Toronto, Ontario--(Newsfile Corp. - May 10, 2023) - Playground Ventures Inc. (CSE: PLAY) (the "Company"), announces that the Ontario Securities Commission (the "OSC") has issued a failure to file cease trade order against the Company in respect of the Company's securities under Multilateral Instrument 11-103 Failure-to-File Cease Trade Orders in Multiple Jurisdictions (the "CTO").
The CTO was issued as a result of the Company's failure to file its audited consolidated financial statements for the year ended December 31, 2022, annual management's discussion and analysis for the same period and management certifications of annual filings (collectively, the "Annual Filings") before the May 1, 2023 filing deadline.
The delay is due to lack of funds. An insider of the Company has advanced $33,900 to the Company to pay for the preparation of the financial statements. The Company anticipates that it will be able to file the financial statements and MD&A on or prior to July 30, 2023.
The advance is pursuant to a secured promissory grid note (the "Bridge Note") in the principal amount of up to $50,000, held by a non-arm's length lender (the "Lender") of the Company. The Bridge Note matured on April 17, 2023 (the "Term"), and is secured against all of the assets of the Company. Amounts outstanding under the Bridge Note bear interest of 8% per annum payable with any outstanding principal at the end of the Term, and the interest increases to 15% per annum upon an event of default. The Bridge Note is noted in default and now bears interest of 15% per annum. For more details on the Bridge Note, see the Company's press release dated February 16, 2023.
The advance under the Bridge Note constituted a "related party transaction" as defined in Multilateral Instrument 61-101 - Protection of Minority Securityholders in Special Transactions ("MI 61-101"), as the Lender is a director and officer of the Company. The Company is relying on the exemptions from the valuation and minority shareholder approval requirements of MI 61-101 contained in sections 5.5(g) and 5.7(1)(e) of MI 61-101, as the Company is in financial difficulty and the transaction is designed to improve the financial position of the Company, as determined in accordance with MI 61-101. The Company did not file a material change report in respect of the related party transaction at least 21 days before the closing of the Bridge Note, which the Company deems reasonable.
The Bridge Note was approved by the member of the board of directors of the Company who is independent for the purposes of the Bridge Note. No special committee was established in connection with the Bridge Note, and no materially contrary view or abstention was expressed or made by any director of the Company in relation thereto.
For further information, please contact:
Jon Gill, Chairman and Interim Chief Financial Officer
Tel: 416-361-1913
Email: investors@playgroundventures.com
Forward-Looking Information
This news release contains certain "forward-looking information" within the meaning of applicable securities law. Forward looking information is frequently characterized by words such as "plan", "expect", "project", "intend", "believe", "anticipate", "estimate", "may", "will", "would", "potential", "proposed" and other similar words, or statements that certain events or conditions "may" or "will" occur. These statements are only predictions. Forward-looking information is based on the opinions and estimates of management at the date the information is provided, and is subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected in the forward-looking information. For a description of the risks and uncertainties facing the Company and its business and affairs, readers should refer to the Company's Management's Discussion and Analysis. The Company undertakes no obligation to update forward-looking information if circumstances or management's estimates or opinions should change, unless required by law. The reader is cautioned not to place undue reliance on forward-looking information.
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