HIVE Blockchain Closes $30 Million Bought Deal Financing, Completes $7 Million Investment by Genesis Mining, and Acquires Second Data Centre
VANCOUVER, Oct. 11, 2017 /CNW/ - HIVE Blockchain Technologies Ltd. (TSX.V:HIVE) (the "Company" or "HIVE") is pleased to announce that it has closed its previously announced bought deal private placement. A total of 20,000,000 common shares (the "Shares") were sold at a price of C$1.50 per Share for aggregate gross proceeds of $30,000,000 (the "Offering"). The Offering was underwritten by a syndicate of underwriters led by GMP Securities L.P. and included Haywood Securities Inc., Eventus Capital Corp, and PI Financial Corp. (collectively, the "Underwriters"). All of the Shares issued under the Offering are subject to a hold period expiring February 12, 2018. In connection with the Offering, the Underwriters received a cash commission equal to 6% of the gross proceeds raised in the Offering. The net proceeds of the Offering are to be used for the purchase of the Second Data Centre (as defined below) and for general working capital purposes.
Concurrently, the Company completed a non-brokered private placement of 4,666,667 common shares at C$1.50 per common share for gross proceeds of $7,000,000 (the "Private Placement") in accordance with the terms of an investor rights agreement between the Company and Genesis Mining Ltd. ("Genesis"), an insider of the Company. The shares issued under the Private Placement are subject to a hold period expiring February 12, 2018. The net proceeds of the Private Placement are expected to be used for general working capital purposes.
Acquisition of Second Data Centre
Concurrently with the completion of the Offering, the Company has completed the purchase of additional cryptocurrency mining equipment located in Reykjanes, Iceland (the "Second Data Centre") from Genesis. Pursuant to a master services agreement between the Company and Genesis (the "MSA"), Genesis is responsible for hosting, maintenance and related services for the Second Data Centre. The Second Data Centre was acquired from Genesis for consideration of C$5,000,000 and the issuance of 2,000,000 common shares of the Company, as well as a revision of the monthly fees payable to Genesis pursuant to the MSA to support the Second Data Centre. The Company's cryptocurrency mining capacity or hashpower is expected to increase by over 70% with the addition of the Second Data Centre. The Company will also pay a success fee of 40,000 common shares in connection with the acquisition.
Stock Option Grant
The Company announces that it has granted an aggregate of 2,000,000 stock options under the Company's stock option plan to consultants and employees of the Company with an exercise price of C$2.00 per stock option, exercisable for a period of ten years from the date of grant, subject to approval of the TSX Venture Exchange (the "Exchange"). The Company has also granted an aggregate of 666,666 stock options to an investor relations provider with an exercise price of C$2.00 per stock option, exercisable for a period of five years from the date of grant, vesting over the period of three years, subject to approval of the Exchange.
About HIVE Blockchain Technologies Ltd.
HIVE Blockchain Technologies Ltd. is a growth oriented, TSX.V-listed company building a bridge from the blockchain sector to traditional capital markets. HIVE is strategically partnered with Genesis Mining Ltd., the world's leading cryptocurrency mining hashrate provider, to build the next generation of blockchain infrastructure. HIVE owns state-of-the-art GPU-based cryptocurrency mining facilities in Iceland, which produce mined cryptocurrency like Ethereum around the clock. HIVE has an option to acquire additional facilities in Iceland or Sweden from Genesis. Genesis supports HIVE with data centre infrastructure know-how and is HIVE's largest shareholder.
For more information and to register to HIVE's mailing list, please visit www.HIVEblockchain.com, which has recently been updated. Follow @HIVEblockchain on Twitter and subscribe to HIVE's YouTube channel.
On Behalf Of HIVE Blockchain Technologies Ltd.
President, CEO and Director
The TSX Venture Exchange has in no way passed upon the merits of the acquisition and has neither approved nor disapproved the contents of this news release. Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the Exchange) accepts responsibility for the adequacy or accuracy of this news release.
Except for the statements of historical fact, this news release contains "forward-looking information" within the meaning of the applicable Canadian securities legislation that is based on expectations, estimates and projections as at the date of this news release. "Forward-looking information" in this news release includes information about the use of proceeds for the Offering and Private Placement; the increase of hashpower as a result of the acquisition of the Second Data Centre; the business goals and objectives of the Company, and other forward-looking information includes but is not limited to information concerning the intentions, plans and future actions of the parties to the transactions described herein and the terms thereon.
Factors that could cause actual results to differ materially from those described in such forward-looking information include, but are not limited to, risks related to the operation of the Second Data Centre; the ongoing partnership with Genesis; hashpower may not increase as currently anticipated; the cryptocurrency market; the Company's ability to successfully mine cryptocurrency; and other related risks as more fully set out in the Filing Statement of the Company dated September 13, 2017.
The forward-looking information in this news release reflects the current expectations, assumptions and/or beliefs of the Company based on information currently available to the Company. In connection with the forward-looking information contained in this news release, the Company has made assumptions about the Company's ongoing partnership with Genesis; historical prices of cryptocurrencies and the ability of the Company to mine cryptocurrencies will be consistent with historical prices; and there will be no regulation or law that will prevent the Company from operating its business. The Company has also assumed that no significant events occur outside of the Company's normal course of business. Although the Company believes that the assumptions inherent in the forward-looking information are reasonable, forward-looking information is not a guarantee of future performance and accordingly undue reliance should not be put on such information due to the inherent uncertainty therein.
Any forward-looking information speaks only as of the date on which it is made and, except as may be required by applicable securities laws, the Company disclaims any intent or obligation to update any forward-looking information, whether as a result of new information, future events or results or otherwise.
SOURCE HIVE Blockchain Technologies Ltd.
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