SMC executes definitive agreement to acquire 100% equity interest in Genesis

SMC Entertainment Inc. executed a definitive share purchase agreement for its acquisition of 100% equity interest in diversified financial services company Genesis Financial Inc. for $45 million.

The acquisition is scheduled to close on or before Dec. 10.

Genesis Financial currently has 23 employees under its purview together with 120 financial consultants, advisers and representatives. The company focuses on financial technology-powered wealth management advisory services and operates its business through two Australian regulated entities in wealth management, tax and accounting advisory services.

Under the agreement, SMC will issue series B preferred shares with a redemption value equal to $45 million. The preferred shares are convertible to common shares at a discount of 10% to the preceding 10-day weighted average price prior to any conversion.

Additionally, pursuant to the agreement, the new board is allowed to issue up to 20 million warrants to Genesis Financial stakeholders and other strategic partners, vendors and advisers at an exercise price of $1 per warrant with a three-year exercise period from the date of issue. Genesis Financial shall also be entitled to nominate two members to the board of directors, and the management and executive team of the company will be expanded to reflect the new growth platform.

Immediately upon closing of the transaction, SMC will perform a two-year audit of its financial statements; attain a reporting issuer status with the Securities and Exchange Commission; undertake a company name and symbol change; start the process to uplist to a senior public listing exchange; and embark on a capital raise of $15 million for further expansion, acquisitions and working capital.