공고 • Aug 12
FansUnite Entertainment Inc. (CNSX:FANS) completed the acquisition of Askott Entertainment Inc.
FansUnite Entertainment Inc. (CNSX:FANS) signed a definitive amalgamation agreement to acquire Askott Entertainment Inc. for CAD 30.6 million on June 22, 2020. As part of the consideration, Askott shareholders will receive approximately 1.9193 common shares of FansUnite for each Askott common share held at closing ("Exchange Ratio"). FansUnite will issue an aggregate of approximately 71,171,212 FansUnite shares to the Askott shareholders. Holders of the currently outstanding 125,000 common share purchase warrants of Askott will be entitled to purchase an aggregate of up to 239,912 FansUnite shares at an exercise price of approximately CAD 0.26 per FansUnite share and the holders of the currently outstanding 1,820,000 stock options of Askott will be entitled to purchase an aggregate of up to 3,493,125 FansUnite shares at exercise prices ranging from approximately CAD 0.26 to CAD 0.32 per FansUnite share. In addition, FansUnite may issue up to 2,582,072 FansUnite shares in exchange for Askott shares, at the Exchange Ratio, if certain Askott warrants are exercised, and don't otherwise expire, prior to the completion of the Transaction. Upon completion of the Transaction, FansUnite expects to have approximately 138,161,092 FansUnite shares issued and outstanding, of which the former holders of Askott will hold approximately 50% on a non-diluted and on a fully diluted basis. Prior to closing of the Transaction, Askott is expected to undertake a private placement of subscription receipts (the "Subscription Receipts") for up to CAD 5 million (or such other amount as FansUnite and Askott agree to in the context of the market) at an issue price per unit to be agreed upon by Askott and FansUnite. Each subscription receipt will entitle the holder to receive, automatically and with no further action on the part of the holder upon the satisfaction of certain conditions including closing of the transaction, one unit of Askott (each a "Unit"), with each such Unit consisting of: (i) one FansUnite share; and (ii) one FansUnite common share purchase warrant exercisable into one FansUnite Share with an exercise price to be determined by Askott and FansUnite, exercisable for a period of up to 24 months from the closing date, with an exercise price to be determined in accordance with the market and the policies of the CSE and subject to adjustments in certain customary circumstances. As a result, the number of FansUnite shares to be issued to Askott shareholders will increase based on the amount of the Askott private placement. The agreement provides for, among other things, customary representations, warranties and covenants including reciprocal non-solicitation and rights to match superior proposals, as well as a reciprocal $800,000 termination fee payable to either Askott or FansUnite under certain circumstances.
Upon closing of the transaction, the Board of Directors of FansUnite will continue to be composed of five members. It is anticipated that two of the current members will be replaced with Scott Burton, founder and CEO Askott, and another director to be nominated by Askott and a third member will be mutually agreeable to Askott and FansUnite. Scott Burton, Chief Executive Officer of Askott, will become the Chief Executive Officer of FansUnite and Darius Eghdami will become the President of FansUnite. Jeremy Hutchings, the Chief Technology Officer of Askott, will become the Chief Technology Officer of FansUnite, Ian Winter, the Chief Operating Officer of Askott, will become the Chief Operating Officer of FansUnite and management of FansUnite will otherwise remain the same.
Completion of the transaction is subject to certain conditions, including receipt of all regulatory approvals, the completion of the Askott Subscription Receipt Financing and the approval of at least two-thirds of the votes cast by holders of Askott shares at a special meeting of Askott shareholders to be called for the purpose of approving the transaction. Askott shall not have received notices of dissent with respect to the Amalgamation from Askott Shareholders who collectively hold more than 5% of Askott Common Shares, excluding Askott Common Shares held by Dissenting Shareholder that fails to perfect or effectively withdraw such Dissenting Shareholder’s claim in accordance with the BCBCA or otherwise waives its right to make a claim in accordance with the BCBCA prior to the Effective Date. The Board of Directors of FansUnite and Askott have both unanimously approved the transaction and the Board of Directors of Askott has concluded that the transaction is in the best interests of its shareholders and has resolved to recommend that Askott shareholders vote their shares in favour of the transaction. All of the directors and officers of Askott have agreed to vote their Askott Shares in favour of the transaction. The transaction is expected to close in the third quarter of 2020. Haywood Securities Inc. has acted as exclusive financial advisor to Askott and Gowling WLG (Canada) LLP is acting as legal advisor to Askott. Fasken Martineau DuMoulin LLP is acting as legal counsel to FansUnite. Haywood would receive the payment of advisory fees equal to 1.125% of the value of the sale of Askott, in the form of FansUnite shares.
FansUnite Entertainment Inc. (CNSX:FANS) completed the acquisition of Askott Entertainment Inc. on August 11, 2020