Helix Enters Into Definitive Agreement With GlobalBlock Limited

Canada Newswire MAY 17, 2021 12:37 PM EDT

Helix Enters Into Definitive Agreement With UK Digital Asset Brokerage Company, GlobalBlock Limited

TORONTO , May 17, 2021 /CNW/ - Helix Applications Inc. (TSXV: HELX) (the " Company " or " Helix ") is pleased to announce that it has entered into a binding definitive share exchange agreement dated May 15, 2021 (the " Definitive Agreement ") with GlobalBlock Limited (" GlobalBlock "), to provide for the completion of a business combination with the Company (the " Transaction "), as more particularly described below. The combined entity (the " Resulting Company ") will continue the business of GlobalBlock, being an established UK based digital asset broker providing trading services via its dedicated digital asset trading platform, its mobile app and on the telephone to individuals and institutions.

Rufus Round , Helix CEO said:

"Helix continues to build momentum in blockchain technology and digital assets. Having successfully signed the definitive agreement with GlobalBlock, we are excited about our future growth. GlobalBlock has a highly experienced team with proven track records of building profitable financial and investment businesses. I look forward to working with them in building a successful business."

David Thomas , Co-Founder of GlobalBlock said:

"Ever since we established GlobalBlock in 2018 we have been serving individuals and businesses with a secure platform to trade cryptocurrencies via our personalized telephone service, digital asset trading platform and mobile app. We believe that we are still at the beginning of the evolution of the digital asset industry. With our already established brokerage business and this business combination with Helix, we are very well placed to capitalize on a rapidly growing sector."

The Transaction is subject to a number of terms and conditions as set forth in the Definitive Agreement, including the approval of the TSX Venture Exchange (the " Exchange "). If complete, the Transaction will constitute a "Fundamental Acquisition" transaction pursuant to Policy 5.3 – Acquisitions and Dispositions of Non-Cash Assets of the Exchange.

About GlobalBlock and its Business

GlobalBlock is a UK based digital asset broker that provides a personalised telephone broking service, dedicated digital asset trading platform and mobile app. Established in 2018 by an experienced team of financial services professionals, GlobalBlock acts as a trusted agent serving the cryptocurrency needs of individuals, corporates, institutional financial firms and intermediaries, providing best execution trading and safe custody of digital assets.

GlobalBlock has obtained temporary registration under the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (MLRs) as a digital asset firm, pending the determination of its formal application by the Financial Conduct Authority in the United Kingdom .

Selected financial information for GlobalBlock is as follows: (i) as at February 28, 2021 , GlobalBlock had assets of £9,893,547 (of which £8,612,498 is comprised of cryptocurrencies held for clients) and liabilities of £9,630,006 (of which £9,467,412 represents amounts due to clients in respect of their trades); and (ii) for the period from March 31, 2020 to February 28, 2021 , GlobalBlock had revenues of £869,550, cost of services and expenses of £416,610 and a profit of £404,024.

The Transaction

Pursuant to the Definitive Agreement, the Company will acquire all of the issued and outstanding securities of GlobalBlock from its four (4) shareholders in exchange for an aggregate of 48,450,000 common shares of Helix at the closing of the Transaction. Upon completion of the Transaction, GlobalBlock will become a wholly-owned subsidiary of Helix. In addition, subject to Exchange approval, the Company will issue 2,550,000 common shares as finders fees. Upon completion of the Transaction, it is expected that the Resulting Company will have 104,648,741 common shares issued and outstanding, approximately 51.27% of which will be held by current Helix shareholders. The aggregate deemed consideration for the Transaction is CAD$55.233 million (based on the price of CAD$1.14 per share, being the last closing price of the common shares of the Company prior to the announcement of the Transaction, and not taking into account the finders fees shares).

The Transaction is conditional upon, among other things:

(i) The confirmation of representations and warranties of each of the Company and GlobalBlock as set out in the Definitive Agreement being true and correct at the closing of the Transaction;

(ii) The absence of any material adverse change in the condition (financial or otherwise), of the assets of each of the parties;

(iii) The parties receiving all requisite regulatory approval, including the approval of the Exchange; and

(iv) The parties obtaining requisite board approvals for the Transaction.

It has been agreed that the 48,450,000 common shares of the Company to be issued to the GlobalBlock shareholders will be deposited into a 24 month escrow, wherein 15% of those shares will be released from escrow six months after closing of the Transaction, and an additional 15% will be released every three months thereafter.

The Transaction is an arm's length transaction, and it is not expected that Helix shareholder approval is required or that the Exchange will impose sponsorship requirements pursuant to the policies of the Exchange.

About the Resulting Company

Management

The Company's current management is anticipated to remain in place as senior management of the Resulting Company, except that David Thomas , who is one of the shareholders of GlobalBlock, is to be appointed as Chief Operating Officer of the Resulting Company upon closing of the Transaction.

At this time, the four shareholders of GlobalBlock, serve as management of GlobalBlock, and will continue to manage and operate GlobalBlock from the United Kingdom . The following is information on each of these individuals:

David Thomas , Director and Co-Founder of GlobalBlock : Before founding London based digital asset broker GlobalBlock, David was a partner at the FCA regulated foreign exchange business GlobalReach Group, where he spent fourteen years and was responsible for the business's corporate and private client relationships, helping grow the business into a leader in the international payments space. In 2018, David co-founded GlobalBlock to serve the growing demands of both retail and institutional investors in trading, clearing, and settling cryptocurrency transactions.

Karl Thompson , Co-Founder of GlobalBlock : Karl has been in financial services for over twenty years, working in the equity trading and brokerage space. In 2012 Karl set up Peregrine & Black Capital, offering bespoke stockbroking services to professional and institutional clients. Karl went on to co-found Peregrine & Black Investment Management in 2015, offering discretionary investment management services to individuals, trusts and charities and later P&B Wealth, a full financial advice firm. The Peregrine & Black Group has offices in London and Bermuda and is correspondingly regulated by the FCA and BMA. Karl co-founded GlobalBlock in 2018 to meet the demands from clients looking to trade in digital assets.
Patrick Bullman , Co-Founder of GlobalBlock : Patrick commenced his career as a broker at Tullett Prebon before moving to BGC Partners in 2009. In 2013 he established Peregrine & Black capital with co-founder Karl Thompson and then set up the firm's investment management arm. In 2018, he established GlobalBlock along with David Thomas and Karl Thompson .
Tim Bullman , Director and Co-Founder of GlobalBlock : Tim Bullman co-founded GlobalBlock in 2018. Prior to that he founded institutional agency broker Mint Partners in 2005 and in his role as CEO guided it from a start up to revenues of over $100 million per annum with offices in London , New York , Paris and Dubai . His previous roles included Head of Sovereign Debt at ICAP, MD Europe at Investor Select Advisors fund of hedge fund group and Senior Managing Director at BGC Partners.

Board of Directors

Current directors of the Company, Rufus Round and Trevor Gabriel , are anticipated to remain in place as directors of the Resulting Company. It is anticipated that Jay Sujir will resign upon closing of the Transaction and be replaced by Stuart Olley . In addition, David Thomas will be added as a director of the Resulting Company.

Stuart Olley : Stuart is a senior partner with the law firm Gowling WLG ( Canada ) LLP practicing in the Capital Markets, M&A and Private Equity groups in Calgary . Stuart is a past member of the Securities Advisory Council of the Alberta Securities Commission. He holds a master's degree in law from Osgoode Hall Law School at York University (securities speciality), a LLB and MBA from the University of Alberta , and a Bachelor of Arts in Economics from the University of Toronto . Stuart has been consistently identified by Canadian Legal Lexpert directory as a leading Canadian lawyer in the corporate mid market sector and by Best Lawyers as one of Canada's leading lawyers in Securities Law and Mining Law. Stuart has advised and served on the board of directors of various public companies and has extensive experience in corporate governance, public company finance and mergers and acquisitions.

New Shareholder Insiders

Upon closing of the Transaction, it is expected that each of David Thomas , Tim Bullman , Karl Thompson and Patrick Bullman will hold 12,112,500 common shares of the Resulting Company, each of which represent approximately 11.57% of the outstanding common shares of the Resulting Company.

Proposed Name Change

The Company will this week issue a notice of meeting to hold a shareholder meeting, wherein shareholders of the Company will be asked to approve a name change for Helix to "GlobalBlock Digital Ltd.", or such other name as the parties may reasonably agree upon.

Trading Halt

Trading in the common shares of the Company are currently halted. While there is no certainty that the common shares of the Company will resume trading until the Transaction is completed and approved by the Exchange, the Exchange may allow trading to resume after it has reviewed initial filings by the Company with respect to the Transaction.

Other Information

The Company has provided a £750,000 loan facility to GlobalBlock. Please see the Company's April 12, 2021 press release for additional information.

The Company will issue additional press releases related to lifting of the trading halt, the completion of the Transaction and other material information as it becomes available.