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MISSISSAUGA, ON, Sept. 13, 2019 /CNW/ - Axis Auto Finance
Inc. ("Axis" or the "Company") (TSXV: AXIS) is
pleased to announce it has completed its previously announced
private placement financing of convertible unsecured subordinated
debentures ("Debentures") with Westlake Financial Services
("Westlake") and Nowcom Corporation ("Nowcom").
Pursuant to the financing, Axis issued an aggregate of US$2,000,000 (C$2,640,000) principal amount of Debentures,
with an additional US$3,000,000
available for future draw at Axis' option on an as-needed basis. In
connection with the issuance of the Debentures the Company also
issued an aggregate of 5,866,666 common share purchase warrants
("Warrants"), which only become exercisable following an Exercise
Notice, as defined herein. The Company will use the net proceeds
from the issuance of Debentures for working capital purposes.
The Debentures have a maturity date of June 30, 2023 (the "Maturity Date") and carry an
interest rate of 7.5% per annum. Each Debenture will be convertible
at the option of the holder at any time prior to the Maturity Date,
or if called for redemption, the last Business Day preceding the
date specified by the Company for redemption, at a conversion price
of $0.45 per share (the "Conversion
Price"). The Debentures may be redeemed by the Company on and after
June 30, 2022 and prior to the
Maturity Date at a price equal to the outstanding principal amount
and accrued and unpaid interest provided that the volume weighted
average trading price of the Company's common shares for the 20
consecutive trading days preceding the date on which the notice of
redemption is given is not less than $0.5625. In certain circumstances, if the
Company intends to issue additional debt that ranks equal or senior
to the Debentures where the Company's total net debt (being total
debt less cash and cash reserves) as a percentage of gross finance
receivables exceeds 95% as a result of such further issuance of
debt (the "95% Condition") it must first provide the holders of
Debentures with prior written notice of such issuance and request
their approval for such issuance. In the event the holders of the
Debentures do not provide such approval and the Company proceeds
with such issuance and the Company remains in breach of the 95%
Condition 60 days following such issuance, it is required to
provide notice thereof to the holders of the Debentures and the
holders of the Debentures shall have 10 business days to provide a
written notice to the Company (the "Exercise Notice") that the
holder will require that the Company repay the outstanding
Debentures and accrued and unpaid interest thereon in cash. Each
Warrant entitles the holder to purchase one common share in the
capital of the Company (a "Warrant Share") at a price $0.45, at any time and from time to time
following the delivery of an Exercise Notice up to 5:00 p.m. (Toronto time) on the Maturity Date. The
Warrants will expire in the event that the Debentures are converted
in accordance with their terms. The number of Warrants that will
expire will be proportional to the principal amount of Debentures
converted out of the total number of Debentures issued.
Further details regarding the terms of the Debentures will be
available under the Company's profile on www.sedar.com.
INFOR Financial Inc. acted as the exclusive financial advisor to
Axis in connection with the private placement and in such capacity
received a 4.5% cash fee and 234,666 compensation warrants
("Compensation Warrants"). Each Compensation Warrant
entitles the holder to acquire one common share of the Company at
any time on or before September 13,
2021 at an exercise price of $0.45.
About Westlake Technology Holdings
Westlake Technology Holdings is an auto and finance technology
company headquartered in Los Angeles,
CA with approximately US$9.8
billion in assets under management. Westlake Financial
Services originates indirect automotive retail installment
contracts through a nationwide network of new and used automotive
and powersports dealers. Westlake also offers loan portfolio
purchasing, credit facilities and portfolio servicing through their
ALPS division (Advanced Lending & Portfolio Services);
www.WestlakeALPS.com. Floor plan lines of credit are provided
through their Westlake Flooring Services division,
www.WestlakeFlooringServices.com, shared cash flow auto lending
through Westlake's wholly owned subsidiary, Western Funding Inc., a
Nevada based auto lender, and
indirect automotive leasing for credit unions through Westlake
subsidiary, Credit Union Leasing of America (CULA). Dealer leads
and direct-to-consumer auto loans are offered through Westlake
Direct. Consumer title loans are offered through Westlake's wholly
owned subsidiary Loan Center, www.loancenter.com.
About Nowcom
Nowcom Corporation is a technology company developing technology
solutions for the automotive and financial services verticals.
Nowcom is one of seven companies within The Hankey Group
(US$10 billion in assets) and based
in Los Angeles, CA. Nowcom not
only provides technology for all the Hankey group of companies
including Westlake but also provides industry leading software to
auto dealerships through its flagship product DealerCenter (Dealer
Management System) and patented IMaxx technology. Nowcom also
developed first-of-its-kind, fully automated finance decision
websites like Carzing.com and powers up dealers' websites in the
country with the same finance engine like BuyMcar.com. Nowcom has
vast experience and the right resources to bring products from
ideation to market quickly and efficiently.
About Axis Auto Finance
Axis Auto Finance is a leading Canadian provider of alternative
used vehicle financing options servicing roughly 30% of Canadians
(Source: Equifax) that have credit scores in the non-prime range.
100% of all Axis auto loans report to the credit bureau, resulting
in a significant improvement of the credit scores for the
overwhelming majority of clients. These clients use Axis as a
stepping stone in their credit rebuilding journey and we are proud
to be improving the lives of these Canadians. Supported by
state-of-the-art, in-house developed risk analytics, Axis continues
to be Canada's fastest-growing
publicly traded auto-financing company. Further information on the
Company can be found at investors.axisautofinance.ca.
Forward-Looking Statements
This news release includes forward-looking information and
statements, which may include, but are not limited to, information
and statements regarding or inferring the future business,
operations, financial performance, prospects, and other plans,
intentions, expectations, estimates, and beliefs of the Company.
Information and statements which are not purely historical fact are
forward-looking statements. The forward-looking statements in this
press release relate to comments that include, but are not limited
to, the use of proceeds from the financing and the completion of
future financings. Forward-looking information and statements
involve and are subject to assumptions and known and unknown risks,
uncertainties, and other factors which may cause actual events,
results, performance, or achievements of the Company to be
materially different from future events, results, performance, and
achievements expressed or implied by forward-looking information
and statements herein. Although the Company believes that any
forward-looking information and statements herein are reasonable,
in light of the use of assumptions and the significant risks and
uncertainties inherent in such information and statements, there
can be no assurance that any such forward-looking information and
statements will prove to be accurate, and accordingly readers are
advised to rely on their own evaluation of such risks and
uncertainties and should not place undue reliance upon such
forward-looking information and statements. Any forward-looking
information and statements herein are made as of the date hereof,
and except as required by applicable laws, the Company assumes no
obligation and disclaims any intention to update or revise any
forward-looking information and statements herein or to update the
reasons that actual events or results could or do differ from those
projected in any forward-looking information and statements herein,
whether as a result of new information, future events or results,
or otherwise, except as required by applicable laws.
The TSX Venture Exchange has neither approved nor disapproved
the contents of this press release. Neither the Exchange nor its
Regulation Services Provider (as that term is defined in the
policies of the Exchange) accepts responsibility for the adequacy
or accuracy of this release.
SOURCE Axis Auto Finance Inc.