VANCOUVER, British Columbia (November 30, 2020) – PowerBand Solutions Inc. (TSXV:PBX) (OTCQB:PWWBF) (Frankfurt:1ZVA) (“PowerBand“, “PBX” or the “Company“) is pleased to announce that upon receiving final acceptance from the TSX Venture Exchange, it has executed a Common Voting Stock Purchase Agreement (the “Agreement“) to acquire up to 15% of CB Auto Group, Inc.’s (“CB Auto“) issued and outstanding common shares (the “Shares“) for aggregate consideration of USD $5,000,000. On November 27, 2020, the Company paid USD $500,000 in cash, (less a previously paid USD $50,000 deposit) to acquire an initial 10% of the Shares of CB Auto. The November 27, 2020 closing is the first of four tranches. On the closing of the second tranche, scheduled for December 31, 2020, the Company will pay USD $1.5 million for 30% of the Shares of CB Auto. On March 31, 2021, the Company will close on the third tranche and pay USD $1.5 million for an additional 30% of the Shares of CB Auto. The fourth tranche will close on June 30, 2021, with the Company making a final payment of USD $1.5 million for a further 30% of the Shares of CB Auto. In addition to the initial cash payment of USD $500,000, the Company has issued a total of 750,000 PowerBand share purchase warrants (the “Warrants“) to CB Auto. The Warrants have an exercise price of $0.30 and a three-year maturity period. 10% of the Warrants were exercisable on November 27, 2020. 30% will be exercisable on December 31, 2020, a further 30% on March 31, 2021, and the final 30% of the Warrants will be exercisable on June 30, 2021. The common shares of the Company issued upon the exercise of the Warrants will be subject to a four-month and one-day hold. As part of the Agreement the Company has been granted an option (the “Option“) to purchase up to an additional 15% of the issued and outstanding Common Stock of CB Auto, for a period of 18 months following the November 27, 2020 closing, at a USD $40,000,000 valuation of CB Auto immediately preceding the exercise of the Option.
Under the Agreement, CB Auto’s membership – consisting of more than 67 million people – will be directed to DRIVRZTM when they are looking to acquire new or used vehicles. Additionally, PowerBand will be able to market DRIVRZTM, along with associated services and products, exclusively to that membership.
“I’m delighted that millions of U.S. consumers will soon have access to DRIVRZTM, to buy, lease, sell, trade and finance their cars and trucks on a smart phone as easily as buying a product on Amazon,” said PowerBand CEO Kelly Jennings. “We expect to be fully integrating CB Auto’s powerful member databases into DRIVRZTM in the very near future.”
PowerBand has created DRIVRZTM to enable drivers and automotive dealers to use a smart phone, tablet or other connected device to buy, sell, lease, trade and finance vehicles from any location. Using DRIVRZTM, consumers and auto dealers will also have access to more than 4.5 million new and used vehicles, financing and insurance products, a one-stop virtual hub for automotive retail.
Founded in 2016, CB Auto Group provides union members and their families access to the Union Auto Program, which offers car-buying services, free benefits, fair pricing and protective products, all designed to provide transparency and confidence when they purchase or lease a new or used vehicle.
CB Auto has access to more than 43 million union members and their families in its customer base. There are also more than 24 million “affinity” members from other associations, such as the alumni of Georgia Tech, the University of Tennessee, ADP, Nike and many others, bringing CB Auto’s total consumer base to more than 67 million.
Based on NADA data, union members alone are presently buying over 3.4 million vehicles from franchise dealers nationwide.
CB Auto augmented its automotive program in 2020 by launching the CB Absolute Advantage, which the company describes as “a member benefits program that provides medium to large businesses, alumni groups, affinity groups, and more, with this concierge car-buying service, along with additional savings and benefit options unlike anything in the automotive industry.” DRIVRZTM will now be offered in that program.
About PowerBand Solutions Inc.
PowerBand Solutions Inc., listed on the TSX Venture Exchange and the OTCQB markets, is a fintech provider disrupting the automotive industry. PowerBand’s integrated, cloud-based transaction platform facilitates transactions amongst consumers, dealers, funders and manufacturers (OEMs). It enables them to buy, sell, trade, finance, and lease new and used, electric- and non-electric vehicles, on smart phones or any other online digital devices, from any location. PowerBand’s transaction platform – being trademarked under DRIVRZTM – is being made available across North American and global markets.
The completion of the transactions described herein are subject to the negotiating and entering into of definitive legal documentation, and the satisfaction of conditions precedent. There can be no guarantees that the acquisition will be completed.
Neither the TSXV nor its Regulation Services Provider (as that term is defined in the policies of the TSXV) accepts responsibility for the adequacy or accuracy of this news release.
For further information, please contact:
Richard Goldman, VP Corporate Development
This news release contains forward-looking statements relating to the Company and other statements that are not historical facts. Forward-looking statements are often identified by terms such as “will”, “may”, “should”, “anticipate”, “expects” and similar expressions. All statements other than statements of historical fact, included in this release, including, without limitation, statements regarding future plans and objectives of the Company, are forward looking statements that involve risks and uncertainties. There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements.
The reader is cautioned that assumptions used in the preparation of any forward-looking information may prove to be incorrect. Events or circumstances may cause actual results to differ materially from those predicted, as a result of numerous known and unknown risks, uncertainties, and other factors, many of which are beyond the control of the Company. As a result, we cannot guarantee that any forward-looking statement will materialize, and the reader is cautioned not to place undue reliance on any forward-looking information. Such information, although considered reasonable by management at the time of preparation, may prove to be incorrect and actual results may differ materially from those anticipated.
Forward-looking statements contained in this news release are expressly qualified by this cautionary statement. The forward-looking statements contained in this news release are made as at the date of this news release, and the Company does not undertake any obligation to update publicly or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise, except as expressly required by Canadian securities law.
This press release does not constitute an offer to sell or a solicitation of an offer to buy any of the securities in the United States. The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the “U.S. Securities Act”) or any state securities laws and may not be offered or sold within the United States unless registered under the U.S. Securities Act and applicable state securities laws, unless an exemption from such registration is available.