Montreal, Quebec--(Newsfile Corp. - October 16, 2015) - Peak Positioning Technologies Inc. (TSXV: PKK) (OTC Pink: PKKFF) ("Peak" or the "Company") today announced its plans to acquire 100% of the issued and outstanding shares of LongKey Hong Kong Limited ("LongKey") instead of the 51% interest in LongKey originally announced.
Today's announcement was made possible in part by the Company's decision to migrate from the TSX Venture Exchange (the "TSXV") to the Canadian Securities Exchange (the "CSE"), which gives Peak the flexibility it needs to re-structure its transaction with LongKey.
"Considering the value that Peak is getting with the acquisition of LongKey, it's only fitting that LongKey's shareholders be adequately compensated with the number of Peak shares that they would be receiving in exchange of their LongKey shares", commented Johnson Joseph, President and CEO of Peak. "Now that Peak will be trading on the CSE, we'll have the flexibility to issue a number of shares to LongKey's shareholders to be able to immediately acquire 100% of the company, which has always been our objective from the very beginning", added Mr. Joseph.
Less Cash Required for Acquisition and Operations
Under the terms of the existing agreement between Peak and LongKey, Peak is to issued 82,000,000 Peak shares to LongKey's shareholders and contribute $1.6M to LongKey's working capital to help grow its financial services line of business. In order to meet its working capital obligations towards LongKey, Peak announced a private placement financing consisting in the issuance of a maximum of 160,000,000 units at $0.025 per unit for gross proceeds of up to $4M. Each unit (a "Unit") to be comprised of one (1) common share and one (1) common share purchase warrant, each warrant allowing its holder to subscribe to one (1) common share at a price of $0.04 for a period of 12 months following the close of the private placement.
Between today and the date on which the terms of the private placement financing were originally announced in June 2015, Peak and LongKey have been collaborating to help transition LongKey's financial services client setup process to a self-registration process to dramatically reduce, if not eliminate, the client setup costs. The result of those efforts is that it is now estimated that LongKey's financial services working capital requirements will be far less than expected back in June. And since the amount of the previously announced private placement financing was predicated by LongKey's present and near term working capital needs, the Company can now revise and limit the amount of the private placement financing required to allow it to close the LongKey acquisition to a minimum of $500,000 and a maximum of $800,000, which the Company expects to close concurrent to its listing on the CSE on October 23, 2015.
"Needing less capital to close the LongKey transaction is good news for all Peak shareholders", commented Mr. Joseph. "Having fewer shares in circulation allows us to issue shares to LongKey without excessively diluting our existing shareholder based. But not only that, it also means that we can revisit the previously announced 5 to 1 consolidation of Peak's shares, which was to occur in conjunction with the closing of the LongKey acquisition. We will now reconsider the timing and the ratio of the consolidation to ensure that it's done in the best interest of all of our shareholders", concluded Mr. Joseph.
More details about the Company's expected revised acquisition terms with LongKey will be provided following its official move to the CSE.
About Peak Positioning Technologies Inc.:
Peak Positioning Technologies Inc. is an IT portfolio management company whose mission is to assemble, finance and manage a portfolio of high-growth-potential companies and assets in some of the fastest growing tech sectors in China, including e-commerce, cloud-computing and mobile development. Peak provides its shareholders access to the world's fastest growing economy by giving them the opportunity to participate in these high-growth sectors in partnership with some of the most reputable and high profile institutions. For more information: http://www.peakpositioning.com.
The TSX Venture Exchange has neither approved nor disapproved the contents of this news release. Neither the TSX Venture Exchange, Inc. nor its Regulation Service Provider (as that term is defined under the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of the contents of this news release.
For more information:
Cathy Hume
CEO
CHF Investor Relations
Phone: 416-868-1079 ext.: 231
Email: cathy@chfir.com
Or
Carl Desjardins
Managing Partner
Paradox Public Relations Inc.
Phone: 514-341-0408
Email: carldesjardins@paradox-pr.ca
Or
Johnson Joseph
President and CEO
Peak Positioning Technologies Inc.
Phone: 514-340-7775 ext.: 501
Email: investors@peakpositioning.com