This news release constitutes a "designated news release" for the purposes of the Company's prospectus supplement dated April 26, 2023 to its short form base shelf prospectus dated November 4, 2021
/NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES /
TORONTO, Sept. 29, 2023 (GLOBE NEWSWIRE) -- Abaxx Technologies Inc. (NEO:ABXX)(OTCQX:ABXXF) (“Abaxx” or the “Company”), a financial software and market infrastructure company, majority shareholder of the Abaxx Commodity Exchange and Clearinghouse (“Abaxx Singapore”), and producer of the SmarterMarkets™ Podcast, summarizes development activities over the past quarter and the general progress of the Company’s business plans. Abaxx also announces that it completed a financing of approximately CAD $1,013,000 through the private placement of an unsecured convertible debenture of the Company with an existing shareholder. Further details of these updates are provided below.
Corporate Milestone Highlights
- Risk and Regulatory: Concluded public consultation on Exchange and Clearinghouse rules; ongoing engagement with the Monetary Authority of Singapore (“MAS”) to complete remaining conditions for final AHC, ACH, and RMO licensing in Q4 2023.
- Commercial: Began a commodity broker engagement program in advance of initial trading, has executed a first cooperation agreement with Vanir Global Markets Pte. Ltd, a global energy and environmental interdealer brokerage (IDB) firm providing market participants further access to Abaxx Exchange's suite of products via their extensive relationships in global energy and environmental markets.
- Exchange Product Development: Submitted a Notification of Impending Listing of Futures Contracts to the MAS for Nickel Sulphate Futures; efforts on carbon and precious metals market solutions continue. Abaxx has also begun initial product scoping for lithium benchmark contracts following constructive engagement with market participants in recent battery metal market events.
- Systems and Operations: Continued integration and certification testing of third-party clearing and exchange independent software vendors (ISVs) in production environments.
- Strategic Financing: The strategic financing process for Abaxx Singapore is progressing, with an expected conclusion in early Q4. Abaxx has signed non-binding term sheets as well as definitive agreements with corporate strategic investors, as previously disclosed on August 14th, 2023.
- Abaxx Console Apps and ID++ Protocol: Advanced design and development work on prototyping of tools for carbon and commodity markets. Held initial pilot project discussions during the quarter with a number of prospective stakeholders, including a global commodity trading firm, voluntary carbon market registry, and a sovereign jurisdiction looking to enhance identity credential technology in financial markets.
Abaxx has made significant progress in its strategic initiatives over the recent months. The Company's efforts have been centered around technological advancements, regulatory engagements, and expanding its market presence, all of which are crucial in addressing global challenges, including the ongoing energy transition and global supply chain investment cycle.
The following press release provides a detailed update on these developments. These actions underscore Abaxx's commitment to delivering long term shareholder value and ensuring the company's growth in a rapidly changing financial and regulatory landscape.
Abaxx Exchange and Clearing Developments
Risk and Regulatory: Since our last update, the Company concluded its public consultation on the rules and procedures of the Exchange and Clearing House. Engagements with the MAS continued regarding any remaining regulatory review and licensing requirements for the Approved Clearing House (ACH), Approved Holding Company (AHC) and Recognised Market Operator (RMO) licenses. These licensing requirements are still subject to final regulatory approval by the MAS.
Commercial: Abaxx has executed an agreement with Vanir Global Markets Pte. Ltd, a global energy and environmental interdealer brokerage (IDB) firm providing market participants further access to Abaxx Exchange's suite of products via their extensive relationships in global energy and environmental markets. The continued utilization of IDBs by global energy, metals and environmental markets will be enhanced by allowing these trades to occur and be submitted to the Abaxx Exchange and Clearinghouse as block trades. This agreement will also facilitate a reciprocation data partnership that will strengthen our price discovery and transparency processes that will benefit all Abaxx Exchange participants.
Abaxx delivered one of only ten presentations at Gastech’s annual LNG conference which attracted over 40,000 global attendees earlier this month. Abaxx’s Chief Commercial Officer Joe Raia was also invited to participate in a closed-door LNG Leadership Roundtable as the only futures exchange representative — consisting of over 20 leaders including participants from Vitol, RWE, Osaka Gas and Petrochina. We also held our 2nd Asia Pacific Petroleum Conference (APPEC) week cocktail reception garnering over 220 attendees from over 50 different companies including OTC Brokers, LNG Trading firms, Bank and Non-Bank futures commission merchants (FCMs).
Systems and Operations: The Company continues integration and certification testing of third-party clearing and exchange ISVs into production environments.
Exchange Product Development: Abaxx Singapore submitted a Notification of Impending Listing of Futures Contracts to the MAS. Abaxx intends to include its first battery metals futures contract on the launch slate with LNG and Carbon contracts. Positive industry response to nickel sulphate futures development has yielded encouraging prospects on additional battery metal solutions. Abaxx continues work on carbon market solutions as the market continues implementing structure around Article 6 requirements. Abaxx is working closely with industry participants to continue implementation of its staged strategy as opportunities to enhance standards emerge. Precious metals solutions remain in Stage 3 of development. The effort in precious metals is broader than futures market development and we look forward to sharing more details at the appropriate time.
Abaxx Console Apps and ID++ Protocol: In Q3 2023, our Digital Product and Engineering Teams advanced development on the project Venice pilot which pairs existing Abaxx Technologies console apps with newly developed tools to create an application suite that connects qualified participants looking to transact in global carbon markets. Engineering teams completed tests designed to validate viability of using ID++ and prototyped tools to create a secure bridge between enterprise cloud and distributed networks.
Abaxx Corporate Update
Debenture Financing: Abaxx Technologies has completed a financing (the “Debenture Financing”) of USD$750,000 (approximately CAD $1,013,000) through the private placement of an unsecured convertible debenture of the Company (the “Debenture”). The proceeds are expected to be used for general corporate and working capital purposes.
The Debenture shall mature on December 15, 2023 (the “Maturity Date”) and is convertible at the option of the holder (the “Conversion Option”) into common shares (the “Common Shares”) of the Company from time to time and at any time at a conversion price of CAD $7.15 per Common Share (the “Conversion Price”). The Debenture shall bear interest at an annual rate of 10%, compounding monthly and payable in cash on the Maturity Date. The Debenture is unsecured, non-voting and carries no right to participate in the earnings of the Company. The Company will also be entitled to prepay the amount owing under the Debenture at any time prior to the Maturity Date without penalty. The securities issued in connection with the Debenture Financing shall be subject to a four-month and one-day hold period following issuance, in accordance with applicable securities legislation.
First Tranche of Strategic Financing: Abaxx Singapore, consistent with its initiative for a US$20 million to US$35 million best efforts equity private placement of preferred shares (the “Preferred Shares”) of Abaxx Singapore (the “Offering”), has formalized an investment agreement with an initial corporate investor. This agreement allows for participation in an offering of 2,144,563 Preferred Shares and Ordinary Shares in the first tranche (the “First Tranche”) of the Offering. The anticipated closure of the Offering has now been revised to October 2023. Notably, the investor for the Preferred Shares in the First Tranche is recognized as a leading global market infrastructure operator.
About Abaxx Technologies
Abaxx is a development-stage financial software and market infrastructure company creating proprietary technological infrastructure for both global commodity exchanges and digital marketplaces. The company’s formative technology increases transaction velocity, data security, and facilitates improved risk management in the majority-owned Abaxx Commodity Exchange (Abaxx Singapore Pte. Ltd.) - a commodity futures exchange seeking final regulatory approvals as a Recognized Market Operator (“RMO”) and Approved Clearing House (“ACH”) with the Monetary Authority of Singapore (“MAS”). Abaxx is a founding shareholder in Base Carbon Inc. and the creator and producer of the SmarterMarkets™ podcast.
For more information please visit abaxx.tech, abaxx.exchange and smartermarkets.media.
For more information about this press release, please contact:
Steve Fray, CFO
Tel: 416-786-4381
Media and investor inquiries:
Abaxx Technologies Inc.
Investor Relations Team
Tel: +1 246 271 0082
E-mail: ir@abaxx.tech
Forward-Looking Statements
This News Release includes certain "forward-looking statements" which do not consist of historical facts. Forward-looking statements include estimates and statements that describe Abaxx or the Company’s future plans, objectives, or goals, including words to the effect that Abaxx expects a stated condition or result to occur. Forward-looking statements may be identified by such terms as “seeking”, “believes”, “anticipates”, “expects”, “estimates”, “may”, “could”, “would”, “will”, or “plan”. Since forward-looking statements are based on assumptions and address future events and conditions, by their very nature they involve inherent risks and uncertainties. Although these statements are based on information currently available to Abaxx, Abaxx does not provide any assurance that actual results will meet management’s expectations. Risks, uncertainties, and other factors involved with forward-looking information could cause actual events, results, performance, prospects, and opportunities to differ materially from those expressed or implied by such forward-looking information. Forward-looking information in this news release includes but is not limited to, Abaxx’s objectives, goals or future plans, the planned use of proceeds from the Debenture Financing, regulatory approval for the Debenture Financing, statements regarding anticipated exchange listings, receipt of regulatory approvals, timing of the commencement of operations, financial predictions, and estimates of market conditions. Such factors include, among others: risks relating to the global economic climate; dilution; the Company’s limited operating history; future capital needs and uncertainty of additional financing; the competitive nature of the industry; currency exchange risks, including risks relating to conversion of Debenture Financing proceeds; the need for Abaxx to manage its planned growth and expansion; the effects of product development and need for continued technology change; protection of proprietary rights; the effect of government regulation and compliance on Abaxx and the industry; the ability to list the Company’s securities on stock exchanges in a timely fashion or at all; network security risks; the ability of Abaxx to maintain properly working systems; reliance on key personnel; global economic and financial market deterioration impeding access to capital or increasing the cost of capital; and volatile securities markets impacting security pricing unrelated to operating performance. In addition, particular factors which could impact future results of the business of Abaxx include but are not limited to: operations in foreign jurisdictions, protection of intellectual property rights, contractual risk, third-party risk; clearinghouse risk, malicious actor risks, third-party software license risk, system failure risk, risk of technological change; dependence of technical infrastructure; and changes in the price of commodities, capital market conditions, restriction on labor and international travel and supply chains. Abaxx has also assumed that no significant events occur outside of Abaxx’s normal course of business.
Abaxx cautions that the foregoing list of material factors is not exhaustive. In addition, although Abaxx has attempted to identify important factors that could cause actual results to differ materially, there may be other factors that cause results not to be as anticipated, estimated, or intended. When relying on Abaxx's forward-looking statements and information to make decisions, investors and others should carefully consider the foregoing factors and other uncertainties and potential events. Abaxx has assumed that the material factors referred to in the previous paragraph will not cause such forward-looking statements and information to differ materially from actual results or events. However, the list of these factors is not exhaustive and is subject to change and there can be no assurance that such assumptions will reflect the actual outcome of such items or factors. The forward-looking information contained in this press release represents the expectations of Abaxx as of the date of this press release and, accordingly, is subject to change after such date. Readers should not place undue importance on forward-looking information and should not rely upon this information as of any other date. Abaxx does not undertake to update this information at any particular time except as required in accordance with applicable laws. Cboe Canada Exchange does not accept responsibility for the adequacy or accuracy of this press release.
