First Global Provides Further Detail on Earlier Updates
Toronto, Ontario--(Newsfile Corp. - June 11, 2019) - First Global Data Ltd. (TSXV: FGD) (OTC Pink: FGBDF) (FSE: 1G5) ("First Global" or the "Company") is pleased to provide additional details and clarity as they relate to the events outlined in the Company's press release of May 17, 2019.
The Company has been under a Cease Trader Order ("CTO") since May 2018 and, as a result, the Company has been unable to raise additional equity during such time. The Company continued to lose money in 2018 and, with its inability to finance operations, was forced to cease processing transactions in its USA Operations in October 2018. Without additional float capital, US transactions ground to a halt. The Company had also been unable, for some time before that, to sell any additional international special purpose software licenses (ISPLs) due to accounting and revenue recognition issues that have been previously disclosed.
The Company, under the direction of its new Board of Directors and with assistance from its senior lender, began to review various options more aligned with the Company's new vision. Such options included, among other things, canvassing the market for a sale of certain of its assets.
With regards to the binding Letter of Intent to sell First Global Money Inc. (FGMI), the Company's wholly-owned US licensed entity, no less than 6 agents were approached to find potential buyers/investors and market the deal. As a result, the Company undertook a fairly extensive process of pursuing various leads, entertaining multiple due diligence requests and expressions of interest from interested purchasers. In total, the company and its agents entered into discussions with no less than 10 potential parties.
Unfortunately, given the Company's publicly-disclosed stressors, there was considerable downward pressure on the market value of its assets. This, coupled with an urgency to move forward with a transaction at the earliest possible opportunity given the severe strain being placed on it to maintain money transmittor licenses and capitalization, the Company ultimately settled on the deal that had the potential to provide the greatest return to the Company once purchase price, debt assumption by the buyer, and royalty streams are collected. During the course of making this decision, the Company did consider the ramifications of selling such assets to a Company whose principal is a former director and officer of the Company but who, since his resignation on January 17, 2019, is no longer involved whatsoever in the decision-making or operations of the Company. Having considered same, the Company remains confident that it has secured the best possible deal for the Company given the circumstances free of conflict or any related-party concerns.
At this stage, the Company has one additional asset to market, which is its significant tax losses in certain of its technology assets, for which the company hopes to obtain some value.
Failing a major debt-for-equity transaction, which would require Ontario Securities Commission approval, and some minimum financing, the Company will likely need to seek creditor protection in the short term. The company's debt was already in excess of $16.0M USD in addition to AP of $3.0M USD at September 31, 2018.
First Global is an international financial services technology ("FINTECH") company based in Ontario.
For further information please contact:
Ruth Fraser, Manager
First Global Data Limited
Tel: 416 504-3813
Neither TSX Venture Exchange Inc. ("TSXV") 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.
The securities offered have not been registered under the U.S. Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements. This press release shall not constitute an offer to sell or a solicitation of an offer to buy nor shall there be any sale of the securities offered in any jurisdiction in which such offer, solicitation or sale would be unlawful.
FORWARD LOOKING INFORMATION
This press release is for informational purposes only and is not an offer to buy or the solicitation of an offer to sell any securities in any jurisdiction.
This press release contains certain "forward-looking information". All statements, other than statements of historical fact, that address activities, events or developments that the Company believes, expects or anticipates will or may occur in the future (including, without limitation, the plans, initiatives and strategies of the Company, its anticipated needs for funding, its sale of assets and the implementation of a debt-for-equity program or the application to, and granting by, the Ontario Securities Commission of any partial revocation order) constitute forward-looking information.
This forward-looking information reflects the current expectations or beliefs of the Company based on information currently available to the Company as well as certain assumptions.
Forward- looking information is subject to a number of significant risks and uncertainties and other factors that may cause the actual results of the Company to differ materially from those discussed in the forward-looking information, and even if such actual results are realized or substantially realized, there can be no assurance that they will have the expected consequences to, or effects on the Company. Factors that could cause actual results or events to differ materially from current expectations, include, but are not limited to, the inability of the Company to complete the sale transaction with Azira Corporation, the Company's failure to obtain a partial revocation order, the Company's inability to execute on its future plans and initiatives as currently contemplated or its failure to attract investors or to complete any shares-for-debt conversions with creditors.
Any forward-looking information speaks only as of the date on which it is made and, except as may be required by applicable securities laws, the Company disclaims any intent or obligation to update any forward-looking information, whether as a result of new information, future events or results or otherwise. Although the Company believes that the assumptions inherent in the forward-looking information are reasonable, forward-looking information is not a guarantee of future performance and accordingly undue reliance should not be put on such information due to the inherent uncertainty therein.
To view the source version of this press release, please visit https://www.newsfilecorp.com/release/45476