LeoNovus continues talks for precious metals exchange

Executive Summary

• LeoNovus Inc. provided a business update on the development of its institutional-grade precious metals exchange, stating that platform development is substantially complete and the company is moving toward final system testing and commercial launch.
• The company terminated its previously announced share purchase agreement with Wellfield Technologies Inc. regarding the acquisition of Tradewind Markets Inc., citing that the acquisition was no longer strategic to the exchange's launch.
• Trading of LeoNovus shares on the TSX Venture Exchange remains halted pending the lifting of conditions related to the terminated Tradewind transaction.

Key Details

• Exchange Development: The platform utilizes a permissioned blockchain ledger for trading and settling physical assets. Each digital token represents a one-for-one ownership of physical gold or silver ounces held in regulated Canadian custodian vaults.
• Technology: The exchange features a high-performance transaction engine for rapid settlement and includes a user-financed automated market-maker (AMM) liquidity pool to ensure continuous market depth without the company acting as a counterparty.
• M&A Termination: On Dec. 3, 2025, LeoNovus terminated the share purchase agreement with Wellfield Technologies Inc. for the proposed acquisition of Tradewind Markets Inc.
• Strategic Pivot: CEO Michael Gaffney stated that independence allows the company to focus exclusively on partnerships and regulatory approvals required for the exchange launch.
• Next Steps: The company is engaged in advanced discussions with strategic partners regarding inventory, liquidity, and operational components. Financing and final system testing are planned for the winter, with a commercial launch subject to regulatory approvals.
• Trading Halt: Trading on the TSX Venture Exchange was halted in conjunction with the Tradewind transaction. LeoNovus is working to fulfill TSX-V conditions to lift the halt.
• Loan Amendment: A loan agreement with two directors, originally maturing Aug. 3, 2025, was amended to extend the maturity date and warrant expiry to Aug. 3, 2026. This is a related party transaction subject to TSX-V approval.
• Regulatory Risks: The platform requires registrations and/or exemptive relief from Canadian securities regulators for features like peer-to-peer trading. There is no assurance these approvals will be obtained, which could have a material adverse effect on the business.

Notable Quotes

• "Our independence allows us to focus exclusively on the partnerships and regulatory approvals required for a successful launch," said Michael Gaffney, chair and chief executive officer. "We are applying years of experience in quantum-secure storage and distributed trust models to an asset class where integrity is paramount."