Baylin Announces Repricing of $10 Million Private Placement

Toronto, Canada August 20, 2021 – Baylin Technologies Inc. (TSX: BYL) (the “Company”) announces that it is repricing its previously announced proposed best efforts private placement financing (the “Offering”) of common shares of the Company (the “Common Shares”) from $0.90 per Common Share to $0.85 per Common Share to better reflect the current market price of the Common Shares. The gross proceeds from the Offering will remain at a minimum of approximately $10 million (11,765,000 Common Shares) as a result of the Financing Commitment (as defined below) but may be increased to a maximum of up to approximately $15 million (17,648,000 Common Shares).

The net proceeds from the Offering will be used for general working capital purposes and for the repayment of outstanding debt.

The Offering is expected to close in one or more tranches, with the first closing on or about September 1, 2021, but in any case not earlier than August 26, 2021, and will be subject to receipt of applicable regulatory approvals and other customary closing conditions, including listing of the Common Shares on the Toronto Stock Exchange (“TSX”). The Common Shares sold in the Offering will have a hold period of four months and one day from the applicable closing date.

As part of the Offering, the Company entered into a separate agreement dated August 11, 2021 with 2385796 Ontario Inc. (the “Insider”), the Company’s largest shareholder, under which the Insider has agreed to support the Offering by agreeing to purchase Common Shares with a purchase price equal to the lesser of (i) $10 million and (ii) the difference between the amount of the Offering and the aggregate purchase price paid by all other investors (if any) in the Offering (the “Financing Commitment”). Accordingly, the Company is assured of receiving at least $10 million in proceeds from the Offering, subject to receipt of applicable regulatory approvals and other customary closing conditions, including listing of the Common Shares on the TSX.

Financing Commitment

The Insider currently holds 26,653,122 Common Shares, representing approximately 42.7% of the 62,447,014 Common Shares outstanding. An Associate of Jeffrey C. Royer, Chairman of the Board of Directors of the Company, holds 2,748,450 Common Shares. Mr. Royer exercises exclusive control over the Common Shares held by the Associate and, by virtue of an agreement with the Associate, over the Common Shares held by the Insider. Together, the Insider and the Associate (the “Insider Group”) hold 29,401,572 Common Shares, representing approximately 47.1% of the Common Shares outstanding.

Assuming the Financing Commitment ($10 million) is exercised in full, the maximum number of Common Shares issuable to the Insider would be 11,765,000, the maximum percentage of currently outstanding Common Shares issuable to the Insider would be 18.8% and the maximum percentage of Common Shares held by the Insider Group after giving effect to the Offering would be 55.5%.

Financial Hardship

As disclosed in its press release of August 11, 2021, the Company has applied to the TSX under section 604(e) of the TSX Company Manual for an exemption from the requirement for disinterested shareholder approval of the Financing Commitment on the basis that the Company is in serious financial difficulty. For further information concerning the application, the Company refers you to that press release.

US Securities Laws Disclaimer

The Common Shares 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 U.S. state securities laws, and may not be offered or sold in the United States without registration under the U.S. Securities Act and all applicable state securities laws or compliance with the requirements of an applicable exemption therefrom. This press release does not constitute an offer to sell or the solicitation of an offer to buy Common Shares in the United States, nor may there be any sale of these Common Shares in any jurisdiction in which such offer, solicitation or sale would be unlawful.

About Baylin

Baylin is a leading, diversified, global technology company. Baylin focuses on research, design, development, manufacturing, and sales of passive and active radio-frequency products and services. We strive to meet our customers’ needs and anticipate the direction of the market.

Forward-looking Information Cautionary Statement

This press release contains forward-looking statements and forward-looking information including, without limitation, statements related to the approval of the TSX, the timing and completion of the Offering and the anticipated use of proceeds by Baylin. The completion and timing of the Offering is subject to a number of conditions, including that all approvals for the Offering will be received, that no material adverse change will occur in Baylin’s operations or the market for its services prior to closing of the Offering and completion of satisfactory due diligence. The intended use of the net proceeds of the Offering by Baylin might change if the board of directors of Baylin determines that it would be in the best interests of Baylin to deploy the proceeds for some other purpose. The words “will”, “expect”, “may” and similar expressions are intended to be among the statements that identify forward-looking statements. The forward-looking statements are founded on the basis of expectations and assumptions made by Baylin.

For further information contact:

Investor Relations:
Kelly Myles, Marketing and Communications Manager
Baylin Technologies Inc.


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