BOCA RATON, Fla., November 23, 2022 (GLOBE NEWSWIRE) — EasTower Wireless Inc. (“EastTower” or the “company”) (TSXV:ESTW), announces that it has received an additional cash loan from its Founder and CEO, Vlado P. Hreljanovic to help meet current working capital requirements. Mr. Hreljanovic has the.. an additional $67,200 loaned to the Company pursuant to the promissory note with interest at 8% per annum from the date of issue, payable on the due date. The loan and the $90,000 loan previously extended to the Company by Mr. Hreljanovic (announced November 4, 2022) are secured by the receivables of the Company’s indirect wholly owned operating subsidiary and are fully repayable, with no bonus or penalty, at any time by the company.
In addition, the Company intends to complete a series of debt conversions to reduce the Company’s debt and preserve the Company’s cash as working capital.
Four of the Company’s directors (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 $0.01 per share in settlement of accrued and unpaid monthly meeting fees, representing aggregate debt equivalent to US$30,000.
Two 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 $0.01 per share in settlement of a portion of accrued and unpaid salary beginning May 2020 through March 2022 , bringing total debt to $118,429.52.
In addition, the Company intends to enter into a debt conversion transaction with an arm’s length lender, under which the Company will issue 15,971,948 common shares of the Company at an assumed price of $0.01 per share to settle debt of $119,229.24.
The foregoing transactions are subject to the approval of the Company’s directors and regulatory approvals of the TSX Venture Exchange (the “Exchange“). The Shares to be issued pursuant to the novation transactions will be issued pursuant to exemptions from the registration requirements of the United States Securities Act of 1933, as amended (the “US Securities Act’) and applicable state securities laws and are issued as “restricted securities” (as defined in Rule 144 of the US Securities Act). In addition, the shares are subject to a four-month hold period for conversion.
The debt novation transactions with the foregoing officers and directors of the Company each qualify as a “related party transaction” within the meaning of 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 Company’s securities are listed on any regulated exchange. The transactions are each exempt from the minority shareholders’ approval requirements under MI 61-101 at the time of their agreement, neither the fair market value of the transaction nor the fair market value of the consideration for the transaction, provided that the associated prospects each exceeded 25% of the Company’s market capitalization .
While the Company is actively seeking to secure debt or equity financing to meet its working capital needs, there can be no guarantee that any financing(s) will be successfully completed in a timely manner or at all. Further information will be released by the Company as it becomes available.
For more information
Vlado P. Hreljanovic
Phone: (561) 549-9070
Communication contact for shareholders
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 release.
Certain statements in this press release constitute “forward-looking information” as that term is defined under applicable Canadian securities laws. The words “may”, “would”, “could”, “should”, “potential”, “will”, “aim”, “intend”, “plan”, “anticipate”, “believe”, “estimate”. ‘, ‘expect’ and similar expressions relating 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 but not limited to: Obtaining necessary approvals for the transactions ; Completion Conditions for Fulfillment or Waiver of Debt Restructuring; and completion of the debt conversion transactions referred to herein. Many factors could cause the actual results, performance or achievements expressed or implied by such forward-looking information to differ from those described herein should one or more of these risks or uncertainties materialize. Examples of such risk factors include, but are not limited to: credit; market (including stocks, commodities, forex and interest rates); Liquidity; operations (including technology and infrastructure); Reputation; Insurance; strategically; regulatory; legal; Environment; capital endowment; general business and economic conditions in the regions in which the company operates; the Company’s ability to execute 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 to or attacks (including cyberattacks) on the Company’s information technology, Internet, network access or other voice or data communications systems or services; the development of various types of fraud or other criminal behavior to which the Company is subject; the failure of third parties to perform their obligations to the company or its affiliates; the effects of new and changes to or the application of current laws and regulations; dependency on key suppliers; Issuing permits and licenses in a highly regulated business; the overall difficult litigation environment, including in the United States; increased competition; changes in foreign exchange rates; increased funding costs and market volatility due to market illiquidity and competition for funding; the availability of funds and resources to conduct operations; critical accounting estimates and changes in accounting standards, policies and methods used by the company; the occurrence of natural and unnatural catastrophic events and claims arising from such events; and risks related to COVID-19, including various recommendations, orders and actions by government agencies to try to contain the pandemic, including travel restrictions, border closures, non-essential business closures, quarantines, self-isolation, accommodation in physical and social distancing, disruption to the markets, economic activity, financing, supply chains and distribution channels and deterioration in general economic conditions, including a possible national or global recession; and those risk factors discussed or mentioned in the Company’s disclosure documents filed with securities regulatory authorities in certain provinces of Canada and available at www.sedar.com. Should a factor affect the Company in an unexpected way, or should assumptions underlying the forward-looking information prove incorrect, actual results or events may differ materially from the predicted results or events. All such forward-looking information is expressly qualified in its entirety by this cautionary statement. Further, the Company assumes no responsibility for the accuracy or completeness of any such forward-looking information. The forward-looking information contained 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, except as required by law.