FingerMotion to Issue 7.33 Million Shares for Telforge Acquisition with Earnout Targets
FingerMotion will issue up to 7.33 million shares to acquire Telforge, including 2.33 million at closing and 5 million in escrow tied to $2.5 million and $5 million three- and six-month cumulative revenue earnouts. The transaction adds cloud-based voice, messaging and unified communications services and a U.S. operating model.
1. Transaction Terms
FingerMotion entered a share exchange agreement to acquire all outstanding shares of Telforge in exchange for up to 7,333,333 common shares. Upon closing, 2,333,333 shares will be released to Telforge shareholders and 5,000,000 will be held in escrow as restricted securities with registration rights.
2. Earnout Structure
The escrowed shares vest based on two earnout periods: 2,000,000 shares if Cumulative Revenue plus Secured Contract Value reaches $2,500,000 within three months of closing, and an additional 3,000,000 shares if it reaches $5,000,000 within six months. Unvested shares will be forfeited at the end of each period.
3. Strategic Impact
The acquisition brings Telforge’s cloud-based voice, messaging and unified communications solutions into FingerMotion’s portfolio, enabling monthly management of tens of millions of minutes via its switching platform. It also establishes a U.S. operating model, supporting geographic expansion and scalable revenue growth without significant hardware investment.