Binding Heads of Terms for a Loan and Option Agreement with the shareholder of CEDEX

TechFinancials Inc.

(“TechFinancials” or the “Company”)

Binding Heads of Terms for a Loan and Option Agreement with the shareholder of CEDEX

TechFinancials (AIM: TECH), a leading technology provider to financial trading brokers, today announces it has entered into legally binding heads of terms (the “Heads of Terms”) with Saar Levi in respect of a to be incorporated group of companies which will operate under the name CEDEX.com (“CEDEX”). CEDEX will operate what the Company believes will be the first Blockchain based online exchange for diamonds with a long-term vision to turn the traditional diamond industry into a financial tradable asset.

Under the Heads of Terms, TechFinancials will make unsecured loan funding of US$400,000 available to the CEDEX group to develop its technology. The loan bears no interest. TechFinancials can seek repayment of the loan once CEDEX has sufficient funds and the loan therefore has no set maturity date.

In consideration for providing this initial funding, upon incorporation of the CEDEX holding company (“CEDEX HoldCo”), CEDEX HoldCo will grant the Company an option to acquire 90 per cent of CEDEX HoldCo at an exercise price of US$40,000, which may be offset against any amount outstanding under the loan.  Exercise of the option is at the sole discretion of TechFinancials and the option can be transferred, sold or disposed of as TechFinancials sees fit.  The option period is for three years from the date of grant.

It is envisaged that CEDEX will also utilise the Company’s knowledge and expertise. In addition, the Company may provide technical development services on a fee-for-service basis to CEDEX to assist with the development of the trading platform.

The collaboration with CEDEX is a strategic development aligned with the Company’s long-term vision of utilizing its expertise and considerable experience in the development of online financial trading solutions and technology systems to further expand into new product areas. It is anticipated that CEDEX will provide a novel way to invest in diamonds, aligned with the Company’s vision of simplifying trading instruments.

Further information about CEDEX is set out below and will be available on its website www.cedex.comthat will accessible by the public in early November 2017.

The information contained within this announcement is deemed to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014. Upon the publication of this announcement, this inside information is now considered to be in the public domain.

For further information:

TechFinancials, Inc. Tel: +972 54 5233 943
Asaf Lahav, Group Chief Executive Officer
Yuval Tovias, Chief Financial Officer
Grant Thornton UK LLP (Nominated Adviser) Tel: +44 (0) 20 7383 5100
Colin Aaronson / Samantha Harrison / Seamus Fricker
Northland Capital Partners Limited (Broker) Tel: +44 (0) 20 3861 6625
David Hignell / Rob Rees
NEX Corporate Adviser and Joint Broker Peterhouse Corporate Finance Tel: +44 (0) 20 7469 0930
Fungai Ndoro / Eran Zucker

Media enquiries:

Yellow Jersey PR Limited (Media Relations) Tel: +44 (0) 7748 843 871
Charles Goodwin / Felicity Winkles

Background to CEDEX

CEDEX will be founded by a team of individuals with extensive knowledge and experience of the diamonds industry, online solutions and financial markets. CEDEX.com will be developed as a global Blockchain based exchange, which focuses on using innovative technology to bridge the gap between the traditional diamond industry and the financial markets. CEDEX seeks to engineer a ground-breaking change, enabling people to liquidate and invest in diamonds in a transparent and secure way.

The new exchange’s main revenue stream will be based on diamond listing fees and transaction fees based on trades being executed in the exchange.

The CEDEX exchange will be designed to address three obstacles in transforming diamonds into a financial asset: Transparency, Liquidity and Fungibility. To solve these obstacles CEDEX will develop a set of proprietary algorithms, the “DEX”. The DEX will compile the gemological data, diamond financial indices and global inventory to rank each diamond’s price relative to its theoretical market value. In addition, CEDEX will utilise Blockchain technology to tokenize diamonds enabling both diamond holders looking to liquidate their positions and investors seeking to protect their assets to include diamonds as a financial investment.

CEDEX is also evaluating, subject to legal advice, the viability of the holding company of the CEDEX group creating and selling a new digital token, to be formed for this purpose, using Blockchain technologies in an amount of $18M-$30M during Q1 2018. The receipts of any token sale will be used by the CEDEX project mainly for development, marketing, legal and regulatory compliance, and operation of the project. CEDEX will not offer equity or any other rights in CEDEX (or any of its group companies) to buyers under the token sale but rather sell digital tokens which represent the basic unit of value to be used on the CEDEX.com exchange. 

About TechFinancials

TechFinancials plc (AIM: TECH) is a leading innovator and supplier of financial trading solutions for retail clients. The Group operates a B2B division licensing white label trading platform solutions to online brokers. In addition, the Company operates a B2C division operating trading platforms worldwide and incorporating a strategic joint venture focusing on solutions for traders in the Asia Pacific region.

Further information can be found at http://techfinancials.com.