January 12 2017 / TheNewswire / Dayton Boot Brands Ltd. (“Dayton”) investors are qualified for up to $1 million in 2016 tax refunds.  Dayton is approved as an Eligible Business Corporation (“EBC”) under the Government of British Columbia Ministry of International Trade Investment Capital Branch’s Investment Tax Credit program.  The program is designed to encourage patient capital to make equity investments in select BC small businesses.  BC residents over the age of 18 can receive a 30% rebate on their investment, which is as good as cash.  The BC government will issue a refund cheque if the investor has no income tax owing.  This is not considered income for subsequent tax years.

To qualify for the EBC tax credit the investment must be considered “at risk” and the BC Small Business Venture Capital Act does not permit Dayton to guarantee the return of capital.  However, all GIC investors have 1st priority rights to participate in the enduring revenue resulting from all Dayton Trademark royalties that will be paid by Dayton itself and all licensees authorized to use the iconic Dayton brand for lifestyle products to include clothing, accessories, etc.

Dayton is able to raise $5 million under the program.  It has raised $1.7 million to date.  Dayton is issuing up to 33 additional GIC’s that are 130% secured by the BC Government’s EBC tax credit and a royalty trust funded by global licensing revenues from the Dayton brand’s trademark (“Dayton Royalty Trust”).

Investment Benefits:

• -Guaranteed Investment Rebate - Capital return is fully secured by the Dayton Royalty Trust’s global trademark revenue stream.

  -Immediate Tax Free Returns - The BC Government pays 30% immediately and lowers the investment’s cost base.  Further income tax credits up to 77% are available using RRSP eligibility. Contributions and credits can be spread over multiple tax years.  Family members can increase total tax benefits using concurrent investments.

  -Convertible to Dayton Common Shares - Conversion rights give exposure to “blue sky” liquidity events such as private equity arrangements of public offerings.  Series C share conversion rights give the ability to “double down” with TFSA tax free capital gains in the event that Dayton grows at projected rates.

Fully diluted as currently structured, the GIC’s will represent approximately 50% of Dayton equity.  Sales and net income projections anticipate significant share value appreciation potentially realized in liquidity events such as private equity investment, acquisitions or public offerings.  Full conversion implies an enterprise valuation of $15 million.  Successful small consumer brands like Dayton are typically valued at 1-2x sales or 10-15x operating income.  Under these formula, Dayton’s projected performance suggests potential valuations of $25-$75 million in 5 years or a share price range of $2.00 - $7.50.

Limited Availability

The BC Government limits individuals’ immediate benefits to 2 GIC’s.  Applications to qualify will be taken on a first come first served basis.  The investment is extremely time sensitive and the tax benefits may end without warning once the Province’s budget has been allocated.  Investments must be made before February 28, 2017 but we are predicting allocations may be unavailable in as little as 2 weeks.  90% of allocations have been made as of the morning of January 9 with 5% of that used in the past week.  Tax credit allocations can be confirmed within hours upon trust account deposit with Dayton’s lawyers; Clark Wilson.

For more information please contact Hall Risk at 604 800-3688 or hrisk@daytonboots.com

This document does not constitute a prospectus or offering for financing, and no guarantees are made or implied with regard to the success of Dayton Boot Brands Ltd. or its business.  Interested parties should seek professional advice with regard to the above discussion.

Only BC Residents are eligible – please consult your financial advisor.