Texas-based Insurance Administrator To Invest Up To USD $12.5 Million
VANCOUVER, BC / ACCESSWIRE / March 16, 2020 / PowerBand Solutions Inc. (TSXV:PBX)(OTCQB:PWWBF)(Frankfurt:1ZVA) ("PowerBand", "PBX" or the "Company") is pleased to announce that Texas-based D&P Holdings, Inc. ("D&P") will exercise its option to invest a further USD $2.5 million into PowerBand's Canadian leasing division.
The investment by D&P, one of the United States' largest administrators of automotive warranty and insurance products, advances PowerBand's ongoing negotiations to secure extensive credit facilities for its cloud-based transaction platform, which will allow consumers and dealers to buy, sell, lease and trade vehicles on their smart phones and other devices.
"I want to assure investors that PowerBand continues its progress to create a platform that will revolutionize how people buy, sell, lease and trade cars and trucks," said PowerBand CEO Kelly Jennings. "This further investment and vote of confidence by D&P, one of America's leaders in the insurance industry, demonstrates we are on track to obtain extensive credit facilities that will allow consumers to acquire electric and traditional vehicles as easily as you buy a product from Amazon or order an Uber on your smart phone."
Jennings, who has more than 27 years of automotive dealership ownership and management, announced on January 29, 2020 that he would not sell any of his more than 41 million PowerBand shares for at least one year.
D&P announced its intent on March 2, 2020 to support PowerBand with an investment of up to USD $10 million into its US subsidiary, PowerBand Solutions US Inc., through a non-brokered private placement of unsecured convertible debentures. The first tranche of USD $1.5 million was completed on March 6, 2020, the second tranche of USD $3.5 million is scheduled to close April 6, 2020 and the third tranche of USD $5 million is scheduled to close May 6, 2020.
D&P is now exercising its other option to invest an additional USD $2.5 million into PowerBand's Canadian leasing arm, bringing its potential investment to USD $12.5 million. In the event all Debentures are converted by D&P, and the option completely subscribed for, D&P will have a 9 per cent interest in PowerBand Solutions US Inc., and a 30 per cent interest in PowerBand's Canadian leasing division, assuming no other securities are issued in the interim.
"PowerBand is clearly on track to secure extensive credit facilities for its revolutionary transaction system for Canada, the United States and other countries," said D&P's CEO John Armstrong. "Powerband will enable a vehicle lease to be approved in seconds, rather than days, as they have proven with Tesla. We think that, in itself, is revolutionary for the automotive sector and will make PowerBand the industry's preeminent platform where people buy, sell, lease and trade in their vehicles."
D&P directly works with more than 850 dealerships in all 50 states. D&P will be granted exclusive global rights to act as administrator for new products being sold through PowerBand's transaction platform. These products include administrating all requested and approved vehicle services contracts, auto warranty products, guaranteed asset protection, down-payment protection, excess wear and tear, key replacement, windshield replacement, tire and wheel, ETCH/anti-theft, lease wrap, and all ancillary products.
About PowerBand Solutions Inc.
PowerBand Solutions Inc. is a technology provider listed on the TSX Venture Exchange. The Company's cloud-based platform is revolutionizing how we buy, sell, lease, and auction vehicles. With the receipt of its exporter license and its acquisition of MUSA Auto Finance, the Company is well positioned to become a leader in the cross-border used vehicle export market, the used vehicle auction market, and the vehicle leasing market in the U.S. and Canada.
For further information, please contact:
Richard Goldman, VP Corporate Development
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SOURCE: PowerBand Solutions Inc.