HIRE Technologies Completes Acquisition of Kavin Group and Closes $4 Million Private Placement
Toronto, Ontario–(Newsfile Corp. – December 14, 2020) – HIRE Technologies Inc. (TSXV: HIRE) (“HIRE” or the “Company”), a company focused on modernizing and digitizing human resources as a business, is pleased to announce the following:
- HIRE has completed its previously announced acquisition of Kavin Talent Management & Recruiting (“Kavin Group”)
- The Kavin Group offers staffing services for a wide range of industrial and health care roles in Southern Ontario and other Canadian jurisdictions
- The acquisition expands HIRE’s solution offering and footprint
- HIRE closed its previously announced $1,000,000 and follow-on $3,000,000 non-brokered private placements
“We are pleased to welcome Kavin Group and thereby expand our network’s staffing solutions to include general labour and healthcare. Both service offerings are in high demand and provide HIRE with new opportunities for growth,” said Simon Dealy, CEO. “Not only are we continuing to make great strides in our acquisition strategy, but there has also been overwhelming interest from the investment community to become part of our story. The successful closing of our $4 million financing gives us a solid foundation to execute on our strategy for 2021.”
Kavin Group Acquisition
Kavin Group, a Southwestern Ontario-based employment agency, works with businesses and candidates seeking permanent or contract opportunities. The Kavin Group was recognized by Globe and Mail’s Report on Business as Canada’s 21st out of 400 fastest-growing companies in 2019.
The purchase price was based on five times the business EBITDA for the trailing twelve-month period ending on the second anniversary of the Closing. On Closing, HIRE paid to the Vendors $781,500 in cash and issued 321,543 HIRE common shares at a deemed price of $0.622 per HIRE common share. Included in the agreement is a Vendor Guarantee providing payback amounts to HIRE within four years after closing should the Kavin Group’s financial results not meet prescribed thresholds. For more information about the acquisition of the Kavin Group, please see HIRE’s press release dated November 24, 2020.
HIRE is pleased to announce that it has closed its non-brokered private placement offerings (the “Offerings“), initially announced on November 24, 2020 and December 3, 2020, of units (the “Units“) for aggregate gross proceeds of $4,096,399.20. Each Unit is comprised of one HIRE Common Share and one-half of one common share purchase warrant (a “Unit Warrant“) with each whole Unit Warrant entitling the holder to purchase one HIRE common share at a price of $0.90 for a period of 24 months from the date of issuance.
In consideration for introducing certain subscribers to the Offering, the Company paid finders’ fees (the “Finders’ Fees“) to certain eligible persons (each, a “Finder“). The Finders’ Fees were comprised of: (i) an aggregate of 359,926 non-transferable finders’ warrants (the “Finders’ Warrants“), representing 6.5% of the Units subscribed for by subscribers referred by the Finders; and (ii) a cash payment in the aggregate amount of $215,956, representing 6.5% of the gross proceeds raised from subscribers referred by the Finders. Each Finder Warrant is exercisable for one HIRE common share at a price of $0.60 per HIRE common share for a period of 24 months from the date of issue.
The net proceeds of the Offerings will be used to complete the Company’s acquisition of the Kavin Group with the balance to be used to execute the Company’s business objective of identifying, assessing and executing accretive acquisitions and for general corporate purposes.
An Insider of the Company purchased or acquired direction or control over a total of 42,000 Units as part of the Offering and the Company paid Finder’s Fees to GIC Merchant Bank Corporation (“GICMB“), an entity controlled by a Director of the Corporation, $81,419 and granted 135,698 Finder Warrants as consideration for finding subscribers referred by GICMB (together with the Insider the “Interested Parties“). The placement to the Insider and payment of Finder consideration to GICMB constitutes a “related party transaction” within the meaning of Multilateral Instrument 61-101 Protection of Minority Security Holders in Special Transactions (“MI 61-101“). Notwithstanding the foregoing, the directors of the Company have determined that the Interested Parties’ participation in the Offering and Finders consideration will be exempt from the formal valuation and minority shareholder approval requirements of MI 61-101 in reliance on the exemptions set forth in sections 5.5(a) and 5.7(1)(a) of MI 61-101 on the basis that neither the fair market value (as determined under MI 61-101) of the subject matter of, nor the fair market value of the proceeds of the Offering, insofar as it involves Interested Parties, exceeds 25% of the Company’s market capitalization. The Company did not file a material change report 21 days prior to the closing of the Offering as the details of the participation of Interested Parties had not been confirmed at that time.
The securities offered have not been, and will not be, registered under the U.S. Securities Act of 1933, as amended (the “U.S. Securities Act“) or any U.S. state securities laws, and may not be offered or sold in the United States or to, or for the account or benefit of, United States persons absent registration or any applicable exemption from the registration requirements of the U.S. Securities Act and applicable U.S. state securities laws. This news release shall not constitute an offer to sell or the solicitation of an offer to buy securities in the United States, nor shall there be any sale of these securities in any jurisdiction in which such offer, solicitation or sale would be unlawful.
Keith Schaefer Engagement
HIRE has entered into a content creation and distribution agreement with Keith Schaefer and OGIB Corporate Bulletin Ltd. at a total cash fee of up to $75,000 to be paid upon completion of contract deliverables. Keith Schaefer is the editor and publisher of the OGIB Corporate Bulletin, which provides research to retail investors in small cap industrial, technology and healthcare sectors. Currently, Keith Schaefer has a direct or indirect interest in 200,000 HIRE common shares in the capital of the Company and has a right to acquire an additional 75,000 HIRE common shares.
About HIRE Technologies Inc.
HIRE is building a network of staffing, IT, and HR consulting firms. We help our partners navigate the changing world through growth solutions, focusing on digital transformation. Our partnership model emphasizes preserving the identity and independence of what our partners have built while providing them with the resources and support to take their businesses further.
For further information, please contact:
HIRE Technologies Inc.
Simon Dealy, Chief Executive Officer
Phone: (647) 868-9611
Neither the TSXV 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.
This release includes certain statements and information that may constitute forward-looking information within the meaning of applicable Canadian securities laws. Forward-looking statements relate to future events or future performance and reflect the expectations or beliefs of management of the Company regarding future events. Generally, forward-looking statements and information can be identified by the use of forward-looking terminology such as “intends” or “anticipates”, or variations of such words and phrases or statements that certain actions, events or results “may”, “could”, “should”, “would” or “occur”. This information and these statements, referred to herein as “forward‐looking statements”, are not historical facts, are made as of the date of this news release and include without limitation, statements regarding discussions of future plans, estimates and forecasts and statements as to management’s expectations and intentions with respect to, among other things, receipt of final acceptance from the TSX Venture Exchange with respect to the Offerings and the use of proceeds.
These forward‐looking statements involve numerous risks and uncertainties and actual results might differ materially from results suggested in any forward-looking statements. These risks and uncertainties include, among other things, delays in obtaining or failure to obtain final acceptance from the TSX Venture Exchange with respect to the Offerings.
In making the forward looking statements in this news release, the Company has applied several material assumptions, including without limitation, that the Company will obtain final acceptance from the TSX Venture Exchange with respect to the Offering.
Although management of the Company has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking statements or forward-looking information, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements and forward-looking information.
Such cautionary statements qualify all forward-looking statements made in this press release. HIRE undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law. We seek safe harbor.
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