any amendments thereto, with Sabio (the “LOI“), it has entered into the Business Combination Agreement effective on October 13, 2021 with Sabio, Finco, 2872484 Ontario Inc. (“Pubco Sub“), a wholly-owned subsidiary of the Corporation, and Spirit Banner Merger Sub, Inc. (“Merger Sub“), a wholly-owned subsidiary of the Corporation, in respect of completion of the Proposed Transaction.

Upon completion of the Proposed Transaction, the resulting company’s primary business will be that of Sabio’s current business, being an advertisement software and services company.

The completion of the Proposed Transaction is subject to the satisfaction of various conditions that are customary for a transaction of this nature, including but not limited to: (i) satisfaction of the Escrow Release Conditions; (ii) completion of the consolidation of securities of each of Spirit Banner and Sabio; (iii) completion of the amalgamation between Finco and Pubco Sub and the merger between Merger Sub and Sabio in connection with the Proposed Transaction; and (iv) receipt of all requisite approvals, including approval of the Exchange and the shareholders of Sabio and all other necessary consents of other third parties.

Trading in the common shares in the capital of Spirit Banner is currently halted in accordance with the policies of the Exchange and will remain halted until such time as all required documentation in connection with the Proposed Transaction has been filed with and accepted by the Exchange and permission to resume trading has been obtained from the Exchange.

The terms of the Proposed Transaction were previously described in the Corporation’s press release dated June 29, 2021 (“June Press Release“), and will include, amongst other steps, a consolidation by each of Spirit Banner and Sabio of its respective securities, a “three-cornered” amalgamation between Finco and Pubco Sub, and a reverse triangular merger between Sabio and Merger Sub, following which Sabio will become a wholly-owned subsidiary of Spirit Banner. For further details on the Proposed Transaction, please refer to the June Press Release.

The Proposed Transaction is subject to a number of conditions including, without limitation, approval of the Exchange. There can be no assurance that the Proposed Transaction will be completed on the terms as proposed or at all.

About Sabio Mobile, Inc.

Sabio provides a CTV platform that is powered by mobile data, providing leading brands with the perfect balance between media, data and technology. Sabio’s unique approach to combining mobile data, device location and consumer behaviors aims to provide brands with more effective targeting and greater prediction accuracy for their mobile and connected TV ad campaigns. Sabio’s team of experienced marketers, engineers and data scientists are passionately innovative in everything they do, from developing Sabio’s proprietary audience platform and ad server to creating and delivering stunning ads on connected TVs and mobile devices.

About Spirit Banner II Capital Corp.

Spirit Banner is a capital pool company created pursuant to the policies of the TSXV. It does not own any assets, other than cash or cash equivalents and its rights under the LOI. The principal business of Spirit Banner is to identify and evaluate opportunities for the acquisition of an interest in assets or businesses and, once identified and evaluated, to negotiate an acquisition or participation subject to acceptance by the TSXV so as to complete a Qualifying Transaction in accordance with the policies of the TSXV.

Forward-Looking Statements Disclaimer

Certain information in this press release may contain forward-looking statements. This information is based on current expectations that are subject to significant risks and uncertainties that are difficult to predict. Actual results might differ materially from results suggested in any forward-looking statements. Spirit Banner assumes no obligation to update the forward-looking statements, or to update the reasons why actual results could differ from those reflected in the forward looking-statements unless and until required by securities laws applicable to Spirit Banner.

Additional information identifying risks and uncertainties is contained in filings by Spirit Banner with the Canadian securities regulators, which filings are available at www.sedar.com.

Completion of the Proposed Transaction is subject to a number of conditions, including but not limited to, TSXV acceptance and, if applicable pursuant to TSXV requirements, majority of the minority shareholder approval. Where applicable, the transaction cannot close until the required shareholder approval is obtained. There can be no assurance that the transaction will be completed as proposed or at all.

Investors are cautioned that, except as disclosed in the management information circular or filing statement to be prepared in connection with the Proposed Transaction, any information released or received with respect to the transaction may not be accurate or complete and should not be relied upon. Trading in the securities of a capital pool company should be considered highly speculative.

The TSX Venture Exchange Inc. has in no way passed upon the merits of the Proposed Transaction and has neither approved nor disapproved the contents of this press release.

For more information about Spirit Banner, please contact Matthew Wood, Chief Executive Officer, at (647) 951-650.

NOT FOR DISTRIBUTION TO UNITED STATES WIRE SERVICES OR DISSEMINATION IN THE UNITED STATES. 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. THIS NEWS RELEASE DOES NOT CONSTITUTE AN OFFER OR SALE OF SECURITIES IN THE UNITED STATES.

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/99877