BBTV HOLDINGS ANNOUNCES $65M CONVERTIBLE DEBENTURE AND REFINANCING COMMITMENT PROVIDING CAPITAL FOR GROWTH INITIATIVES INCLUDING M&A, DEBT REDUCTION, AND DEBT DEFERMENT

- $65M equity and refinancing commitment is inclusive of a $15M Bought Deal of convertible debentures co-led by Eight Capital and Canaccord Genuity, and

- A $20M non-brokered placement of convertible debentures by a major Canadian trillion dollar institutional asset manager, and

- $29M deferment of debt for 5 years to 2026 with existing lending partner

Wednesday, May 26th 2021

THIS NEWS RELEASE IS INTENDED FOR DISTRIBUTION IN CANADA ONLY AND IS NOT INTENDED FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR DISSEMINATION IN THE UNITED STATES.

Vancouver, B.C.: BBTV Holdings Inc. (TSX: BBTV; OTCQX: BBTVF) (“BBTV” or the “Company”) is pleased to announce it has entered into an agreement pursuant to which Eight Capital and Canaccord Genuity Corp., as co-lead underwriters and joint bookrunners, together with a syndicate of underwriters (collectively, the “Underwriters”), will purchase 15,000 convertible debentures of the Company (the “Convertible Debentures”), on a “bought deal” basis pursuant to the filing of a short form prospectus, subject to all required regulatory approvals, at a price per Convertible Debenture of $1,000 (the “Issue Price”) for gross proceeds of $15,000,000 (the “Bought Deal”).

The Company is also pleased to announce that it has entered into a binding agreement with a long-term focussed, major Canadian trillion dollar institutional asset manager for the purchase and sale of 20,000 Convertible Debentures at the Issue Price for gross proceeds of $20,000,000 (the “Private Placement”), resulting in aggregate gross proceeds from the Bought Deal and the Private Placement (together, the “Convertible Debenture Financing”) of $35,000,000.

“We are pleased to announce this financing package which in our view is a strong endorsement from the financial community of our mission, vision and execution of our strategic business plan,” said Shahrzad Rafati, Chair and CEO of BBTV. “This financing and deferment package is a significant boost to the Company’s balance sheet which not only serves as a definitive solution to our current debt load but also provides capital to drive our growth initiatives including our M&A program. We are grateful for the support of the participating shareholders and believe their support is reflective of the strong platform for growth that we’ve created at BBTV and our commitment to provide content creators with best in class tech-enabled creator monetization solutions.”

The Company has agreed to grant the Underwriters an over-allotment option to purchase up to an additional 15% of the Convertible Debentures issuable pursuant to the Bought Deal, exercisable in whole or in part, at any time on or prior to the date that is 30 days following the closing of the Bought Deal.

The Convertible Debentures will have a maturity date of five years from the closing date of the Offering (the “Maturity Date”) and will bear interest from the date of closing at 7.0% per annum, payable annually December 31 of each year. The Convertible Debentures will be convertible, at the option of the holder, into subordinate voting shares of the Company (the “Shares”) at any time prior to the close of business on the last business day immediately preceding the Maturity Date at a conversion price of $10.55 per Share (the “Conversion Price”). The Company may force the conversion of the principal amount of the then outstanding Convertible Debentures at the Conversion Price on not less than 30 days’ notice if, at any time following the date that is 4 months and 1 day following the Closing Date, the closing price of the Shares is greater than $20.00 for the preceding 20 consecutive trading days (a “Mandatory Conversion”). In the event of a Mandatory Conversion prior to the 3-year anniversary of the Closing Date (the “3-year Anniversary”), in addition to any unpaid and accrued interest, the holders of Convertible Debentures shall be entitled to an amount equal to interest that would otherwise be payable from the time of the Mandatory Conversion until the 3-year Anniversary.

The Company intends to use the net proceeds of the Convertible Debenture Financing to: (i) to prepay $20,000,000 of the principal outstanding under the Company’s existing senior secured convertible promissory loan (the “Debt Prepayment”) with UFA Film und Fernseh GmbH (the “Secured Convertible Loan”); (ii) for M&A transactions; and (iii) for working capital and general corporate purposes.

In connection with the Convertible Debenture Financing, the Company has also entered into an agreement with its senior secured lender, UFA Film und Fernseh GmbH, to amend the terms of its Secured Convertible Loan (the “Secured Convertible Loan Amendments”), including the following:

  • The maturity date will be extended to the date that is 5 years from the finalization of the Secured Convertible Loan Amendments;
  • The Secured Convertible Loan will bear interest at a rate of 8% per annum, from a current interest rate that escalates from 8% presently to higher rates at the time of maturity, payable at the end of the term;
  • The Secured Convertible Loan can be prepaid without penalty at any time;
  • At maturity, the Secured Convertible Loan will be convertible, at the option of the lender, into Shares at a conversion price equal to the 5-day volume weighted average trading price of the Shares immediately prior to the maturity date, plus a 20% premium;
  • 25% of the proceeds of future offering of equity securities or debt by the Company are to be applied to the prepayment of the Secured Convertible Loan; and
  • Upon the Debt Prepayment, and after adding accrued and unpaid interest to the principal amount of the Secured Convertible Loan, the amount outstanding pursuant to the Secured Convertible Loan will be approximately $29,000,000 (assuming that the Convertible Debenture Financing and the Debt Prepayment completes on or about June 15, 2021).

The closing date of the Convertible Debenture Financing and the Secured Convertible Loan Amendments is scheduled to be on or about June 15, 2021 and is subject to certain conditions including, but not limited to, the receipt of all necessary approvals, including the approval of the TSX and the applicable securities regulatory authorities.

This news release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any state in which such offer, solicitation or sale would be unlawful. The securities being offered have not been, nor will they be, registered under the United States Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the United States Securities Act of 1933, as amended, and applicable state securities laws.

BBTV HOLDINGS INC.
Per: “Shahrzad Rafati”
Shahrzad Rafati
Chief Executive Officer

About BBTV
BBTV is a global media and technology company headquartered in Vancouver, Canada. The Company’s mission is to help content creators become more successful. With creators ranging from individuals to global media brands, BBTV provides a comprehensive, end-to-end solution to increase viewership and drive revenue powered by its innovative technology, while allowing creators to focus on their core competency – content creation. In January 2021, BBTV had the second most unique monthly viewers among digital platforms with more than 600 million globally, who consumed more than 50 billion minutes of video content, the most among media companies [1]. (www.bbtv.com)

[1] Comscore’s “Top 12 Countries = January 2021 comScore Video Metrix Media Trend – Multi-Platform – Top 100 Video Properties Report”; Top 12 countries represent ~50% of world’s digital population.

Notice Regarding Forward Looking Statements
This news release contains forward‐looking information within the meaning of applicable securities legislation, including statements with regards to: the offering and closing of the Convertible Debenture Financing and the timing thereof; the proposed use of proceeds from the Convertible Debenture Financing; the closing of the Secured Convertible Loan Amendments and the timing thereof; and that the deferment package will be a solution to the Company’s current debt load and driver of future M&A. Such forward-looking information reflects the Company’s current expectations regarding future events. Forward‐looking information is based on a number of assumptions and is subject to a number of risks and uncertainties, many of which are beyond the Company’s control, which could cause actual results and events to differ materially from those that are disclosed in or implied by such forward‐looking information. Such risks and uncertainties include, but are not limited to, the inability of the Company to close the Convertible Debenture Financing and Secured Convertible Loan Amendments for any reason, risks inherent in the technology, media, advertising, and creator economy sectors in general, business disruption and operation risks related to COVID-19, other factors beyond the control of the Company, and the risk factors disclosed in the Company’s periodic reports publicly filed and available at www.sedar.com. The Company does not undertake any obligation to update such forward‐looking information, whether as a result of new information, future events or otherwise, except as expressly required by applicable law.

For further information

Media Relations
Dan Gamble
Head of PR & Corporate Communications
778-873-0422
dgamble@bbtv.com

Investor Relations
ir@bbtv.com

Ron Shuttleworth
Partner
Oak Hill Financial Inc
(647)–500–7371
rshuttleworth@oakhillfinancial.ca

BBTV-F