Expected to reduce interest costs, improve cash flow and provide financial flexibility to support execution of the growth strategy

TORONTO, Sept. 21, 2020 /CNW/ – (TSXV: POPR) – PopReach Corporation (“PopReach” or the “Company“), a free-to-play mobile game publisher focused on acquiring and optimizing proven game franchises, today announced that its wholly-owned subsidiary, PopReach Incorporated, has signed a binding agreement for a US$7.5 million senior secured credit facility (the “New Facility“) with a leading Canadian Schedule I Bank (the “Lender“).  The New Facility, secured through the Lender’s Technology and Innovation Banking group, is intended to refinance PopReach’s previous credit facility, of which US$6.6 million is currently outstanding, and also provides PopReach with a US$1.0 million revolving term credit facility.

The New Facility, once closed, will have a 24 month term, with the US$6.5 million term portion bearing interest at the Lender’s U.S. Base Lending Rate plus 3.50% per annum, and the US$1.0 million revolving portion (which is available in US dollars or Canadian dollars) bearing interest at the Lender’s U.S. Base Lending Rate or Prime Lending Rate, as applicable, plus 2.00% per annum.  The US$6.5 million term portion will feature an initial three month interest only payment period, followed by up to 21 equal monthly instalments of principal (each payment calculated as 1/57th of the advance) plus interest, as applicable, with the final payment of the remaining principal and interest then outstanding due 24 months from the initial drawdown date. The New Facility will be guaranteed by PopReach and secured by a first ranking security interest in favour of the Lender over all of the assets and properties of PopReach and of the borrower, PopReach Incorporated.  The New Facility is subject to such guarantee and security documents being entered into, as well as customary financial and other covenants for a transaction of this type.

In addition to providing PopReach with a new US$1.0 million revolving facility for general corporate purposes, the New Facility is intended to allow PopReach to completely refinance its previous credit facility, at a significant improvement from the interest rate of LIBOR plus 7.00% annum, with a LIBOR floor of 2.00%. 

Prepayments of the New Facility are permitted without penalty at any time, in whole or in part.

“This debt refinancing, once closed, will provide significant interest expense savings, improve cash flow, and increase our financial flexibility with additional credit to help support the execution of our growth strategy,” said Christopher Locke, President, COO, and Co-Founder of PopReach. “The considerable improvement in terms, and the opportunity to secure lending from a leading Schedule I Bank, is a testament to the progression and strong financial profile of our organization and we are grateful for the Lender’s support.” 

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About PopReach Corporation

PopReach, a Tier 1 Technology Issuer on the TSX Venture Exchange, is a free-to-play mobile game publisher focused on acquiring and optimizing proven game franchises. The company has acquired 12 successful game franchises competing mainly in the North American game market, including Smurfs’ Village (IP under license), Kitchen Scramble, Gardens of Time, City Girl Life, War of Nations and Kingdoms of Camelot. The company’s franchises are enjoyed by over 1.2 million unique players a month. PopReach, headquartered in Toronto, employs a team of over 120 experts in Toronto, and Bangalore.  

Forward-looking Information

Certain information in this news release constitutes forward-looking statements and forward-looking information under applicable Canadian securities legislation (collectively, “forward-looking information”). Forward-looking information include, but are not limited to, statements with respect to and the business, financials and operations of the Company. Statements containing forward-looking information are not historical facts but instead represent management’s expectations, estimates and projections regarding future events. Forward looking information is necessarily based on a number of opinions, assumptions and estimates that, while considered reasonable by the Company as of the date of this news release, are subject to known and unknown risks, uncertainties, assumptions and other factors that may cause the actual results, level of activity, performance or achievements and future events to be materially different from those expressed or implied by such forward-looking information, including but not limited to the factors described in greater detail in the public documents of the Company available at www.sedar.com. Although the Company has attempted to identify important risks, uncertainties and factors which could cause actual results to differ materially, there may be others that cause results not to be as anticipated, estimated or intended. Investors are cautioned undue reliance should not be placed on any such information, as unknown or unpredictable factors could have material adverse effects on future results, performance or achievements of the Company. The Company does not intend, and does not assume any obligation, to update this forward-looking information except as otherwise required by applicable law.

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