VANCOUVER, British Columbia, Jan. 31, 2019 (GLOBE NEWSWIRE) -- DMG Blockchain Solutions Inc. (TSX-V: DMGI) (DMGGF:OTC US) (FRANKFURT:6AX) (“DMG”or the “Company”), a diversified blockchain and cryptocurrency company, announces that it has not been able to file the Company’s annual audited financial statements and accompanying MD&A for the year ended September 30, 2018 (the “Required Filings”) by the filing deadline of January 28, 2019 and, as such, is in default under applicable securities legislation.
MNP LLP resigned as the auditor (the “Auditor”). The British Columbia Securities Commission can impose a cease trade order that all trading in securities of the Company cease for such period of time as the Principal Regulator may deem appropriate.
During this time period, the Company would like to assure its shareholders, partners, customers, and employees that while the board of directors will be focused on appointing a new auditor to ensure timely filing of the Required Filings, it will continue to operate in the normal course of business.
The Company's Required Filings will be made as soon as the board of directors has approved the financial statements and its new auditors have delivered their final audit report.
Auditor Resignation
On January 28, 2019, the Company’s auditor resigned. In a follow-up discussion on January 28, 2019, the Company requested that the Auditor provide the Company with sufficient detail surrounding its resignation. On January 30, 2019, the Company received additional details relating to the reasons behind the resignation. The auditor resigned due to receiving inconsistent information regarding operations and disclosures which caused them some concern and therefore they were unable to continue with the audit. The filings required under Section 4.11(5) of National Instrument 51-102- Continuous Disclosure Obligations (“NI 51-102”), will be made publicly available at www.sedar.com in accordance with Section 4.11(5) of NI 51-102.
The Auditor had advised the Company that there is a “reportable event” with respect to “unresolved issues”, as such terms are defined in NI 51-102 in connection with their resignation. The Company disagrees with some of the reasons for the unresolved issues, reasons for the resignation and facts presented by the Auditor. However, the Company acknowledges that it no longer has the working relationship with the Auditor required to complete the audit in a timely manner and so the resignation by the Auditor has been approved by the Board.
As a result of the resignation, the Company regrets that it has not filed the Required Filings for the period ended September 30, 2018 which were due on January 28, 2019. The Company will continue to provide regular updates to its shareholders and the regulators with respect to when such financial statements will be made available. The Company is currently in discussions with several audit firms and an update will be provided if and when new auditors are retained.
The Company also announces Danny Yang has resigned as a director of the Company but will remain DMG’s Chief Technology Officer.
About DMG Blockchain Solutions Inc.
DMG Blockchain Solutions Inc. is a diversified blockchain and cryptocurrency company that manages, operates and develops end-to-end solutions to monetize the blockchain ecosystem. DMG, with its Blockseer division located in Silicon Valley, intends to be the global leader in industrial scale crypto mine hosting – Mining as a Service (MaaS), crypto mining, blockchain forensics/analytics, and blockchain platform development.
For more information on DMG Blockchain Solutions visit: www.dmgblockchain.com
On behalf of the Board of Directors,
Daniel Reitzik, CEO & Director
For further information, please contact:
DMG Blockchain Solutions Inc.
Investor Relations: John Martin
Toll Free: 1-888-702-0258
Email: investors@dmgblockchain.com
Web: www.dmgblockchain.com
Direct: 778-868-6470
Cautionary Note Regarding Forward-Looking Information
This news release contains forward-looking information based on current expectations. Statements about the Company’s plans and intentions, other potential transactions, retaining a new auditor and making the necessary filings, acquisition of customers, product development, events, courses of action, and the potential of the Company’s technology and operations, among others, are all forward-looking information. Forward-looking statements consist of statements that are not purely historical, including any statements regarding beliefs, plans, expectations or intentions regarding the future. Such information can generally be identified by the use of forwarding looking wording such as “may”, “expect”, “estimate”, “anticipate”, “intend”, “believe” and “continue” or the negative thereof or similar variations. The reader is cautioned that assumptions used in the preparation of any forward-looking information may prove to be incorrect. Events or circumstances may cause actual results to differ materially from those predicted, as a result of numerous known and unknown risks, uncertainties, and other factors, many of which are beyond the control of the Company, including but not limited to, business, economic and capital market conditions; the ability to manage operating expenses, which may adversely affect the Company’s financial condition; the ability to remain competitive as other better financed competitors develop and release competitive products; regulatory uncertainties; access to equipment; market conditions and the demand and pricing for products; the demand and pricing of bitcoins; security threats, including a loss/theft of DMG’s bitcoins; DMG’s relationships with its customers, distributors and business partners; the inability to add more power to DMG’s facilities; DMG’s ability to successfully define, design and release new products in a timely manner that meet customers’ needs; the ability to attract, retain and motivate qualified personnel; competition in the industry; the impact of technology changes on the products and industry; failure to develop new and innovative products; the ability to successfully maintain and enforce our intellectual property rights and defend third-party claims of infringement of their intellectual property rights; the impact of intellectual property litigation that could materially and adversely affect the business; the ability to manage working capital; and the dependence on key personnel. DMG may not actually achieve its plans, projections, or expectations. Such statements and information are based on numerous assumptions regarding present and future business strategies and the environment in which the Company will operate in the future, including the demand for its products, the ability to successfully develop software, that there will be no regulation or law that will prevent the Company from operating its business, anticipated costs, the ability to achieve goals and the price of bitcoin. Given these risks, uncertainties and assumptions, you should not place undue reliance on these forward-looking statements.
The securities of DMG are considered highly speculative due to the nature of DMG’s business.
Factors that could cause the actual results to differ materially from those in forward-looking statements include, failure to obtain regulatory approval, the continued availability of capital and financing, equipment failures, lack of supply of equipment, power and infrastructure, failure to obtain any permits required to operate the business, the impact of technology changes on the industry, competition, security threats including stolen bitcoins from DMG or its customers, consumer sentiment towards DMG’s products, services and blockchain technology generally, failure to develop new and innovative products, litigation, increase in operating costs, increase in equipment and labor costs, failure of counterparties to perform their contractual obligations, government regulations, loss of key employees and consultants, and general economic, market or business conditions. Forward-looking statements contained in this news release are expressly qualified by this cautionary statement. The reader is cautioned not to place undue reliance on any forward-looking information.
The forward-looking statements contained in this news release are made as of the date of this news release. Except as required by law, the Company disclaims any intention and assumes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Additionally, the Company undertakes no obligation to comment on the expectations of, or statements made by, third parties in respect of the matters discussed above.
Neither the TSX Venture Exchange nor its Regulation Service Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this news release.