Dynamic Technologies Announces Proposed Transaction And Provides Update

WINNIPEG, Manitoba, June 13, 2023 (GLOBE NEWSWIRE) -- Dynamic Technologies Group Inc. (NEX: DTG.H, OTC:ERILF) (“Dynamic”, “DTGI” or “Company”) announces that on June 23, 2023 at 2:00 p.m. it intends to seek approval from the Court of King’s Bench of Alberta (the “Court”) under the Companies’ Creditors Arrangement Act (Canada) (the “CCAA”) for an approval and reverse vesting order and a sale approval and vesting order (collectively, the “Court Order”) to implement the Transaction (described below) involving Dynamic and its subsidiaries, Dynamic Attractions Ltd., Dynamic Entertainment Group Ltd., Dynamic Structures Ltd. and Dynamic Attractions Inc. (“Subsidiaries”).

The Transaction
Dynamic and its Subsidiaries intend to complete a transaction (the “Transaction”) pursuant to which, among other things: (i) a newly formed Canadian subsidiary of Promising Expert Limited (the “Purchaser”) will acquire: (i) one (1) new Class “A” Common Share in the capital of Dynamic (the “DTGI Share”) for a subscription price of $1.00, and all other issued and outstanding equity securities in the capital of Dynamic other than the DTGI Share will be cancelled, resulting in the Purchaser owning 100% of the issued and outstanding equity securities of Dynamic upon implementation of the Transaction; (ii) all of the issued and outstanding equity securities in the capital of Dynamic Structures Ltd. (“DSL”), other than the equity securities of DSL held by persons other than Dynamic which will be cancelled for no consideration, resulting in the Purchaser owning 100% of the issued and outstanding equity securities of DSL upon implementation of the Transaction; (iii) all of the issued and outstanding equity securities in the capital of Dynamic Attractions Ltd. (“DAL”); and (iv) all of the issued and outstanding equity securities in the capital of Dynamic Entertainment Group Ltd. (“DEGL”).

The purchase price payable pursuant to the transaction shall be: (i) a credit bid of secured claims being a portion of the debt owed by Dynamic to the Purchaser; (ii) the set-off and cancelling of a portion of the debt owed by Dynamic to the Purchaser under the DIP loan agreement, including any accrued and unpaid interest on the entire DIP loan amount and any costs incurred by the Purchaser as interim lender; (iii) the cash payment of certain priority payables and wind-down costs; (iv) the assumption of certain retained liabilities, including the principal amount, plus accrued interest thereon, that is owed to High Express Holdings Limited, as lender, by DEGL; plus (v) certain other retained liabilities enumerated in the Transaction agreement which will continue to be liabilities of Dynamic and its Subsidiaries following consummation of the Transaction. Excluded liabilities and excluded assets of the Dynamic and its Subsidiaries will be vested out of Dynamic and its Subsidiaries and will be assumed and taken up by another entity referred to as a residual company (“ResidualCo”) pursuant to the Court Order. All claims against Dynamic and its Subsidiaries that are not satisfied through the Transaction will now be claims against ResidualCo and will have the same priority against any of the excluded assets that are transferred into ResidualCo.