BOCA RATON, Fla., Nov. 23, 2022 (GLOBE NEWSWIRE) -- EasTower Wireless Inc. (“EasTower” or the “Company”) (TSXV:ESTW), announces that it has received an additional cash loan from its founder and CEO, Vlado P. Hreljanovic, to assist with meeting current working capital requirements. Mr. Hreljanovic has loaned an additional US$67,200 to the Company pursuant to a demand promissory note bearing interest at 8% per annum from the date of issue, payable on maturity. The loan, and the US$90,000 loan previously provided by Mr. Hreljanovic to the Company (announced on November 4, 2022), is secured by the accounts receivables of the Company’s indirect wholly owned operating subsidiary and is fully redeemable, without bonus or penalty, at any time by the Company.
In addition, the Company intends to complete a series of debt conversions to decrease the Company’s debt and preserve the Company’s cash for working capital.
- Four directors of the Company (Ted Boyle, Joel Liebman, Fred Buzzelli and Margaret Perialas) have agreed to accept an aggregate of 4,018,800 common shares of the Company at a deemed price of CAD$0.01 per share in satisfaction of accrued and unpaid monthly director sitting fees, representing an aggregate of US$30,000 of indebtedness.
- Two senior officers of the Company (Mr. Hreljanovic and Ms. Perialas) have agreed to accept an aggregate of 15,864,817 common shares of the Company at a deemed price of CAD$0.01 per share in satisfaction of a portion of accrued and unpaid salary from May 2020 to March 2022, representing an aggregate of US$118,429.52 of indebtedness.
- In addition, the Company intends to complete a debt conversion transaction with an arm’s length lender, pursuant to which the Company will issue 15,971,948 common shares of the Company at a deemed price of $0.01 per share in satisfaction of US$119,229.24 of indebtedness.
The foregoing transactions are subject to approval of the directors of the Company and regulatory approval from the TSX Venture Exchange (the “Exchange”). The shares issuable pursuant to the debt conversion transactions will be issued in reliance on exemptions from the registration requirements of the United States Securities Act of 1933, as amended (the “U.S. Securities Act”), and applicable state securities laws, and will be issued as “restricted securities” (as defined in Rule 144 under the U.S. Securities Act). In addition, the shares will be subject to an Exchange four-month hold period.
The debt conversion transactions with the foregoing senior officers and directors of the Company are each considered a “related party transaction” as defined under Multilateral Instrument 61-101 (“MI 61-101”). The transactions are each exempt from the formal valuation approval requirements of MI 61-101 as none of the securities of the Company are listed on a prescribed stock exchange. The transactions are each exempt from the minority shareholder approval requirements of MI 61-101 as at the time they were agreed to, neither the fair market value of the transaction, nor the fair market value of the consideration for the transaction, insofar as they involve interested parties, exceeded 25% of the Company’s market capitalization, respectively.
While the Company is actively trying to secure debt or equity financing to assist it in meeting its working capital requirements, there can be no assurance that one or more financings will result, or successfully conclude in a timely manner or at all. Additional information will be released by the Company as it occurs.
For further information
Vlado P. Hreljanovic
Chief Executive Officer
Ph: (561) 549-9070
Email: wireless@eastower.com
Shareholder Communications Contact
Email: investor@eastowerwireless.com
Neither the 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 press release.
Forward-Looking Information
Certain statements contained in this press release constitute “forward-looking information” as such term is defined in applicable Canadian securities legislation. The words “may”, “would”, “could”, “should”, “potential”, “will”, “seek”, “intend”, “plan”, “anticipate”, “believe”, “estimate”, “expect” and similar expressions as they relate to the Company, are intended to identify forward-looking information. All statements other than statements of historical fact may be forward-looking information. Such statements reflect the Company’s current views and intentions with respect to future events, and current information available to the Company, and are subject to certain risks, uncertainties and assumptions, including, without limitation: receipt of necessary approvals for the transactions; closing conditions for the debt conversions being satisfied or waived; and closing of the debt conversion transactions noted herein. Many factors could cause the actual results, performance or achievements that may be expressed or implied by such forward-looking information to vary from those described herein should one or more of these risks or uncertainties materialize. Examples of such risk factors include, without limitation: credit; market (including equity, commodity, foreign exchange and interest rate); liquidity; operational (including technology and infrastructure); reputational; insurance; strategic; regulatory; legal; environmental; capital adequacy; the general business and economic conditions in the regions in which the Company operates; the ability of the Company to execute on key priorities, including business retention, and strategic plans and to attract, develop and retain key executives; the ability to implement business strategies and pursue business opportunities; low profit market segments; disruptions in or attacks (including cyber-attacks) on the Company’s information technology, internet, network access or other voice or data communications systems or services; the evolution of various types of fraud or other criminal behavior to which the Company is exposed; the failure of third parties to comply with their obligations to the Company or its affiliates; the impact of new and changes to, or application of, current laws and regulations; dependence on key suppliers; granting of permits and licenses in a highly regulated business; the overall difficult litigation environment, including in the U.S.; increased competition; changes in foreign currency rates; increased funding costs and market volatility due to market illiquidity and competition for funding; the availability of funds and resources to pursue operations; critical accounting estimates and changes to accounting standards, policies, and methods used by the Company; the occurrence of natural and unnatural catastrophic events and claims resulting from such events; and risks related to COVID-19 including various recommendations, orders and measures of governmental authorities to try to limit the pandemic, including travel restrictions, border closures, non-essential business closures, quarantines, self-isolations, shelters-in-place and social distancing, disruptions to markets, economic activity, financing, supply chains and sales channels, and a deterioration of general economic conditions including a possible national or global recession; as well as those risk factors discussed or referred to in the Company’s disclosure documents filed with the securities regulatory authorities in certain provinces of Canada and available at www.sedar.com. Should any factor affect the Company in an unexpected manner, or should assumptions underlying the forward-looking information prove incorrect, the actual results or events may differ materially from the results or events predicted. Any such forward-looking information is expressly qualified in its entirety by this cautionary statement. Moreover, the Company does not assume responsibility for the accuracy or completeness of such forward-looking information. The forward-looking information included in this press release is made as of the date of this press release and the Company undertakes no obligation to publicly update or revise any forward-looking information, other than as required by applicable law.
