Seed Regulatory News (SEED)

The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014 ('MAR').

Seed Innovations Ltd / AIM: SEED / Sector: Closed End Investments

11 April 2023

SEED Innovations Ltd ("SEED" or, the "Company")

 Leap Gaming Update - Offer Declared Unconditional

Divestment will secure approximately €5.8m Cash to the Company over 2 year period

SEED Innovations Ltd, the AIM quoted company focusing on making investments in fast growing and industry leading businesses with a focus on the medical cannabis, health and wellness space, is pleased to announce that, further to the announcement of 7 December 2022, the sale of portfolio company Fralis LLC (trading as Leap Gaming, 'Leap'), is now unconditional and completion has occurred ('Completion').

As previously announced, Leap entered into a conditional Sale & Purchase Agreement ('SPA') for the sale of the remainder of Leap to existing unitholder IMG Arena US, LLC ('IMG') based upon an enterprise value of €14 million (the 'Leap Transaction'). IMG is an existing investor in, and was the second largest owner of, Leap. Following the transaction, Leap will be wholly owned by IMG.

Sale proceeds due to SEED will be received by the Company in the coming days as follows:

· €2.8 million being 50% of the sale proceeds due to SEED under the agreement (and after adjustment for working capital and repayment of debt); and

· €268,000 being repayment of the Company's €250,000 term loan (as announced on 8 June 2022), together with accrued interest.

The second tranche of sale proceeds, being €2.8 million (calculated as the remaining 50% of the sale proceeds and subject only to any claims under customary warranties & indemnities,), is expected to be received in April 2024, being the 12-month anniversary of Completion, as per the terms of the SPA.

The Company intends to use the proceeds received for making further investments in accordance with its investing policy.

Ed McDermott, CEO, commented: "I am pleased to be able to confirm to shareholders that the sale of Leap to IMG Arena has been declared unconditional and has concluded in line with the anticipated timelines. The initial cash proceeds, and the balance paid on the 12-month anniversary of Completion, provides us with liquidity at a time where we are seeing some very promising investment opportunities. We strongly believe that our portfolio has the potential to create short, medium- and long-term value creation. 

"We wish Leap and IMG well in the future."

ENDS

For further information on the Company please visit www.seedinnovations.co or contact:

Notes

SEED Innovations is an AIM quoted investment company focused primarily on disruptive high growth life sciences and technology businesses particularly within the medical cannabis arena. The Company's strategy is to identify early-stage opportunities that have an upcoming investment catalyst and grow its portfolio in terms of value whilst limiting the number of investee companies to a level where relevant time can be devoted to each.

Leap is a developer of high-end virtual-sports, slots, and casino applications serving hundreds of gaming brands and generating tens of thousands of engagement points with end-users. Leap's attention to detail in its solutions and services is manifested in the modular engagement terms it offers to its operating partners and its ability to provide seamless experiences across mobile, desktop and retail environments. Leap is licensed by the MGA and certified for other jurisdictions worldwide, including the United Kingdom, Sweden, the Netherlands, Romania, South Africa and Greece.