REG - Seed Innovations Ltd - Loan to Portfolio Company, Leap Gaming

Seed InnovationsAnnouncement

08/06/2022 15:15

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RNS Number : 1993O  Seed Innovations Limited  08 June 2022

Seed Innovations Ltd / AIM: SEED / Sector: Closed End Investments

8 June 2022

SEED Innovations Limited ("SEED" or the "Company")

 

Loan to Portfolio Company, Leap Gaming

 

SEED Innovations Limited, the AIM quoted company investing in fast growing and
industry leading businesses with a focus on the medical cannabis, health and
wellness space  announces that it has provided a Term Loan of up to
€250,000 to portfolio company Fralis LLC, trading as Leap Gaming ('Leap'),
an Israel based B2B developer of high-end 3D gaming applications whose games
are offered by leading online and retail gaming operators worldwide (the 'Term
Loan').

 

The Company and Leap have agreed that the Term Loan will be drawn down in
tranches, with the first tranche of €100,000 drawn down initially. Further
drawdowns of the Term Loan may be drawn in one or more tranches with the
agreement of SEED.

 

The Term Loan will be used for working capital purposes as Leap advances
towards a liquidity event by way of either an initial public offer of its
shares or reverse takeover transaction, anticipated in late 2022.

 

The Term Loan will be payable on completion of certain conditions precedent,
including the payment of a €10,000 arrangement fee by Leap to SEED, which
are expected to be satisfied imminently.

 

Ed McDermott, CEO of SEED, commented: "We are pleased to be able to further
support Leap, one of our long term and largest investments, at a time in which
we believe there is significant progress being made operationally. Following
the milestone award of the content supply license by the UKGC to Leap, and
most recently a license to enter into the Lithuanian market, we anticipate
support for Leap's growth and we will work with the board of Leap towards a
liquidity event over the coming months."

 

Principal Terms of the Term Loan

·    The Term Loan attracts interest of 10% per annum, payable on the 6
April 2023, being the repayment date

·    The Term Loan is repayable as follows:

o on the earlier of 6 April 2023; or

o immediately on the Leap completing any Qualifying Financing (including (i)
in one or more transactions (aggregated over a period of 12 months), raising
equity capital of greater than €1,000,000 from existing or new investors; or
(ii) completing an initial public offer of its shares (including by way of
reverse takeover transaction or similar); or (iii) a sale of any assets of
Leap realising proceeds greater than € 250,000

·    €10,000 arrangement fee payable by Leap to SEED

 

 

 

 

Schedule 4 Disclosure

SEED has a total amount of approximately £4.7 million invested in Leap as
at the last balance sheet date (comprised of circa £633,000 (€733,000) by
way of convertible loan notes and £4.07 million in equity), representing
approximately 43.75% of Leap (on a fully diluted basis).

 

SEED expects to carry its investment in Leap at a value of c.£8.27 million as
at 31 March 2022.

 

About Leap Gaming

 

Leap is a developer of high-end virtual-sports, slots, and casino applications
serving hundreds of gaming brands and generating tens of thousands of
engagement points with end-users. Leap's attention to detail in its solutions
and services is manifested in the modular engagement terms it offers to its
operating partners and its ability to provide seamless experiences across
mobile, desktop and retail environments. Leap is licensed by the MGA and
certified for other jurisdictions worldwide. Unaudited turnover for the year
to 31 December 2021 was €3.1 million, with operating profit of
€615,000.The recent licensing news such as the granting of a content supply
license by the United Kingdom Gaming Commission ("UKGC")] is a significant
milestone for Leap, allowing it to access the lucrative UK gaming market,
which, according to the UKGC, the regulated gambling industry in Great Britain
generated a gross gambling yield ("GGY") of £14.1bn during the period April
2019 to Mar 2021. The UKGC license is added to the other recent licenses
obtained by Leap in Sweden, the Netherlands, Romania, South Africa and Greece.

 

 

 

***ENDS***

 

For further information on the Company please visit  www.seedinnovations.co
(http://www.seedinnovations.co/)   or contact:

 

 

 Ed McDermott       SEED Innovations Ltd        E: info@seedinnovations.co (mailto:info@seedinnovations.co)

 Lance de Jersey
 James Biddle       Beaumont Cornish Limited,   T: (0)20 7628 3396

 Roland Cornish     Nomad
 Isabella Pierre    Shard Capital Partners LLP  T: (0)20 7186 9927

 Damon Heath        Broker
 Catherine Leftley  St Brides Partners Ltd,     E: info@stbridespartners.co.uk (mailto:info@stbridespartners.co.uk)

 Isabelle Morris    Financial PR

 

 

Notes

SEED Innovations is an AIM quoted investment company focused primarily on
disruptive high growth life sciences and technology businesses particularly
within the medical cannabis arena. The Company's strategy is to identify
early-stage opportunities that have an upcoming investment catalyst and grow
its portfolio in terms of value whilst limiting the number of investee
companies to a level where relevant time can be devoted to each.

 

 

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