Announcements - Corporate News

June 21, 2018

Flow Capital Announces Binding Agreement to Sell Agnity Global Royalty to Universal mCloud

Flow Capital Announces Binding Agreement to Sell Agnity Global Royalty to Universal mCloud

TORONTO, June 21, 2018 – Flow Capital Corp. (“Flow Capital” and “Flow”) today announced that it has signed a binding agreement to sell its Royalty Agreement with Agnity Global (“Agnity”), an industry leader in LTE/4G/5G mobile IoT applications, to Universal mCloud Corp (TSX-V: MCLD) (OTCQB: MCLDF) (“mCloud”).

Pursuant to the sale, mCloud will pay Flow Capital $2M USD in cash and 1.5M in mCloud shares at close, and another 3.5M shares if certain milestones are met.

“We are excited to be shareholders in mCloud, given the company’s proven team and track record, and the global market opportunity that it is attacking. We’re also very pleased to be participating in Agnity’s continued growth through mCloud. This deal is an example of Flow Capital’s strategy of leveraging our upside exposure to benefit from the success of our portfolio companies,” said Robb McLarty, Acting Chief Executive Officer of Flow Capital.

For mCloud, this transaction extends the company’s capacity to reach all parts of North America, Asia, and Europe and solidifies its position as the eminent provider of IoT asset management solutions for smart buildings, wind, and power utility providers.

“mCloud’s AssetCare platform is now connected to over 15,000 assets around the world and Agnity’s mobile capabilities are already being applied to our AI and Analytics offerings in the field, empowering field workers to achieve successful outcomes,” said Russel McMeekin, mCloud President and CEO. “This transaction will allow mCloud to offer enhanced IoT capabilities to our customers, such as blockchain-based mobile security, while simultaneously doubling our high-margin recurring revenue base and positioning mCloud for profitability in the near term.”

The Binding Agreement is subject to customary regulatory approval and a break up fee.

About Flow Capital Corp.

Based in Toronto, Flow Capital Corp. is a diversified alternative asset investor and advisor, operating two divisions: an investment operation providing revenue-linked capital to emerging growth businesses, and an institutional advisory sales platform providing pension funds, charities and endowment clients with access to leading institutional money managers from around the world. Learn more at www.flowcap.com.

About Universal mCloud Corp.

Universal mCloud Corp. is headquartered in Vancouver, BC with technology and operations centers in San Francisco, CA and Bristol, PA. mCloud is an IoT connected asset care cloud solution company utilizing connected IoT devices, leading deep energy analytics, secure mobile and 3D technologies that rally all asset stakeholders around an Asset-Circle-of-Care™, providing complete real-time and historical data coupled with guidance and advice based on deep analytics and diagnostics resulting in optimal performance and care of critical equipment. It’s all about the asset. The powerful and secure AssetCare™ environment is accessible everywhere, 24/7 through standard mobile devices, ruggedized headsets, and web browsers. For more information, visit www.mCloudCorp.com.

For further information, please contact:

Flow Capital Corp.

Robb McLarty
Chief Executive Officer (Acting)
robb@flowcap.com

Phone: (416) 777-0383

1 Adelaide Street East, Suite 3002,

Toronto, Ontario M5C 2V9

 

Universal mCloud Corp.

Madelin Daviau

NATIONAL | Equicom

T: 416-848-9833

mdaviau@national.ca

 

Russ McMeekin

Chief Executive Officer

Universal mCloud Corp.

T: 415-635-3500

June 14, 2018

Flow Capital Articulates Vision and Provides Corporate Update

Flow Capital Articulates Vision and Provides Corporate Update

TORONTO, June 14, 2018– Flow Capital Corp. (TSXV: FW)(“Flow Capital”,“Flow” or the “Company”) is pleased to provide the following corporate update.

Flow Capital Vision

Flow Capital is a diversified alternative asset investor and advisor, operating two divisions: an investment operation providing revenue-linked capital to emerging growth businesses, and an institutional advisory sales platform providing pension funds, charities and endowment clients with access to leading institutional money managers from around the world.

The investment operation will utilize the Flow Capital name and brand in the marketplace. Flow will primarily make revenue-linked investments in North American emerging growth businesses and will also provide a range of financial products and advisory services to assist these companies in fulfilling their growth objectives.  Flow is seeking to fill a significant unmet need in the financing market for profitable or near profitable, small and medium sized enterprises (“SMEs”) looking to grow their business without the dilution of equity or heavily restrictive covenants of secured debt. This operation – the former Grenville royalty investment business – will continue to execute on the investment direction that was established in 2016.

Flow Capital’s last three investments are emblematic of its growth-oriented investment thesis. Solar Brokers, Stability Healthcare and Dionymed Holdings earn greater than $69 million in combined run-rate revenue.  They are companies of scale and growth.  Each company has a strong customer value proposition, is capital efficient, and is led by a proven management team with a significant ownership stake.

Boardwalktech, which recently listed on the TSX Venture Exchange (the “TSXV”), is representative of Flow Capital’s ability to not only invest capital, but also provide expertise in exchange for equity, in order to concurrently build value in its portfolio companies and generate returns for its shareholders. Advisory services will remain one of Flow Capital’s key offerings to SMEs.

Flow Capital’s second line of business will retain its former brand and be known as LOGiQ Global Partners. Global Partners has relationships with over thirty third-party investment managers, which ensures that pension and endowment clients have exposure to highly-skilled investment managers in every asset class and style, including the burgeoning market for alternative investment vehicles.  LOGiQ generates recurring fees from the investment mandates it secures on behalf of investment managers.

Flow Capital earned revenues of approximately $2,544,420and generated cash in Q1 2018, and on June 7, 2018 held a cash balance of approximately $9.1 million.  Synergies are expected through the rationalization of back office and financial operations.

Board of Directors

Flow also wishes to announce that Alan Torrie has been appointed as a director of the Company and will become Chair of Flow’s Audit Committee.

Alan Torrie brings extensive executive, financial and director experience to the Flow Capital Board.  He has held several senior executive roles, including as the former President and Chief Executive Officer of Morneau Shepell and MDS Diagnostics. He currently serves as Chair of the Board of Extendicare and is a Director and member of the Audit Committee and Governance Committee of Green Shield Canada.  He previously served as a Director of Trillium Health Partners, Cynapsus Therapeutics, and Appleby College.

“We are delighted and feel privileged to have an executive of Alan’s experience, stature and integrity join us as we execute on the vision of Flow Capital,” stated Vernon Lobo.

Contemporaneous with Alan’s appointment as a director, Peter Kampian and Eldon Smith have resigned from the board. Flow Capital wishes to thank Peter and Eldon for their contributions and service to Flow’s predecessor companies.

Vernon Lobo has assumed the role of Executive Chair and will continue to chair Flow Capital’s Investment Committee. Catherine McLeod-Seltzer, formerly Chair of Grenville’s board, will continue to serve as a Director of Flow.

“We are very happy to announce that Vernon Lobo has agreed to assume the role of Executive Chair of the company. Since he took the position of Chair of the Investment Committee in late 2016, there has been a notable change in the terms and structure of our investments. These include stronger incentive alignment with managers/owners, better security interests, and in certain cases, additional upside in the form of equity participation through instruments such as warrants. He also played an instrumental role in sourcing and negotiating the LOGiQ transaction.  We look forward to having him continue to source investments and provide guidance on deal terms and structure as we embark on a more refined and disciplined strategy to create value.  As part of that transition, the board has approved certain option grants and a private placement to ensure that key executives are properly motivated and aligned with shareholders to create value moving forward,” stated Catherine McLeod-Seltzer.

Option Grants

The Corporation has granted options to acquire an aggregate of 2,700,000 Common Shares to its Executive Chairman and Chief Financial Officer on the following terms:

Grantee Number of Options Granted Price per Share Expiry Date Vesting Terms
Vernon Lobo, Director and Executive Chairman 2,500,000 $0.18 June 13, 2023 Quarterly in equal tranches over a 5 year period
Donnacha Rahill, Chief Financial Officer 200,000 $0.18 June 13, 2023 Quarterly in equal tranches over a 5 year period

 

In addition, the Company has granted each non-executive director of the Company options to acquire 200,000 Common Shares, and a non-executive employee has been granted options to acquire 100,000 Common Shares, with all such options bearing the same terms as set out above.

Incentive-Driven Private Placement

The Corporation also announces that it intends to complete a non-brokered private placement of units of the Corporation (each, a “Unit”) at a price of $0.18 per Unit, for gross proceeds of approximately $900,000 (the “Offering”) with key members of Flow’s investment team subscribing for Units. Each Unit is comprised of one common share of the Corporation (each, a “Common Share”) and one Common Share purchase warrant of Flow Capital (a “Warrant”).  Each Warrant entitles the holder thereof to purchase one additional Common Share, at a price of $0.22 per Common Share, for a period of 60 months following the date of issuance of the Warrant. The securities issued under the Offering will be subject to a four-month hold period in accordance with applicable securities legislation.

As a complement to the option grants, this incentive-driven, management-led private placement further increases management’s ownership and alignment with shareholders, while also increasing cash available for new investments.

Completion of the Offering is subject to a number of conditions including, without limitation, receipt of all required regulatory approvals, including the approval of the TSX Venture Exchange.

Change of Auditors

The Corporation confirms that its board of directors has approved the appointment of Goodman & Associates LLP (“Goodman”) as the Corporation’s new independent auditors, replacing PricewaterhouseCoopers LLP (“PWC”).  The appointment of Goodman as the new independent auditors of the Corporation was approved by the shareholders of the Corporation at the shareholders meeting held on May 31, 2018. The decision to change auditors was not the result of any disagreement between the Corporation and PWC or any reportable event within the meaning of applicable securities laws. There were no reservations in PWC’s reports for the two most recently-completed fiscal years or for any period subsequent to the most recently-completed period for which an audit report was issued and preceding the date of change.

In accordance with regulatory requirements, the Corporation has filed a Notice of Change of Auditor (“Notice”) and has received a response letter from PWC, the former auditor, confirming their agreement with the information provided in the Notice. The Corporation has also received a response from Goodman, the successor auditor, confirming their agreement with the information provided in the Notice. The Notice and response letters have been filed on SEDAR.

Management Loan

In connection with renewing his consulting services agreement, Flow Capital has agreed to extend to Robb McLarty a loan of $200,000.

About Flow Capital

Based in Toronto, Flow Capital Corp. is a diversified alternative asset investor and advisor, operating two divisions: an investment operation providing revenue-linked capital to emerging growth businesses, and an institutional advisory sales platform providing pension funds, charities and endowment clients with access to leading institutional money managers from around the world.

For further information, please contact:

Flow Capital Corp.

Robb McLarty
Chief Executive Officer (Acting)
robb@flowcap.com

Phone: (416) 777-0383

1 Adelaide Street East, Suite 3002,

PO Box 171,

Toronto, Ontario M5C 2V9

 

Forward-Looking Information and Statements

This press release contains certain “forward-looking information” within the meaning of applicable Canadian securities legislation and may also contain statements that may constitute “forward-looking statements” within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Such forward-looking information and forward-looking statements are not representative of historical facts or information or current condition, but instead represent only the Company’s beliefs regarding future events, plans or objectives, many of which, by their nature, are inherently uncertain and outside of the Company’s control. Generally, such forward-looking information or forward-looking statements can be identified by the use of forward-looking terminology such as “plans”, “expects” or “does not expect”, “is expected”, “budget”, “scheduled”, “estimates”, “forecasts”, “intends”, “anticipates” or “does not anticipate”, or “believes”, or variations of such words and phrases or may contain statements that certain actions, events or results “may”, “could”, “would”, “might” or “will be taken”, “will continue”, “will occur” or “will be achieved”. The forward-looking information contained herein may include, but is not limited to, information with respect to: the Company’s prospective financial performance, including the Company’s opinion regarding the current and future performance of its portfolio, expenses and operations; anticipated cash needs and need for additional financing; anticipated funding sources; future growth plans; royalty acquisition targets and proposed or completed royalty transactions; estimated operating costs; estimated market drivers and demand; business prospects and strategy; anticipated trends and challenges in the Company’s business and the markets in which it operates; and the Company’s financial position. By identifying such information and statements in this manner, the Company is alerting the reader that such information and statements are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of the Company to be materially different from those expressed or implied by such information and statements.

An investment in securities of the Company is speculative and subject to a number of risks including, without limitation, risks relating to: the need for additional financing; the relative speculative and illiquid nature of an investment in the Company; the volatility of the Company’s share price; the Company’s ability to generate sufficient revenues; the Company’s ability to manage future growth; the limited diversification in the Company’s existing investments; the Company’s ability to negotiate additional royalty purchases from new investee companies; the Company’s dependence on the operations, assets and financial health of its investee companies; the Company’s limited ability to exercise control or direction over investee companies; potential defaults by investee companies and the unsecured nature of the Company’s investments; the Company’s ability to enforce on any default by an investee company; competition with other investment entities; tax matters, including the potential impact of the Foreign Account Tax Compliance Acton the Company; the potential impact of the Company being classified as a Passive Foreign Investment Company (“PFIC“); the Company’s ability to pay dividends in the future and the timing and amount of those dividends; reliance on key personnel, particularly the Company’s founders; dilution of shareholders’ interest through future financings; and general economic and political conditions; as well as the risks discussed in the Company’s and Grenville’s public filings. Although the Company has attempted to identify important factors that could cause actual results to differ materially from those contained in the forward-looking information and forward-looking statements, there may be other factors that cause results not to be as anticipated, estimated or intended.

In connection with the forward-looking information and forward-looking statements contained in this press release, the Company has made certain assumptions. Assumptions about the performance of the Canadian and U.S. economies over the next 24 months and how that will affect the Company’s business and its ability to identify and close new opportunities with new investees are material factors that the Company considered when setting its strategic priorities and objectives, and its outlook for its business.

Key assumptions include, but are not limited to: assumptions that the Canadian and U.S. economies relevant to the Company’s investment focus will remain relatively stable over the next 12 to 24 months; that interest rates will not increase dramatically over the next 12 to 24 months; that the Company’s existing investees will continue to make royalty payments to the Company as and when required; that the businesses of the Company’s investees will not experience material negative results; that the Company will be able to successfully integrate and grow the businesses of its predecessor companies; that the Company will continue to grow its portfolio in a manner similar to what has already been established; that tax rates and tax laws will not change significantly in Canada and the U.S.; that more small to medium private and public companies will continue to require access to alternative sources of capital; that the Company will have the ability to raise required equity and/or debt financing on acceptable terms; and that the Company will have sufficient free cash flow to pay dividends. The Company has also assumed that access to the capital markets will remain relatively stable, that the capital markets will perform with normal levels of volatility and that the Canadian dollar will not have a high amount of volatility relative to the U.S. dollar. In determining expectations for economic growth, the Company primarily considers historical economic data provided by the Canadian and U.S. governments and their agencies. Although the Company believes that the assumptions and factors used in preparing, and the expectations contained in, the forward-looking information and statements are reasonable, undue reliance should not be placed on such information and statements, and no assurance or guarantee can be given that such forward-looking information and statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information and statements.

The forward-looking information and forward-looking statements contained in this press release are made as of the date of this press release, and the Company does not undertake to update any forward-looking information and/or forward-looking statements that are contained or referenced herein, except in accordance with applicable securities laws. All subsequent written and oral forward- looking information and statements attributable to the Company or persons acting on its behalf is expressly qualified in its entirety by this notice.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

June 7, 2018

LOGiQ and Grenville Announce Closing of Arrangement

LOGiQ and Grenville Announce Closing of Arrangement

TORONTO, June 7, 2018 – LOGiQ Asset Management Inc. (“LOGiQ”) (TSX:LGQ) and Grenville Strategic Royalty Corp. (“Grenville”) (TSXV:GRC) are pleased to announce the closing of the previously announced plan of arrangement under the Business Corporations Act (British Columbia) (the “Transaction”). Pursuant to the Transaction, LOGiQ acquired all of the issued and outstanding common shares of Grenville (the “Grenville Shares”) on the basis of 6.25 common shares of LOGiQ (the “LOGiQ Shares”) for each outstanding Grenville Share. In addition, LOGiQ continued from Alberta to British Columbia and changed its name to “Flow Capital Corp.” (“Flow Capital”).

Immediately following completion of the Transaction, Flow Capital effected a share consolidation on a one for twelve basis (the “Share Consolidation”). Following the Share Consolidation, Flow Capital is expected to have approximately 82,678,533 common shares (“Flow Capital Shares”) issued and outstanding. The Flow Capital Shares, Flow Capital 2019 debentures (former Grenville debentures) and Flow Capital 2021 debentures (former LOGiQ debentures) are expected to start trading on the TSX Venture Exchange on June 11, 2018 under the stock symbols “FW”, “FW.DB.A” and “FW.DB.B”, respectively.

Flow Capital has also increased the size of its board of directors (the “Flow Capital Board”) from five to six. The Flow Capital Board is comprised of Eldon Smith, Gordon McMillan, Vernon Lobo, Catherine McLeod-Seltzer, Peter Kampian and Paul De Luca. Robb McLarty, Acting Chief Executive Officer and Chief Investment Officer leads the management team of Flow Capital with Donnacha Rahill as Chief Financial Officer and Steve Mantle as President, LOGiQ Global Partners.

The Transaction, which was announced on March 11, 2018, was approved by Grenville shareholders at Grenville’s special meeting of shareholders held on May 31, 2018 and Grenville obtained a final order in respect thereof from the Supreme Court of British Columbia on June 5, 2018. Holders of LOGiQ Shares approved the issuance of LOGiQ Shares and the Share Consolidation among other things on May 31, 2018.

Flow Capital will mail a letter of transmittal (“Letter of Transmittal”) to the registered former LOGiQ shareholders. The Letter of Transmittal describes the process by which such shareholders may obtain new certificates or DRS Advice(s) representing their post-consolidation Flow Capital Shares. The Letter of Transmittal must be completed and returned to Computershare Investor Services Inc. (“Computershare”) at the address specified in the Letter of Transmittal. Questions on how to complete the Letter of Transmittal, or requests for additional copies of the Letter of Transmittal, may be directed to Computershare at 1-800-564-6253 or by e-mail to corporateactions@computershare.com. A copy of the Letter of Transmittal may also be obtained from the SEDAR website at www.sedar.com.

Non-registered former LOGiQ shareholders holding their Flow Capital Shares through a bank, broker or other nominee should note that such banks, brokers or other nominees may have different procedures for processing the Share Consolidation than those put in place by LOGiQ or Flow Capital for registered shareholders. Non-registered former LOGiQ shareholders are encouraged to contact their nominee to obtain instructions for processing the Share Consolidation.

About Flow Capital
Based in Toronto, Flow Capital Corp. is a diversified alternative asset investor and advisor. Flow Capital operates two businesses: an investment firm providing revenue-linked capital to emerging growth businesses, and an institutional advisory sales platform, providing pension funds, charities and endowment clients with access to leading institutional money managers from around the world.

Cautionary Statement
This news release contains certain “forward-looking statements” within the meaning of such statements under applicable securities law. Forward-looking statements are frequently characterized by words such as “plan”, “continue”, “expect”, “project”, “intend”, “believe”, “anticipate”, “estimate”, “may”, “will”, “potential”, “proposed” and other similar words, or statements that certain events or conditions “may” or “will” occur. These statements are only predictions. Various assumptions were used in drawing the conclusions or making the projections contained in the forward-looking statements throughout this news release. Forward- looking statements are based on the opinions and estimates of management at the date the statements are made, and are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected in the forward- looking statements including: future operating results and funding requirements; the ability to achieve synergies; future general economic and market conditions; and changes in laws and regulations. There can be no assurance that such information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information. Accordingly, readers should not place undue reliance on forward-looking information. Flow Capital does not undertake to update any forward-looking information contained herein, except as required by applicable securities laws.

The TSX has neither approved nor disapproved the information contained in this release. Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Requests for further information should be directed to:

Flow Capital Corp.
Robb McLarty
Acting Chief Executive Officer
robb@flowcap.com
Phone: (416) 777-0383
1 Adelaide Street East, Suite 3002, PO Box 171,
Toronto, Ontario M5C 2V9

June 1, 2018

Grenville Shareholders Approve Plan of Arrangement with LOGiQ

Grenville Shareholders Approve Plan of Arrangement with LOGiQ

TORONTO, Ontario, June 1, 2018 – Grenville Strategic Royalty Corp. (TSXV: GRC) (“Grenville” or the “Company”) today announced the results of its special meeting (the “Special Meeting”) of shareholders held May 31, 2018. At the Special Meeting, Grenville shareholders passed the special resolution, with 97.7% of votes cast in favour, approving the Company’s previously announced arrangement agreement with LOGiQ Asset Management Inc. (“LOGiQ”) outlined in the Joint Management Information Circular dated May 2, 2018 and available on SEDAR.

Under the arrangement LOGiQ will acquire all of the issued and outstanding Grenville common shares and Grenville and LOGiQ will amalgamate. Shareholders of Grenville will receive 6.25 common shares of LOGiQ for each Grenville common share they hold. Upon completion of the arrangement, existing holders of Grenville will own 67% of the combined company and LOGiQ shareholders will own approximately 33%.

Completion of the arrangement, which is expected to occur on or about June 7, 2018, is subject to a number of conditions precedent, including approval from the Supreme Court of British Columbia and satisfaction of other customary closing conditions.

About Grenville

Based in Toronto, Grenville Strategic Royalty Corp. makes growth-oriented investments in established businesses with revenues of up to $50 million. Grenville generates revenues from royalty payments, buyouts from contracts and equity returns. The royalty financing structure offered by Grenville competes directly with traditional equity to meet the long-term financing needs of companies on more attractive commercial terms.

Cautionary Statement

This news release contains certain “forward-looking statements” within the meaning of such statements under applicable securities law. Forward-looking statements are frequently characterized by words such as “plan”, “continue”, “expect”, “project”, “intend”, “believe”, “anticipate”, “estimate”, “may”, “will”, “potential”, “proposed” and other similar words, or statements that certain events or conditions “may” or “will” occur. These statements are only predictions. Various assumptions were used in drawing the conclusions or making the projections contained in the forward-looking statements throughout this news release. Forward-looking statements are based on the opinions and estimates of management at the date the statements are made, and are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected in the forward-looking statements including: future operating results and funding requirements; the ability to achieve synergies; future general economic and market conditions; and changes in laws and regulations. There can be no assurance that such information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information. Accordingly, readers should not place undue reliance on forward-looking information. Grenville does not undertake to update any forward-looking information contained herein, except as required by applicable securities laws. There are a number of conditions precedent to the completion of the arrangement and there can be no assurance that such conditions precedent will be satisfied and that the arrangement will be completed.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

For further information, please contact:

Grenville Strategic Royalty Corp.:

Donnacha Rahill

Chief Financial Officer

Tel: (416) 477-2601

May 4, 2018

Grenville Strategic Royalty Announces 2018 First Quarter Results

Grenville Strategic Royalty Announces 2018 First Quarter Results

– Records Royalty Payment and Interest Income of $1.0 million in Q1 2018 –

TORONTO, Ontario, May 3, 2018 – Grenville Strategic Royalty Corp. (TSXV: GRC) (“Grenville” or the “Company”) today announced its financial and operating results for the three-month period ended March 31, 2018. Financial references are in Canadian dollars unless otherwise specified.

 

2018 First Quarter Financial Highlights

  • Royalty Payment and Interest Income of $1,039,000
  • Realized gain on Contract Buyout of $125,000
  • Revenue of $1,844,000
  • Adjusted EBITDA(1) of $115,000
  • Free Cash Flow(1) of $(133,000)

 

Operational Highlights

Announced Robb McLarty as the new Chief Investment Officer and Acting Chief Executive of Grenville and the resignation of Steve Parry from the Board of Directors

Entered into an arrangement agreement with LOGiQ Asset Management Inc. (“LOGiQ”) for a reverse takeover of LOGiQ. Pending the requisite shareholder approvals, court approvals and closing conditions, Grenville shareholders would hold approximately 67% of the combined company and LOGiQ shareholders 33%

Closed three new investments since January 1, 2018, consisting of $950,000 in Solar Brokers Canada Corp. (“Solar Brokers”), $800,000 in Dionymed Holdings Inc.(“DionyMed”), and US$875,000 in Stability Healthcare Inc. (“Stability”)

Received a Contract Buyout of $250,000, plus royalties earned, on the $125,000 investment in Fixt, bringing the total return to $277,000 for a cash-on-cash return of 2.21 within ten months

Converted a $1 million royalty agreement in WatchIt! to 10 million shares in Inner Spirit at a price of $0.10 per share

Received 80,000 warrants in DionyMed and granted the right to earn up to 399,424 common share purchase warrants in Boardwalktech in relation to consulting services, both of which were subsequent to the end of the period“The transaction with LOGiQ provides us with immediate financial scale that allows us to leverage our existing deal sourcing platform to continue the growth of our portfolio” said Robb McLarty, Acting Chief Executive Officer of Grenville. “The three investments made since the beginning of the year reflect what we seek when sourcing investments. Each company has a strong customer value proposition, is capital efficient, and is led by a proven management team with a significant ownership stake. They are companies of scale and growth, cumulatively representing more than $69 million in run-rate revenue. Looking forward, we will continue to source and close investments in companies like Solar Brokers, DionyMed and Stability.”

Financial Highlights

Canadian dollars Three months ended March 31, 2018 Three months ended March 31, 2017
Revenues

$             1,844,420

$         (3,442,258)

Royalty Payment Income Interest and Fee Income Earned 1,038,506 1,333,641
Adjusted EBITDA(1)                   115,796 157,101
Free Cash Flow(1)                (132,874)                     52,232
(Loss)/Profit for the period                   195,934             (3,792,281)
EBITDA/EBITDA (Loss)(1)                   664,615 (4,638,865)
Basic Earnings/(Loss) per share                     0.0012                  (0.0357)
Diluted Earnings/(Loss) per share                     0.0012                  (0.0357)
Weighted basic average number of shares outstanding  

 

106,317,656

 

           106,297,830
Royalty agreements acquired and promissory notes receivable in period 950,000 98,130
  1. EBITDA, Adjusted EBITDA and Free Cash Flow are non-IFRS measures. Refer to section Definition of Non-IFRS Measures for further explanation and definitions.

 

Revenues

Revenues were $1,844,000 for the three-month period (Q1 2018) ended March 31, 2018, compared to $(3,442,000) for the corresponding period in 2017. Like previous reporting periods, certain non-cash items are recognized in revenue in accordance with IFRS 9.

 

Revenues were positively impacted by the $125,000 realized gain from the buyout of the Fixt investment. Revenues were also positively impacted by net non-cash items of $639,000 in Q1 2018 compared to a negative impact of $4,793,000 for the corresponding period in 2017. The non-cash amount relates to $410,000 of an unrealized gain in writing-up the fair value of royalty agreements acquired and promissory notes receivable and $94,000 of an unrealized foreign exchange gain. These improvements were partially offset by $182,000 for the unrealized loss in the change in the fair value of the shares held in Lattice Biologics Ltd.

 

Royalty Payment Income and Interest and Fee Income Earned

Royalty payment income plus interest and fee income earned were $1,039,000 for Q1 2018, compared to $1,334,000 for the corresponding period in 2017. The change was primarily due to $269,000 of income recognized on the Aquam investment during the three-month period ended March 31, 2017 that was bought-out in April 2017.

 

Management believes that the portfolio will continue to contribute Free Cash Flow(1) on a regular basis as it matures.

 

Operating Expense

Total operating expenses were $1,205,000 in Q1 2018, compared to $1,251,000 for the corresponding period in 2017. The improvement was due to lower salary costs of approximately $72,500 due to two fewer employees, lower rent of $18,500 as a result of moving offices, lower staff training costs of $17,000 and an expense incurred in Q1 2017 of $400,000 related to overclaimed HST input credits. These improvements were partially offset by a $312,500 restructuring cost for the termination of the employment agreement for a managing director of the Company and $136,500 of professional fees incurred for the transaction to combine with LOGiQ.

 

Adjusted EBITDA(1)

Adjusted EBITDA(1) was $116,000 for Q1 2018, compared to $157,000 for the corresponding period in 2017. The variance was due to a number of factors but the insignificant change demonstrates the sustainability of the company’s performance even though royalty payment income, the core revenue item fell by $295,000.

 

Free Cash Flow(1)

Free Cash Flow(1) was $(133,000) for Q1 2018, compared to $52,000 for the corresponding period in 2017. The change was due to $103,000 year-end related audit and professional fees paid and the expenses paid for professional fees relating to the transaction to combine with LOGiQ.

 

Profit (Loss) After Taxes

Profit after taxes was $196,000 for Q1 2018, compared to $(3,792,000) for the corresponding periods in 2017. The improvement was primarily due to $4,154,000 improvement in non-cash items (unrealized foreign exchange gains and losses, unrealized gains and losses from the changes in the fair value of royalty and equity investments and realized loss from investments written-off) between the periods.

 

Outlook

The Company has invested approximately $72 million of capital in 43 portfolio companies, generated Adjusted EBITDA(1) of $20.3 million since inception and generated free cash flow(1) of $12.3 million since July 2014. The core of the portfolio has reached a scale at which it is generating positive Adjusted EBITDA(1) and Free Cash Flow(1). The Company has over time developed and expanded the royalty model to include equity investments as part of its offering. The Company will in select cases where management believes the balance of risk and return warrant it, blend royalties with an equity kicker where management believe it may lead to better returns for the Company and ultimately our shareholders.

 

Grenville’s royalty agreements with its portfolio companies generated Adjusted EBITDA(1) to the Company of approximately $0.1 million for Q1 2017. As of May 3, 2018, the Company estimates that the royalty payment income and interest earned for April 2018 will be $0.37 million. Operating expenses (excluding share-based compensation, restructuring cost, transactions costs for the LOGiQ transaction and depreciation) for Q1 2018 were approximately $0.225 million per month. Operating expenses, excluding a restructuring cost in relation to Steve Parry’s move to an advisory role, are estimated to be in the range of $0.2 million to $0.25 million per month for the three months ending June 30, 2018. The Company’s cash position at May 3, 2018 is approximately $5.1 million.

 

Grenville’s financial statements and management’s discussion and analysis for the three-month period ended March 31, 2018, will be filed today on SEDAR at www.sedar.com and also available on Grenville’s website at www.flowcap.com.

 

(1) Please refer to the Company’s management’s discussion and analysis for definitions and reconciliations of these non-IFRS measures to measures prescribed by IFRS.

 

Conference Call Details

Grenville will host a conference call to discuss these results at 8:00 a.m. Eastern Time, Friday, May 4, 2018. Participants should call (647) 427-2311 or (866) 521-4909 and ask an operator for the Grenville earnings call. Please dial in 10 minutes prior to the call to secure a line. A replay will be available shortly after the call. To access the replay, please dial (416) 621-4642 or (800) 585-8367 and enter access code 7288573. The replay recording will be available until 11:59 p.m. Eastern Time, May 17, 2018.

 

An audio recording of the conference call will be also available on the investors’ page of Grenville’s website at www.flowcap.com.

About Grenville

Based in Toronto, Grenville Strategic Royalty Corp. makes growth-oriented investments in established businesses with revenues of up to $50 million. Grenville generates revenues from royalty payments, buyouts from contracts and equity returns. The royalty financing structure offered by Grenville competes directly with traditional equity to meet the long-term financing needs of companies on more attractive commercial terms.

April 27, 2018

Notice of Grenville Strategic Royalty’s First Quarter 2018 Financial Results Conference Call

Notice of Grenville Strategic Royalty’s First Quarter 2018 Financial Results Conference Call

 – Financial results to be released after markets on Thursday, May 3, 2018 –

TORONTO, Ontario, April 27, 2018 – Grenville Strategic Royalty Corp. (TSXV: GRC) (“Grenville” or the “Company”) today announced it will release its first quarter 2018 financial results after the markets close on Thursday, May 3, 2018. Mr. Robb McLarty, Acting Chief Executive Officer, and Mr. Donnacha Rahill, Chief Financial Officer, will host a conference call at 8:00 a.m. ET the next day, Friday, May 4, 2018, to review the results. A question and answer session will follow the corporate update.

 

CONFERENCE CALL DETAILS

DATE:                                          Friday, May 4, 2018

TIME:                                           8:00 AM Eastern Time

DIAL IN NUMBER:                     866 521-4909 or 647 427-2311

TAPED REPLAY:                         800 585-8367 or 416 621-4642

REFERENCE NUMBER:            7288573

A recording of the call will be archived on the Company’s website at www.flowcap.com/financials/ .

 

About Grenville

Based in Toronto, Grenville is a publicly-traded royalty company that makes investments in established businesses with revenues of up to $50 million dollars. Grenville generates revenues from royalty payments, buyouts from contracts and equity returns. The non-dilutive royalty financing structure offered by Grenville competes directly with traditional equity to meet the long-term financing needs of companies on more attractive commercial terms.

 

For further information, please contact:


Grenville Strategic Royalty Corp.:

Donnacha Rahill

Chief Financial Officer

Tel: (416) 477-2601

April 25, 2018

Notice of meeting and record date (amended)

Notice of meeting and record date (amended)

Date: April 19, 2018

To: All Canadian Securities Regulatory Authorities

Subject: Grenville Strategic Royalty Corp.

Dear Sir/Madam,

We advise of the following with respect to the upcoming Meeting of Security Holders for the subject Issuer:

Meeting Type: Annual General and Special Meeting
Record Date for Notice of Meeting: April 16, 2018
Record Date for Voting (if applicable): April 16, 2018
Beneficial Ownership Determination Date: April 16, 2018
Meeting Date: May 31, 2018 (Amended)
Meeting Location (if available): Toronto, ON
Issuer sending proxy related materials directly to NOBO: Yes
Issuer paying for delivery to OBO: No

 

Notice and Access (NAA) Requirements:
NAA for Beneficial Holders No
NAA for Registered Holders No

 

Voting Security Details:    
Description CUSIP Number ISIN
COMMON SHARES 39773A100 CA39773A1003

 

 

Sincerely,

Computershare

Agent for GRENVILLE STRATEGIC ROYALTY CORP.

April 23, 2018

Grenville Strategic Royalty Announces Management Changes and Expansion of Relationship with Boardwalktech, Inc.

Grenville Strategic Royalty Announces Management Changes and Expansion of Relationship with Boardwalktech, Inc.

TORONTO, Ontario, April 23, 2018 – Grenville Strategic Royalty Corp. (TSXV: GRC) (“Grenville” or the “Company”) today announced changes to its senior management team.

Robb McLarty, currently a Managing Director of the Company, has been promoted to Chief Investment Officer and Acting Chief Executive Officer of the Company. Robb has worked with and invested in emerging growth companies for over twenty years. His venture capital investments have delivered top-quartile returns relative to benchmarks.

Steve Parry will be assuming an advisory role with the Company and will be resigning from the board of directors.

“Steve was a co-founder of the Company and led it through several transitions to bring it to where it is today. He worked tirelessly to find and secure solid investments and consistently added value through his advice and guidance to the investee companies. In addition to advising Grenville, Steve is planning to spend time working directly with some of our existing portfolio companies. We want to thank Steve for his many contributions to the Company”, said Catherine McLeod-Seltzer, Chairman of the Company.

“Robb has demonstrated a keen eye and very good investing discipline in sourcing and closing investments for Grenville. Being based in California enables him to access differentiated US-based companies that strengthen the portfolio. We look forward to Robb continuing to add value in an expanded capacity as Chief Investment Officer”, continued Ms. McLeod-Seltzer.

Boardwalktech, Inc.

Grenville wishes to congratulate Boardwalktech, Inc. (“Boardwalktech”), an investee company of Grenville, on the completion of its subscription receipt financing for aggregate gross proceeds of approximately CDN$10 million and its proposed reverse takeover transaction (the “Boardwalktech RTO”) with Wood Composite Technologies Inc. (“Wood Composite”). For further details regarding these transactions, please see the press releases issued by Wood Composite on April, 2018.

Grenville has been granted the right, in connection with consulting services provided by Grenville to Boardwalktech but subject to the completion of the Boardwalktech RTO, to earn up to 399,424 common share purchase warrants of Boardwalktech at an exercise price of USD$1.67 per share. If granted, these warrants would automatically convert into common share purchase warrants of the resulting issuer upon completion of the Boardwalktech RTO. If the Boardwalktech RTO is not completed, no warrants will be issued to Grenville.

About Grenville

Based in Toronto, Grenville Strategic Royalty Corp. makes growth-oriented investments in established businesses with revenues of up to $50 million. Grenville generates revenues from royalty payments, buyouts from contracts and equity returns. The non-dilutive royalty financing structure offered by Grenville competes directly with traditional equity to meet the long-term financing needs of companies on more attractive commercial terms.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

For further information, please contact:

Grenville Strategic Royalty Corp.

Donnacha Rahill

Chief Financial Officer

Tel: 416-477-2601

April 6, 2018

Notice of meeting and record date

Notice of meeting and record date

 

Date: April 2, 2018

To: All Canadian Securities Regulatory Authorities

 

Subject: Grenville Strategic Royalty Corp.

We advise of the following with respect to the upcoming Meeting of Security Holders for the subject Issuer:

Meeting Type : Annual General and Special Meeting
Record Date for Notice of Meeting : April 16, 2018
Record Date for Voting (if applicable) : April 16, 2018
Beneficial Ownership Determination Date : April 16, 2018
Meeting Date : May 18, 2018
Meeting Location (if available) : Toronto, ON
Issuer sending proxy related materials directly to NOBO: Yes
Issuer paying for delivery to OBO: No

 

Notice and Access (NAA) Requirements:
NAA for Beneficial Holders No
NAA for Registered Holders No

 

Voting Security Details:

 

Description CUSIP Number ISIN
COMMON SHARES 39773A100 CA39773A1003

 

Sincerely,

 

Computershare

510 Burrard St, 3rd Floor Vancouver BC, V6C 3B9

www.computershare.com

Agent for GRENVILLE STRATEGIC ROYALTY CORP.

March 12, 2018

LOGiQ and Grenville to Combine

LOGiQ and Grenville to Combine

TORONTO, March 12, 2018 – LOGiQ Asset Management Inc. (“LOGiQ”) (TSX:LGQ) and Grenville Strategic Royalty Corp. (“Grenville”) (TSXV:GRC) are pleased to announce that they have entered into an arrangement agreement (the “Arrangement Agreement”) pursuant to which LOGiQ has agreed to acquire all of the issued and outstanding common shares of Grenville (the “Grenville Shares”) on the basis of 6.25 common shares of LOGiQ (the “LOGiQ Shares”) for each outstanding Grenville Share (the “Transaction”).

The consideration to be received by Grenville shareholders reflects the relative values of each of LOGiQ and Grenville. Upon completion of the Transaction, existing holders of LOGiQ Shares and Grenville Shares will collectively own approximately 33% and 67% of the combined company, respectively.

LOGiQ and Grenville believe that on a combined basis, the companies together will offer a more effective and viable platform for enhancing shareholder value. “As we explored various options for LOGiQ shareholders, we believe Grenville and its business model, combined with LOGiQ’s institutional Global Advisory Sales platform, offers exciting growth opportunities and the potential to rebuild shareholder value” said Dr. Eldon Smith, LOGiQ’s Chairman. “Grenville’s renewed investment process, strong deal flow pipeline and investment structure are designed to return significant cash on cash yields to investors while participating in the growth of its portfolio companies. This model has been built to provide a win for Grenville’s shareholders and portfolio companies alike. Grenville’s recent success with companies such as Boardwalktech, an emerging enterprise Blockchain company based in California, and its significant equity position in cannabis franchisor Inner Spirit, are indicative of the quality of its deal flow and the upside potential of Grenville’s business model.”

Vernon Lobo, Chair of Grenville’s investment committee added: “We are delighted to be partnering with LOGiQ as we add scale to our business to allow us to take advantage of the compelling investment opportunities ahead of us. Both companies have worked very hard over the past year to address their challenges, and the combination of these businesses will provide us with a solid financial platform from which to build a value-creating business focused on providing alternative sources of financing to high growth companies throughout North America. We are encouraged by recent events in our portfolio, including the contract buyout concluded last week with phone repair company FIXT, and the going public transaction announced by Clear Blue Technologies, one of our earliest investees. We are also looking forward to partnering with Steve Mantle and his team at LOGiQ Global Partners as they continue to grow their business, which generates a consistent and growing revenue stream for the benefit of shareholders. We will be working on board and management configuration over the coming weeks.”

The board of directors of LOGiQ (the “LOGiQ Board”), based on the unanimous recommendation of a special committee of the LOGiQ Board, has unanimously approved the Transaction and recommends that holders of LOGiQ Shares vote in favour of the special resolution approving the continuance of LOGiQ from Alberta into British Columbia (the “Continuance”), which is required to complete the Transaction, and the ordinary resolution approving the issuance of LOGiQ Shares pursuant to the Transaction (the “Share Issuance”).

The board of directors of Grenville (the “Grenville Board”), based on the unanimous recommendation of a special committee of the Grenville Board, has unanimously approved the Transaction and recommends that holders of Grenville Shares vote in favour of the special resolution approving the Transaction.

Transaction Terms

Under the terms of the Arrangement Agreement, the Transaction will be effected by way of a plan of arrangement under the Business Corporations Act (British Columbia) (the “BCBCA”).

The Transaction is subject to shareholder, TSX and Supreme Court of British Columbia approval, and the satisfaction of other customary closing conditions. LOGiQ and Grenville intend to complete the Transaction as soon as possible after all conditions have been met or waived.

The Transaction will require approval by at least 66⅔% of holders of the Grenville Shares represented in person or by proxy at a special meeting of holders of Grenville Shares to be called to consider the Transaction (the “Grenville Meeting”) and, if required, a simple majority of the votes cast by holders of Grenville Shares after excluding the votes cast by those persons whose votes may not be included under the Multilateral Instrument 61-101 Protection of Minority Security Holders in Special Transactions.

The continuance of LOGiQ from Alberta into British Columbia will require approval by at least 66⅔% of holders of the LOGiQ Shares represented in person or by proxy at a special meeting of holders of LOGiQ Shares to be called to consider the Continuance and the Share Issuance (the “LOGiQ Meeting”). The issuance of the LOGiQ Shares pursuant to the Transaction will require approval by holders of a simple majority of LOGiQ Shares represented in person or by proxy at the LOGiQ Meeting, pursuant to the requirements of the TSX. Subject to any required regulatory and shareholder approvals, in connection with the completion of the Transaction, the LOGiQ Shares may be consolidated on a ratio to be determined by the parties.

Further details of the Transaction are set out in the Arrangement Agreement and will also be set out in the joint management information circular to be prepared in connection with the LOGiQ Meeting and the Grenville Meeting, both of which will be filed by LOGiQ and Grenville on SEDAR and will be available on their respective profiles at www.sedar.com.

Voting Support Agreements

All directors and officers of Grenville that are securityholders of Grenville, all directors and officers of LOGiQ that are securityholders of LOGiQ and certain other shareholders of LOGiQ have entered into customary voting support agreements to, among other things, vote in favour of the Transaction.

About LOGiQ

LOGiQ (www.logiqasset.com) provides investment management services to institutional investors through segregated managed accounts and pooled funds, and has an institutional global advisory sales platform providing pension funds, charities and endowment clients with access to leading institutional money managers from around the world. LOGiQ had assets under management or advisement and institutional advisory sales-related fee earning arrangements that are not managed or advised, totaling over $3.4 billion as at December 31, 2017.

About Grenville

Based in Toronto, Grenville Strategic Royalty Corp. is a publicly-traded royalty company that makes investments in established businesses with revenues of up to $50 million dollars. Grenville generates revenues from royalty payments, buyouts from contracts and equity returns. The flexible royalty financing structure offered by Grenville competes directly with traditional equity to meet the long-term financing needs of companies on more attractive commercial terms.

Cautionary Statement

This news release contains certain “forward-looking statements” within the meaning of such statements under applicable securities law. Forward-looking statements are frequently characterized by words such as “plan”, “continue”, “expect”, “project”, “intend”, “believe”, “anticipate”, “estimate”, “may”, “will”, “potential”, “proposed” and other similar words, or statements that certain events or conditions “may” or “will” occur. These statements are only predictions. Various assumptions were used in drawing the conclusions or making the projections contained in the forward-looking statements throughout this news release. Forward-looking statements are based on the opinions and estimates of management at the date the statements are made, and are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected in the forward-looking statements including: future operating results and funding requirements; the ability to achieve synergies; future general economic and market conditions; and changes in laws and regulations. There can be no assurance that such information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information. Accordingly, readers should not place undue reliance on forward-looking information. LOGiQ and Grenville do not undertake to update any forward-looking information contained herein, except as required by applicable securities laws. There are a number of conditions precedent to the completion of the Transaction and there can be no assurance that such conditions precedent will be satisfied and that the Transaction will be completed.

The TSX has neither approved nor disapproved the information contained in this release. Neither 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.

Requests for further information should be directed to:

LOGiQ Asset Management Inc.

Joe Canavan President and Chief Executive Officer jcanavan@logiqasset.com

Mary Anne Palangio Chief Financial Officer mapalangio@logiqasset.com

Phone: (416) 583-2300 180 John Street Toronto, ON M5T 1X5

Grenville Strategic Royalty Corp.

Steven Parry Chief Executive Officer steve@GrenvilleSRC.com

Phone: (416) 777-0383 1 Adelaide Street East, Suite 3002,

PO Box 171,

Toronto, Ontario M5C 2V9