Seed Innov Regulatory News (SEED)

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

8 June 2022

SEED Innovations Limited ("SEED" or the "Company")

Loan to Portfolio Company, Leap Gaming

SEED Innovations Limited, the AIM quoted company investing in fast growing and industry leading businesses with a focus on the medical cannabis, health and wellness space  announces that it has provided a Term Loan of up to €250,000 to portfolio company Fralis LLC, trading as Leap Gaming ('Leap'), an Israel based B2B developer of high-end 3D gaming applications whose games are offered by leading online and retail gaming operators worldwide (the 'Term Loan').

The Company and Leap have agreed that the Term Loan will be drawn down in tranches, with the first tranche of €100,000 drawn down initially. Further drawdowns of the Term Loan may be drawn in one or more tranches with the agreement of SEED.

The Term Loan will be used for working capital purposes as Leap advances towards a liquidity event by way of either an initial public offer of its shares or reverse takeover transaction, anticipated in late 2022.

The Term Loan will be payable on completion of certain conditions precedent, including the payment of a €10,000 arrangement fee by Leap to SEED, which are expected to be satisfied imminently.

Ed McDermott, CEO of SEED, commented: "We are pleased to be able to further support Leap, one of our long term and largest investments, at a time in which we believe there is significant progress being made operationally. Following the milestone award of the content supply license by the UKGC to Leap, and most recently a license to enter into the Lithuanian market, we anticipate support for Leap's growth and we will work with the board of Leap towards a liquidity event over the coming months."

Principal Terms of the Term Loan

· The Term Loan attracts interest of 10% per annum, payable on the 6 April 2023, being the repayment date

· The Term Loan is repayable as follows:

o on the earlier of 6 April 2023; or

o immediately on the Leap completing any Qualifying Financing (including (i) in one or more transactions (aggregated over a period of 12 months), raising equity capital of greater than €1,000,000 from existing or new investors; or (ii) completing an initial public offer of its shares (including by way of reverse takeover transaction or similar); or (iii) a sale of any assets of Leap realising proceeds greater than € 250,000

· €10,000 arrangement fee payable by Leap to SEED

Schedule 4 Disclosure

SEED has a total amount of approximately £4.7 million invested in Leap as at the last balance sheet date (comprised of circa £633,000 (€733,000) by way of convertible loan notes and £4.07 million in equity), representing approximately 43.75% of Leap (on a fully diluted basis).

SEED expects to carry its investment in Leap at a value of c.£8.27 million as at 31 March 2022.

About Leap Gaming

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. Unaudited turnover for the year to 31 December 2021 was €3.1 million, with operating profit of €615,000.The recent licensing news such as the granting of a content supply license by the United Kingdom Gaming Commission ("UKGC")] is a significant milestone for Leap, allowing it to access the lucrative UK gaming market, which, according to the UKGC, the regulated gambling industry in Great Britain generated a gross gambling yield ("GGY") of £14.1bn during the period April 2019 to Mar 2021. The UKGC license is added to the other recent licenses obtained by Leap in Sweden, the Netherlands, Romania, South Africa and Greece.

***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.