VANCOUVER, Aug. 22, 2019 /CNW/ - Axion Ventures Inc.
("Axion Ventures" or the "Company") (TSX VENTURE: AXV; OTCQX:
AXNVF) is pleased to announce the following corporate update
pertaining to its video game portfolio including its flagship video
game, Rising Fire, which is under a distribution partnership with
Tencent Holding Limited's (HKG: 0700)
(OTC: TCEHY) ("Tencent").
Summary:
- Rising Fire continually improves and is moving closer to full
commercial launch
- Co-development deal signed with a leading global video game
developer on favorable terms
- Multiple distribution contracts are in negotiation for
commercial launch of Invictus: Lost Soul
- Closing a Convertible Debenture of US$1,375,000
Rising Fire
After five years of development and testing, Rising Fire is in
the late stages of being 'tuned to the market' in open-beta release
by Tencent. Rising Fire represents
over 800 man-years of development and management is confidently
expecting that full commercial launch is approaching.
"Axion has experienced a thorough tuning process working towards
a commercial launch that is typical of the video game industry. As
an analogue, one of Tencent's current games, Crossfire, was
subjected to an almost 24 month 'tuning to market' process prior to
full commercial launch. Crossfire is now in its 10th
year of revenue generation and is Tencent's highest grossing
lifetime video game. The scope, size, and potential of Rising Fire
are reflected in the amount of time that Axion and Tencent have attributed to ensuring the
programmed success of the game at commercial launch," said
Todd Bonner, CEO of Axion
Ventures.
"After the delivery of Rising Fire 'Season 1' in June of 2019,
Tencent began testing the June
delivery in late July. As a result, the game took a major step
towards our expected outcome and management is optimistic that a
fully marketed commercial launch will commence in China in the near future. Management is also
in late-stage discussions with multiple publishers in various
jurisdictions to launch Rising Fire, which we expect to be
announced shortly," added Mr. Bonner.
The rate of capital expenditure that has been invested in Rising
Fire over the last five years should decline materially as the
video game is largely complete and hence past its peak funding
phase.
Co-Development Deal
As announced on July 22, 2019,
Axion entered into a major co-development contract for a new video
game that will require a re-allocation of developers and capital.
As a part of the contract, Axion will realize revenue from their
partner for development work completed and the first revenue
billing from the co-development project will be paid to Axion upon
the completion of the game prototype, expected by the end of
September.
"Axion has been developing a portfolio of video games for the
last seven years during which we utilized the Company's revenues
and resources to fund the expansion of a deep IP portfolio perhaps
unrivalled by any independent studio in Asia. This capability was recognized by our
partner in the new IP ownership project, which provides our Company
with a fiscally sound model to leverage the prowess of the
partner's global leadership as an IP creator while the majority of
the development costs shall be underwritten by the partner. As a
Company, we are reaching an inflection point where our major games
are reaching commercial launch and will enter an exciting and
rewarding monetization phase for the Company, and we have since
been approached by several other leading studios to form similar
co-development partnerships," added Todd
Bonner, CEO of Axion Ventures.
Invictus: Lost Soul
After a very successful open beta launch in May 2019 of the Company's first mobile game, the
retention numbers that were generated during this period were
highly encouraging and, as such, gained the attention from multiple
distribution partners globally. The Company is currently fine
tuning the game and adding new content, such as armour, weapons,
skins, and emotes, and monetization mechanics while engaged
actively in multiple negotiations for wide-scale
distribution.
"Invictus: Lost Soul cost just US$1.4M to develop and the retention metrics that
we have encountered from the beta release firmly indicate a major
industry hit. We are extremely confident that it is a formative
example of our value as a studio by way of generating substantial
returns on our investment and the creation of a portfolio of video
game IP ownership," said Todd
Bonner, CEO of Axion Ventures.
Convertible Debenture
The Company recently announced a shareholder loan of
US$873,000 (see news release dated
August 16, 2019) to provide capital
for growth and on-going expenses. The majority of expenses are
attributed to the Company's 2,000+ man year portfolio that
continues to grow and gain traction with major video game
distributors.
Axion further announces that it has closed a non-brokered
private placement (the "Financing") of convertible
debentures (each, a "Debenture"), pursuant to which it has
issued Debentures in the principal amount of US$1.375 million. The Debentures are convertible
into common shares (each, a "Share") of the Company at a
conversion price of CDN$0.90 per
Share. The Debentures mature one (1) year from the date of
the closing of the Financing (the "Maturity Date") and bear
interest (the "Interest") at the rate of 10% per
annum.
At any time after the issue date, the then outstanding principal
amount may be prepaid in whole or in part upon payment from the
Company to the holder of an early repayment penalty amount equal to
120% of the outstanding principal (which amount includes payment of
any accrued and unpaid Interest). The holder has the option
to exercise the holder's rights of conversion for a period of 30
days after receipt of notice from the Company regarding
prepayment.
The proceeds of the Financing will be used for funding the
Company's portfolio companies and for general working capital. The
Company did not pay any finder's fees in connection with the
Financing. The securities issued in connection with the closing of
the Financing are subject to a restricted period that expires on
December 23, 2019. The Financing is
subject to final TSXV approval.
Comprehensive Portfolio Update: October 2019
Management is also expecting to provide a full corporate update
to shareholders in October.
About Axion Ventures
Axion Ventures is an Investment Issuer with majority ownership
in Axion Games, an online video game development and publishing
company headquartered in Shanghai,
China as well as in True Axion Interactive Ltd., its video
game development company headquartered in Bangkok, Thailand cofounded with True
Corporation. Axion Ventures also maintains holdings in other
innovative technology companies.
www.axionventures.com
Axion Ventures Inc. is listed on the TSX Venture Exchange under
the symbol (TSXV: AXV).
Neither the TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release.
Cautionary Statement Regarding Forward-Looking
Information
Certain statements contained in this press release may
constitute forward-looking information. These statements relate to
future events or future performance. The use of any of the words
"could", "intend", "expect", "believe", "will", "projected",
"estimated", "proposed" and similar expressions and statements
relating to matters that are not historical facts are intended to
identify forward-looking information and are based on the Company's
current belief or assumptions as to the outcome and timing of such
future events. Actual future results may differ materially. In
particular, this release contains forward-looking information
relating to: commercial launch of Rising Fire in China in Q4 2019; publisher negotiations and
related announcements; prototype delivery in September 2019; and use of proceeds from the
Financing. Various assumptions or factors are typically applied in
drawing conclusions or making the forecasts or projections set out
in forward-looking information. Those assumptions and factors are
based on information currently available to the Company. Risk
factors that could cause actual results or outcomes to differ
materially from the results expressed or implied by forward-looking
information include, among other things: general economic and
business conditions; regulatory approval; and changes in regulatory
regime. The Company cautions the reader that the above list of risk
factors is not exhaustive. The forward-looking information
contained in this release is made as of the date hereof and the
Company is not obligated to update or revise any forward-looking
information, whether as a result of new information, future events
or otherwise, except as required by applicable securities laws.
Because of the risks, uncertainties and assumptions contained
herein, investors should not place undue reliance on
forward-looking information. The foregoing statements expressly
qualify any forward-looking information contained herein.
Neither the TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release.
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SOURCE Axion Ventures Inc.
