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XTL To Aquire The Social Proxy

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XTL Biopharmaceuticals expands its IP portfolio by acquiring THE SOCIAL PROXY , a web data AI company, in a $1.5 million private placement deal. The acquisition aims to develop a unique ethical, IP-based platform for AI & BI Applications. The transaction includes issuing ADS's representing 44.6% of XTL's share capital and additional warrants for reaching financial milestones. The investment is supported by a private placement of $1.5 million, conditioned on shareholder approval. Social Proxy will operate as a fully-owned subsidiary, with its shareholders appointing two representatives to XTL's board of directors. The completion of the transaction is subject to negotiation of definitive agreements, due diligence, shareholder approval, and necessary approvals.
Positive
  • Acquisition of THE SOCIAL PROXY expands XTL's IP portfolio for AI & BI Applications.
  • Transaction includes issuing ADS's representing 44.6% of XTL's share capital and additional warrants.
  • Private placement of $1.5 million secured to support the acquisition.
  • Social Proxy to operate as a fully-owned subsidiary, with its shareholders appointing two representatives to XTL's board of directors.
Negative
  • None.

Insights

The proposed acquisition of The Social Proxy by XTL Biopharmaceuticals represents a strategic move to diversify and bolster XTL's asset portfolio with technology that has the potential to tap into the rapidly growing AI and BI applications market. This investment indicates XTL's intent to capitalize on the increasing demand for ethical data extraction and proxy services, which are becoming more critical as businesses seek to leverage big data for competitive advantage.

From a market research perspective, the integration of The Social Proxy's technology could provide XTL with a competitive edge in AI Web Data, a niche but expanding sector. The decision to acquire a majority stake and integrate Social Proxy's board members suggests a long-term commitment to this new direction. However, investors should monitor the company's ability to integrate this technology and realize synergies, as well as the actual performance against the financial milestones tied to the additional warrants issued.

XTL's investment structure in The Social Proxy, involving a mix of equity and warrants, reflects a financing approach that aligns the interests of both XTL and Social Proxy's shareholders. The issuance of ADS's representing 44.6% of XTL's post-transaction share capital, combined with the payment of US$430,000, suggests a valuation of Social Proxy that investors should examine closely. The subsequent private placement of US$1.5 million, with unit warrants exercisable at US$1.20, further dilutes current shareholders but provides additional capital that is necessary to support the transaction and future growth.

Investors should be aware of the implications of shareholder dilution and the potential impact on earnings per share. Furthermore, the involvement of a significant shareholder and director in the private placement raises questions about potential conflicts of interest, which should be scrutinized alongside the transaction's terms.

The completion of the acquisition is contingent upon several legal and regulatory hurdles, including shareholder approval, due diligence and the negotiation of definitive agreements. These steps are standard in such transactions and are designed to protect the interests of all parties involved, including minority shareholders. The requirement for shareholder approval, particularly given the involvement of a major shareholder in the financing, is an important governance step to ensure transparency and fairness.

Investors should pay attention to the outcomes of these processes, as they can significantly affect the timeline and final terms of the deal. The addition of Social Proxy's representatives to XTL's board could also introduce new dynamics in governance and decision-making that stakeholders should consider.

expands its IP portfolio to AI Web Data

The Social Proxy is a web data AI company
developing and powering an IP based platform
for AI & BI Applications at scale

Secured $1.5 Million in a Private Placement

RAMAT GAN, ISRAEL, March 20, 2024 (GLOBE NEWSWIRE) --  XTL Biopharmaceuticals Ltd. (the “Company” or “XTL”) announced today that it has entered into a binding term sheet with THE SOCIAL PROXY Ltd., (the “Social Proxy”) a cutting edge web data company, developing and powering a unique ethical, IP based, proxy and data extraction platform for AI & BI Applications at scale (the “Term Sheet”).

Pursuant to the Term Sheet, the Company will acquire all of the issued and outstanding share capital of Social Proxy on a fully diluted basis (the “Transaction”) in exchange for the issuance by the Company to the shareholders of the Social Proxy, by way of a private placement, such number of ADS’s of the Company, representing immediately after such issuance, 44.6% of the issued and outstanding share capital of the Company and the payment of US$430,000 to the shareholders of the Social Proxy.

In addition, as part of the Transaction, the shareholders of Social Proxy will be issued additional warrants, which may only be exercised upon reaching certain financial measured milestones within a period of up to three (3) years from the closing of the Transaction.

The proposed Transaction is part of the Company’s strategy to expand its assets portfolio with high potential assets.

In order to support the Company’s financial needs and in order to complete the Transaction, the Company has secured a commitment of an investment at an amount of US$1,500,000 through a private placement to be consummated upon the closing of the Transaction (the “Private Placement”). In exchange for the investment in the Private Placement, the investors will be issued 1,500,000 units consisting of one ADS and one warrant, such warrant may be exercised during a period of five years from its issuance into one ADS at an exercise price of US$1.20 per warrant. The Investment is conditioned upon obtaining shareholders’ approval as Mr. Alexander Rabinovich, a 23.5% shareholder and a director of the Company, is one of the investors in this Private Placement.

Social Proxy will operate as fully owned subsidiary of the Company and its shareholders will be entitled to appoint two (2) representatives to the Company’s board of directors out of a total of up to seven (7) directors.

The completion of the Transaction is subject to negotiation of definitive agreements, containing representations, warranties and covenants as well as the satisfaction of various conditions required prior to closing, all as are customary for transactions of this nature, including, without limitation, the satisfaction of the Company, in its sole discretion, of a due diligence into Social Proxy, the approval of the Transaction by the Company’s shareholders and receipt of necessary government or third-party approvals, if required.

Shlomo Shalev, CEO of XTL commented: “We are pleased to add the Social Proxy into our asset portfolio and believe that it will add great value to our company and shareholders. In our search for new IP based assets to XTL we have identified the AI Web Data as a high growth market and we are actively looking for additional assets. We are excited to add the Social Proxy technology to XTL.

Tal Kinger, CEO of The Social Proxy commented: “We are thrilled to become part of the XTL team and are confident that working under XTL and its management will accelerate our growth and value creation”. 

About XTL Biopharmaceuticals Ltd. (XTL) 

XTL is an IP portfolio company. The company has IP surrounding hCDR1 for the treatment of Lupus disease (SLE) and Sjögren’s Syndrom (SS) and has decided, to explore collaboration with a strategic partner in order to execute the clinical trials. In parallel, the Company is actively looking to expand and identify additional IP based assets. 

XTL is traded on the Nasdaq Capital Market (NASDAQ: XTLB) and the Tel Aviv Stock Exchange (TASE: XTLB.TA).

About THE SOCIAL PROXY LTD.

The Social Proxy is a web data AI company, developing and powering, a unique ethical, IP based, proxy data extraction platform for AI & BI Applications at scale.

Social Proxy’s self-developed, innovative, next-generation proxy technology with unlimited IPs, and 100x faster than any other solution at the market that DOES NOT source other user IPs (the only real ethical solution in the market).

https://thesocialproxy.com

Cautionary Note Regarding Forward-Looking Statements

This communication contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Any statements contained in this communication that are not statements of historical fact may be deemed forward-looking statements. Words such as “continue,” “will,” “may,” “could,” “should,” “expect,” “expected,” “plans,” “intend,” “anticipate,” “believe,” “estimate,” “predict,” “potential,” and similar expressions are intended to identify such forward-looking statements. All forward-looking statements involve significant risks and uncertainties that could cause actual results to differ materially from those expressed or implied in the forward-looking statements, many of which are generally outside the control of the Company and are difficult to predict. Examples of such risks and uncertainties include, but are not limited to, whether to the Company will be able to negotiate and enter into the definitive agreements with respect to the Transaction, whether all conditions precedent in such definitive agreements will be satisfied, whether the closing of such Transaction will occur and whether the Company will achieve its goals. Additional examples of such risks and uncertainties include, but are not limited to (i) the Company’s ability to successfully manage and integrate any joint ventures, acquisitions of businesses, solutions or technologies; (ii) unanticipated operating costs, transaction costs and actual or contingent liabilities; (iii) the ability to attract and retain qualified employees and key personnel; (iv) adverse effects of increased competition on the Company’s future business; (v) the risk that changes in consumer behavior could adversely affect the Company’s business; (vi) the Company’s ability to protect its intellectual property; and (vii) local, industry and general business and economic conditions. Additional factors that could cause actual results to differ materially from those expressed or implied in the forward-looking statements can be found in the most recent annual report on Form 20-F and current reports on Form 6-K filed by the Company with the Securities and Exchange Commission. The Company anticipates that subsequent events and developments may cause its plans, intentions and expectations to change. The Company assumes no obligation, and it specifically disclaims any intention or obligation, to update any forward-looking statements, whether as a result of new information, future events or otherwise, except as expressly required by law. Forward-looking statements speak only as of the date they are made and should not be relied upon as representing the Company’s plans and expectations as of any subsequent date.

For further information, please contact:

Investor Relations, XTL Biopharmaceuticals Ltd.

Tel: +972 3 611 6666
Email: info@xtlbio.com
www.xtlbio.com


FAQ

What is the purpose of XTL acquiring THE SOCIAL PROXY ?

XTL aims to expand its IP portfolio for AI & BI Applications through the acquisition.

How much was secured through the private placement for the acquisition?

$1.5 million was secured through the private placement for the acquisition.

What percentage of XTL's share capital will be represented by the issued ADS's?

The issued ADS's will represent 44.6% of XTL's share capital.

What is the condition for the $1.5 million private placement investment?

The investment is conditioned on obtaining shareholder approval.

How will Social Proxy operate within XTL after the acquisition?

Social Proxy will operate as a fully-owned subsidiary of XTL.

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Ramat Gan