ENABLENCE TECHNOLOGIES ANNOUNCES AMENDMENT TO SENIOR LOAN AGREEMENT AND SENIOR MANAGEMENT CHANGES

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OTTAWA (ON), January 10, 2022 /CNW/ – Enablence Technologies Inc. (“Activate“or the”Society“) (TSXV: ENA), a supplier of optical components and subsystems, is pleased to announce that it has entered into an Amended and Restated Senior Loan Agreement (the “Modified Senior Loan Agreement“) with Vortex ENA LP (“Vortex“), a related party to the Company. The Company is also pleased to announce that T. Paul Rowland will join the Company as Interim Chief Financial Officer (“CFO“), subject to the approval of the TSX Venture Exchange (“TSXV”). Mr Rowland will replace the company’s current Chief Financial Officer, Fashion Craig, effective January 17, 2022. Mr. Mode will remain in his role as Co-Chief Executive Officer (“Co-CEO“) up to January 31, 2022, to help with transition tasks, after which he will leave the company and Ashok Balakrishnan will be the sole CEO of the Company.

Modified Senior Loan Agreement

The Company has entered into the Amended Senior Loan Agreement effective as of December 31, 2021, with certain terms described below. A full copy of the amended loan is available on SEDAR under the Company’s issuer profile.

  • Consolidated loan balance, including advances on principal, accrued interest and fees to December 31, 2021 of about $6.9 million (the “Loan Balance“);

  • The balance of the loan comprises approximately $1.0 million amounts previously recorded in the Company’s accounts payable which were acquired by Vortex under the amended loan;

  • Due date of December 31, 2025, subject to a six-month extension option upon written request from Enablence;

  • Interest rate of 7.5% per annum; interest accrues up to December 31, 2023 and payable monthly in cash thereafter;

  • Further advances under the Loan will be subject to Vortex’s sole discretion; and

  • All prior defects have been permanently canceled.

As Vortex is a “related party” to the Company, the execution of the Amended Senior Loan Agreement is considered a “related party transaction” for the purposes of Multilateral Instrument 61-101 – Protection of holders of minority securities in special transactions (“MI 61-101The company did not file a material change report more than 21 days before accepting the modified senior loan agreement, as the details of the modifications were not finalized until shortly before this announcement. company relies on exemptions from the formal agreement valuation and minority shareholder approval requirements available under NI 61-101 The Company is exempt from the formal valuation requirement of Section 5.4 of the Regulation 61-101 in reliance on section 5.5(b) of Regulation 61-101, as the Company is not listed on a specified market under Regulation 61-101. In addition, the Company is exempt from the the minority shareholder approval requirement set out in section 5.6 of NI 61-101 based on section 5.7(f) of NI 61-101.

The Amended Senior Loan Agreement is subject to the approval of the TSX Venture Exchange.

Senior management changes

The Company is also pleased to announce that T. Paul Rowland joined the Company as CFO, replacing the current CFO of the Company, Fashion Craig, effective January 17, 2022. Mr. Mode will also step down as co-CEO on January 31, 2022, after a short transition period. Mr. Mode’s resignation was accepted by the Company’s Board of Directors. Mr. Mode was hired by the Company in May 2021 to lead its recently completed recapitalization operation. After the end of the transition period the January 31, 2022, he will resume his previous role as a venture capitalist.

Mr T. Paul Rowland is a seasoned finance executive with over 35 years of experience in various senior finance and accounting roles. Most recently, Rowland served for four years as Chief Financial Officer and Corporate Secretary of Brane Inc., a private cryptocurrency and blockchain company. Prior to this role, he held executive positions at Yamana Gold Inc. and Barrick Gold Corporation and was Chief Financial Officer of a publicly traded resource company. Mr. Rowland is a Chartered Professional Accountant, Chartered Public Accountant (Illinois), and a Certified Global Management Accountant. He graduated from Western University with an Honors Bachelor of Science. Mr. Rowland’s appointment remains subject to TSXV approval.

About Enablence Technologies Inc.

Enablence is a publicly traded company that designs, manufactures and sells optical components and subsystems to a global customer base. It uses its patented technologies, including the intellectual property of the Planar Lightwave Circuit, in the production of a set of photonic components and broadband subsystems that provide a key part of the infrastructure of telecommunication systems. current and next generation. The Company’s components are key elements in large optical network infrastructure builds that enable global networking and large-scale computing for businesses and individuals, including data centers and backbone networks. 5G telecommunications. For more information, visit www.enablence.com.

Forward-looking statements

This press release contains forward-looking statements about the Company based on management’s current expectations and assumptions, which involve known and unknown risks and uncertainties associated with our business and the economic environment in which it operates. All of these statements are forward-looking statements under applicable Canadian securities laws. All statements contained herein that are not statements of historical fact may be deemed to be forward-looking statements. In particular, this press release contains forward-looking statements regarding the timing and ability of the Company to obtain regulatory (including TSX Venture Exchange) approvals of the Amended Senior Loan Agreement and the appointment of the Interim Chief Financial Officer. By their nature, forward-looking statements require us to make assumptions. Assumptions are based in part on the ability to obtain regulatory approval. These statements are based on current expectations which involve a number of risks and uncertainties that could cause actual results to differ from those anticipated. These risks include, but are not limited to, risks relating to the Company’s inability to obtain required regulatory approvals (including the TSX Venture Exchange); the terms described herein may change after the date hereof; the impact of the evolution of the COVID-19 pandemic on the Company’s business, operations and sales; uncertainties related to the ultimate spread, severity and duration of COVID-19 and the related adverse effects on the economies and financial markets of the countries in which the Company operates; and the Company’s ability to successfully implement its business continuity plans in relation to the COVID-19 pandemic. Although the Company believes that the expectations reflected in the forward-looking statements contained in this press release and the assumptions on which such forward-looking statements are based are reasonable, there can be no assurance that such expectations will prove to be correct. We caution our readers of this release not to place undue reliance on our forward-looking statements, as a number of factors could cause actual results or conditions to differ materially from current expectations. Additional information about these and other factors that could affect the operations of the Company is set out in the Company’s continuous disclosure documents which are available on SEDAR (www.sedar.com) under Enablence’s issuer profile. Enablence does not intend and disclaims any obligation, except as required by law, to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

SOURCEEnablence Technologies Inc.

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