(TSXV: LMR) March 20, 2017 – Lomiko Metals Inc. has signed an agreement with engineering partners MegaHertz Power Systems Ltd. and SHD Smart Home Devices Ltd. to accelerate the launch of the USB Spider Charger. SHD is a company jointly launched by Lomiko and MegaHertz February 16, 2016, focused on Internet of Things devices. SHD will develop, contract manufacture, distribute and sell Spider Chargers and related devices. Under the existing agreements, Lomiko and MegaHertz have been working on completing safety certification for power converter for LED lighting systems, the USB Spider Charger devices and coordinating partnerships with manufacturers located in China, India and Canada.
“SHD has an incredible opportunity to participate in a burgeoning IoT and Smart Device market,” said Lomiko CEO A. Paul Gill. “Major companies such as Leviton, Legrand, Pass and Seymour and others have recognized this new market and have launched similar devices.”
There are currently 130 million established households in North America and a healthy seasonally adjusted annualized rate of 1.3 million housing starts. In addition, offices, hotels and coffee shops are also potential markets for USB charging devices. If only one or two USB charging devices are installed in new homes and retrofitted into current homes undergoing renovations, there will be a healthy demand for IoT products. SHD plans to enter into negotiations with IoT distributors to sell the Spider Charger and other related devices in North American markets. Lomiko will share its network of industry connections to help grow the venture and then enjoy the SHD equity multiplier without being burdened with any engineering, new product development, IP or associated marketing costs as the Spider Charger and SHD suite of IoT products are rolled out.
Lomiko will contribute to SHD any and all research and development, trademarks, its e-commerce website, contacts and intellectual property created under its previous licence agreements with MegaHertz Power Systems Ltd. The parties have mutually agreed to transfer the existing licence agreements to SHD, focus the development of IoT products and business under SHD Smart Home Devices, and target the development of a revenue stream and initial public offering for SHD.
Lomiko Metals Inc. already controls 778,890 shares (12.97%) of SHD based on the February 16, 2016 agreement. Now, SHD will recognize the Lomiko assets at a gross conditional value of $474,633 and issue to Lomiko 659,213 new common shares of SHD, valued at $0.72 per share, in lieu of cash payment for the Lomiko assets. Further, Lomiko shall either pay to SHD $150,000 or issue to SHD 600,000 shares of Lomiko common stock within 60 days from the signing of this agreement to receive an additional 208,333 shares of SHD common stock at $0.72 per share and own 19.71% of SHD. Also, SHD shall assume all past, current and future obligations of Lomiko to MegaHertz under the licence agreements and the addendum thereto, and MegaHertz agrees to accept the assumption by SHD of any and all such obligations of Lomiko to MegaHertz.