Lionsgold Ltd (AIM:LION) Proposed Investment – Goldbloc Banking Platform

Lionsgold (LON: LION), the AIM quoted company focused on the exploration, production and retail application of physical gold, including the development of the Goldbloc digital currency, announces that it has entered into a Binding Heads of Agreement (“BHA”) for an investment into global banking and compliance platform provider, Railsbank Technology Limited (“Railsbank”).

Highlights:

· Lionsgold plans to invest £1.25 million from existing funds in Railsbank for a 12.5% equity stake, on a fully diluted basis following completion of Railsbank’s current funding round.

· The BHA is binding on Railsbank and Lionsgold has an exclusive 30 day period within which to complete its due diligence and decide to proceed with the subscription.

· Demonstrating management’s belief in the viability and potential value of Railsbank and its underlying technology, concurrently with Lionsgold, LION CEO Cameron Parry plans to co-invest £125,000 in Railsbank for 1.25% on the same terms as the Company and TRAC Technology CEO Ralph Hazell plans to co-invest £50,000 in Railsbank for a 0.5% equity stake.

· Subject to Lionsgold choosing to proceed, Lionsgold (or its subsidiary nominee) to have exclusive access to Railsbank’s banking platform in relation to deposits connected with physical gold or gold derivatives, for a period of three years.

· Upon deal completion, Lionsgold shall appoint a director to the board of Railsbank.

· In addition to securing the exclusive use of Railsbank’s platform for Goldbloc, the Board believes there is significant upside potential to the equity component and it has been agreed that Lionsgold will be entitled to pre-emption rights in relation to any new issue of shares by Railsbank for such time as LION is interested in 10% or more of Railsbank’s shares.

Lionsgold Chief Executive Officer, Cameron Parry, commented:

“Obtaining a strategic holding in Railsbank, subject to Lionsgold deciding to proceed following due diligence, and the protection of exclusive rights to Railsbank’s technology platform, was a key strategy and priority for LION to achieve this quarter for Goldbloc and we are delighted to have concluded this binding agreement well within schedule. Furthermore, following the recent financing and extensive warrant conversions the Company has the financial resources to fund the investment in Railsbank from existing cash.

“We are in the final stages of Goldbloc’s development. As announced on 11 December 2017, the full commercial Goldbloc product offering, with physical debit card(s) attached to the Goldbloc holder’s bank account, is scheduled to be available from Q2 2018.

“We now move into this final development phase with our underlying technology platform secured and able to be exclusively accessed. Further announcements will be made in the lead up to the launch of Goldbloc to the public and we look forward to updating shareholders over the coming weeks in this regard.”

Terms of the Binding Heads of Agreement

Lionsgold and Railsbank entered into a binding heads of terms on 18 January 2018. Under the BHA Lionsgold plans to invest £1.25 million for 128,640 new ordinary shares in Railsbank, representing a 12.5% equity stake on a fully diluted basis following completion of Railsbank’s current funding round.

Lionsgold has an exclusive 30 day due diligence period and subject to LION deciding to complete the subscription, the Company will have five business days to make payment.

Upon deal completion, Lionsgold shall appoint a director to the board of Railsbank and as part of the cornerstone investment, Lionsgold (or its subsidiary nominee) shall be granted the exclusive rights to access Railsbank’s banking platform in relation to deposits connected with physical gold or gold derivitives, for a period of three years from date of subscription completion.

Following the completion of this funding round conducted by Railsbank, Lionsgold shall be entitled to pre-emption rights in relation to any new issue of shares by Railsbank. for such time as LION is interested in 10% or more of Railsbank’s shares. Railsbank reported a loss before tax of £440,454 for the financial year ended 31 March 2017.

Concurrently with Lionsgold completing an investment, LION CEO Cameron Parry, Global Strategy Consultant, Alan Davies and TRAC Technology CEO, Ralph Hazell plan to co-invest £125,000, £125,000 and £50,000 respectively in Railsbank, for equity stakes of 1.25%, 1.25% and 0.5% respectively, on the same terms as the Company.

About Railsbank

Railsbank is a banking and compliance platform which connects a global network of partner banks with companies who want API (Application Programmer Interface) access to global banking.

Railsbank simplifies on-boarding companies to its banking partners, then gives access via the Railsbank API to banking services such as creating digital ledgers, connecting digital ledgers to real bank accounts, issuing IBANs for ledgers, receiving money, sending money, converting money (FX), collecting money (direct debit), issuing cards, and managing credit.

www.railsbank.com

About Goldbloc

Goldbloc is the culmination of ongoing work by Lionsgold and its majority owned fintech subsidiary, The Real Asset Company (“TRAC”) evolving the original TRAC product offering available via www.therealasset.co.uk. The Real Asset Company enables individuals to buy gold and silver bullion securely and efficiently. The user-friendly platform sits on top of global vaulting infrastructure, providing an online account for buying gold and silver and holding precious metals.

Goldbloc, provides the safety and tangibile value of gold to be utilised with the certainty and convenience of everyday banking. Goldbloc’s unique proposition and competitive advantage is the ability to provide a bank account and debit card linked to an individual’s physical gold.

Goldbloc is a breakthrough digital currencty that enables physical gold (each Goldbloc being 1/1,000th of a gram of gold) to be transferred and received via the global banking system.

www.goldbloc.com


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