Vancouver, B.C., Canada - TheNewswire – March 29, 2021. Efficacious Elk Capital Corp. ("EECC") (TSXV:EECC.P) is pleased to announce details concerning a proposed arms-length "Qualifying Transaction" involving a business combination with MiMedia Inc. ("MiMedia"), a corporation formed under the laws of the State of Delaware.

 

Overview of MiMedia

 

MiMedia is a private company incorporated in 2012 under the laws of the State of Delaware, USA.

 

Based in New York city, MiMedia has built a next generation consumer cloud platform that enables all types of personal media (photos, videos, music, docs, contacts and SMS) to be secured in the cloud, accessed seamlessly, across all devices (smartphones, tablets, laptops / desktops, web) and on all operating systems (Android, iOS, MAC, PC) at any time.  

 

MiMedia differentiates with its highly visual interface, rich media experience, automatic organization and robust content curation tools, unique private sharing platform for families and deep promotion of content (re)discovery and re-engagement.  16 issued patents, $45M in investment and four years of development supports the Company’s robust, unique and proprietary technology platform and leading consumer experience.  

 

The Company’s platform has millions of highly engaged users around the world today and will now enter its growth phase positioned for an inflection in revenue and cash generation based on current partner deployments and growing partner pipeline.  MiMedia deploys its solution via partnerships with industry-leading smartphone device manufacturers (“OEMs”) and telecom carriers (“Telcos”) globally.  MiMedia provides its partners with high-margin, recurring revenue streams, improved customer retention and immediate market leadership.  

 

Summary of the Proposed Transaction

 

EECC has entered into a non-binding Letter of Intent with MiMedia dated March 26, 2021 (the "LOI") pursuant to which EECC and MiMedia intend to complete a business combination (the "Transaction") to form a company (the "Resulting Issuer") whereby the business of MiMedia will become the business of the Resulting Issuer.

 

Pursuant to the terms of the LOI, immediately prior to the completion of the proposed Transaction, subject to the approval of the shareholders of EECC and MiMedia as applicable, (i) EECC will complete a share consolidation whereby each outstanding EECC common share will be exchanged for 0.52083 of a post consolidation EECC common share (the “Post Consolidation EECC Shares”) for an aggregate of 3,177,083 Post Consolidation EECC Shares; and (ii) MiMedia  will complete a share split whereby each outstanding MiMedia common share will be exchanged for 2.6 post split MiMedia common shares (the “Post Split MiMedia Shares”) for an aggregate of 40,506,329 Post Split MiMedia Shares. Each outstanding stock option, broker warrant and other convertible or exchangeable securities of EECC and MiMedia will be consolidated or split on the same basis, as applicable.

 

Pursuant to the proposed Transaction, (i) every 1 issued and outstanding Post Split MiMedia Share will be exchanged for 1 common share of the Resulting Issuer (the "Resulting Issuer Common Shares") at a deemed price of $0.25 per Resulting Issuer Common Share, for an aggregate of approximately 40,506,329 Resulting Issuer Common Shares; and (ii) each outstanding stock option, broker warrant and other convertible or exchangeable security of MiMedia will be exchanged for a stock option, broker warrant or other convertible or exchangeable security of the Resulting Issuer on an equivalent economic basis.

 

Follow completion of the Proposed Transaction there will be approximately, subject to any shares issued pursuant to the Private Placement (as described below), 43,683,412 issued and outstanding Resulting Issuer Common Shares.

 

It is intended that the Transaction, when completed, will constitute EECC's "Qualifying Transaction" ("QT") in accordance with Policy 2.4 – Capital Pool Companies of the TSX Venture Exchange (the "Exchange") Corporate Finance Policies. A more comprehensive news release will be issued by EECC disclosing details of the Transaction, including financial information respecting MiMedia, the names and backgrounds of all persons who will constitute insiders of the Resulting Issuer, and information respecting sponsorship, once a definitive agreement has been executed and certain conditions have been met, including satisfactory completion of due diligence.

 

Shareholder approval is not required with respect to the Transaction under the rules of the Exchange because the Transaction does not constitute a "Non-Arm's Length Qualifying Transaction" pursuant to the policies of the Exchange. However, the structure of the Transaction is being finalized and based on the final structure as reflected in the definitive agreement, shareholder approval may be required under the incorporating statute of EECC. Trading in the common shares of EECC has been halted and is not expected to resume until the Transaction is completed or until the Exchange receives the requisite documentation to resume trading.

 

It is expected that upon completion of the Transaction, the Resulting Issuer will be renamed to a name acceptable to MiMedia and will be listed as a Tier 2 Technology Issuer on the Exchange.

 

Summary of the Proposed Private Placement

 

Pursuant to the LOI, prior to the closing of the Transaction, MiMedia will complete a brokered private placement (the "Private Placement") of subscription receipts exchangeable into Post Split MiMedia Shares (the "Subscription Receipts") for gross proceeds of a minimum of USD$3,000,000. The Post Split MiMedia Shares issued on the exchange of the Subscription Receipts will be exchanged for Resulting Issuer Common Shares on the same basis as other Post Split MiMedia Shares, as noted above.

 

A more comprehensive news release will be issued by EECC disclosing details of the Private Placement including the names of any Agents engaged and compensation to be paid in respect of completing the Private Placement.

 

Forward Looking Information

Statements in this press release regarding EECC's business which are not historical facts are "forward-looking statements" that involve risks and uncertainties, such as terms and completion of the proposed Transaction. Since forward-looking statements address future events and conditions, by their very nature, they involve inherent risks and uncertainties. Actual results in each case could differ materially from those currently anticipated in such statements.

Completion of the Transaction is subject to a number of conditions, including but not limited to, execution of a binding definitive agreement relating to the Transaction, Exchange acceptance and if applicable pursuant to Exchange 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 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 further information, please contact:

 

David Smalley

Director

Efficacious Elk Capital Corp.

Telephone: (604) 684 4535

Email: david@smalleylawcorp.com

 

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 news release.

Not for distribution to U.S. news wire services or for dissemination in the United States