LX Ventures announced this week that it has reached an agreement to sell part of its stake in Copper Cloud to undisclosed venture capital investors for $700,000 in cash, plus royalties and other considerations. peHUB Canada previously reported LX Ventures’ acquisition of Copper.io in January.
LX Ventures Arranges Capitalization of Copper and Will Focus on Mobio’s Fast Growing Social Media Platform
LX Ventures Inc. (TSX VENTURE:LXV), an acquirer and accelerator of high-growth tech companies, has signed a letter of agreement with venture capital investors to capitalize its portfolio company, Copper Cloud Inc. (“Copper”), as a stand-alone entity.
Under the terms of the agreement, LX Ventures will receive $700,000 in cash payments as well as a 5% royalty on Copper revenues payable according to certain performance criteria. LX Ventures will retain 1 million preferred shares of Copper, redeemable by Copper at $1 per share upon a future monetizing event, including the sale of Copper.
The transaction contemplates an additional $3 million of external funding for Copper which would be used to accelerate Copper’s growth, including the pursuit of a targeted acquisition currently under consideration. LX Ventures retains pro rata participation rights in future financings undertaken by Copper and is relieved of any further obligations to its previous shareholders, including performance-related milestone payments. The closing of the transaction is subject to the completion of a definitive agreement and other customary closing conditions.
“We are pleased with the significant interest from the venture capital community to support the expansion of Copper, enabling us to capture the upside on Copper’s future growth without having to incur further dilution to fund that growth,” commented LX Ventures CEO Mike Edwards. “For LX Ventures, we believe that the best way for us to continue to build shareholder value is to focus our resources on one core business, namely Mobio INsider. With Copper on solid ground to move forward as its own business enterprise, we will now shift our focus to the further development of Mobio, effectively positioning LX Ventures as a single purpose entity.”
“Mobio INsider is on a growth trajectory rarely accomplished by a technology startup and we are pleased that LX Ventures will now focus on building shareholder value by continuing to aggressively scale Mobio,” added Mobio CEO Mark Binns. “LX Ventures’ acquisition and integration of Strutta into Mobio has enabled a fast ramp-up of our brand partnerships. With singular focus by LX Ventures, Mobio will continue to realize its mission to develop the leading social network that pays people based on the content they create and their social influence.”
About LX Ventures
LX Ventures identifies high potential technology companies at revenue and brings together the right mix of talent, experience and resources to rapidly accelerate each company’s growth. Our value-added approach is now being used to focus Mobio INsider on scaling, driving revenue and expanding market share. LX Ventures is publicly traded company on the TSX-V, headquartered in Vancouver, BC. To learn more, visit http://www.lxventures.com.
ON BEHALF OF THE BOARD
LX VENTURES INC.
Mike Edwards, CEO
CAUTIONARY NOTE: FORWARD-LOOKING STATEMENTS. Other than statements of historical fact, all statements included in this news release, including, without limitation, statements regarding future plans and objectives of LX Ventures are forward-looking statements that involve various risks and uncertainties. There can be no assurance that such statements will prove to be accurate, and actual results and future events could differ materially from those anticipated in such statements. Factors that could cause actual results to differ materially from those expected by LX Ventures are those risks described herein and from time to time, in the filings made by LX Ventures with Canadian securities regulators. Those filings can be found on the Internet at: http://www.sedar.com.
Neither the TSX Venture Exchange nor its Regulatory 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: Liolios Group Inc. Scott Liolios or Wojtek Nowak 1-949-574-3860 email@example.com www.lxventures.com
SOURCE: LX Ventures Inc.
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