Battery Road Capital Corp. Provides Updates Respecting Proposed Qualifying Transaction
Battery Road Capital Corp. Provides Updates
Respecting Proposed Qualifying Transaction
Halifax, Nova Scotia--(Newsfile Corp. - June 2, 2021) - Battery Road Capital Corp., (TSXV: BTRY.P)
("
Battery Road
"), a capital pool company listed on the TSX Venture Exchange (the "
TSXV
"), is pleased
to provide an update on its previously announced share exchange agreement dated as of October 10,
2020 (the "
Definitive Agreement
") with E-Tech Kalapuse Mining (Pty) Ltd. ("
E-Tech Namibia
") and the
holders of all of the outstanding shares of E-Tech Namibia (the "
E-Tech Namibia Parties
"), which
provides for the acquisition of all of the outstanding E-Tech Namibia Shares (the "
E-Tech Namibia
Shares
") by Battery Road and which will constitute the Qualifying Transaction (as such term is defined in
policy 2.4 of the TSXV of Battery Road (the "
CPC Policy
").
To give effect to the Definitive Agreement, parties will proceed to take several actions (collectively, the
"
Transactions
"), including:
1
.
Battery Road will conduct a concurrent financing subscription receipts (the "
Offering
") to convert
into post-split shares of Battery Road;
2
.
Battery Road will conduct a stock split and name change;
3
.
convertible debentures of E-Tech Namibia (the "
E-Tech Debentures
") will convert into ordinary
shares of E-Tech Namibia;
4
.
the exchange of shares contemplated in the Definitive Agreement and the additional shares of E-
Tech Namibia issued upon conversion of the E-Tech Debentures will occur (the "
Share
Exchange
");
5
.
subscription receipts issued under the Offering will convert into post-split shares of Battery Road;
and
6
.
Battery Road will enter into a post-transaction support and services agreement with Numus
Financial Inc. (the "
Services Agreement
").
The Transactions remain subject to all necessary regulatory approvals and other conditions which are
typical for a transaction of this type.
Extension Agreement
The parties to the Definitive Agreement have entered into an extension agreement dated March 31,
2021 increasing the amount of time parties have to complete the Transactions to June 30, 2021.
Amending Agreement
The parties to the Definitive Agreement have entered into an agreement dated June 2, 2021 amending
the Definitive Agreement in several ways, including:
1
.
the Concurrent Private Placement (the "
Offering
") will now be increased and conducted by Battery
Road through the issuance of subscription receipts outlined below as opposed to a financing
conducted by offering shares of E-Tech Namibia;
2
.
the parties now contemplate the completion of a stock split (the "
Split
"), on the basis of 2 post-split
common shares of Battery Road ("
Post-Split Shares
") for every 1 pre-split common share of
Battery Road ("
Pre-Split
Shares
"); and,
3
.
the exchange ratio of the Share Exchange will be adjusted for the Split such that each ordinary
share of E-Tech Namibia shall convert into 111,111 Post-Split Shares.
Concurrent Private Placement -Subscription Receipt Financing
Battery Road has entered into an engagement (the "
Offering Engagement
") with Numus Capital Corp.
(the "
Agent
"), a subsidiary of Numus Financial, to complete the Offering of subscription receipts issued
by Battery Road at a price of $0.25, each convertible into one Post-Split Share, subject to adjustment if
the Split does not occur. Up to 20,000,000 subscription receipts will be offered on a "best efforts" private
placement basis for aggregate gross proceeds to Battery Road of up to $5,000,000 in connection with
the Share Exchange, assuming the full exercise at or before closing of the Offering of the over-allotment
option described below. The minimum gross proceeds of the Offering will be $2,000,000.
Under the Offering Engagement, Battery Road has granted to the Agent an over-allotment option
exercisable in whole or in part by the Agent at any time up to the closing date of the Offering in an
amount of 4,000,000 Subscription Receipts. If the over-allotment option is exercised in full, the total
gross proceeds of the private placement of Subscription Receipts will be $5,000,000.
The Subscription Receipts will be issued pursuant to a subscription receipt agreement to be entered into
among Battery Road and Computershare Trust Company of Canada (the "
Escrow Agent
"), in its
capacity as escrow agent thereunder. The specific attributes of the Subscription Receipts shall be set
forth in the subscription receipt agreement.
On the closing of the Offering, the gross proceeds raised in connection with the Offering including any
fees owed to the Agent, will be held in escrow on behalf of the subscribers by the Escrow Agent in
investments that may be approved by the Agent, (the "
Escrowed Funds
").
The Escrowed Funds (less the fees and any expenses payable by Battery Road to the Agent) will be
released to Battery Road upon receipt by the Escrow Agent of a written joint notice of Battery Road and
E-Tech Namibia stating that the Share Exchange contemplated in the Definitive Agreement has closed,
at which time each Subscription Receipt shall automatically be exchanged for Post-Split Shares.
If the Transactions are not completed by 5:00 p.m. (Halifax time) on December 31, 2021 or such later
date as Battery Road and the Agent may agree in writing or if, prior to such time, Battery Road advises
the Agent in writing or announces to the public that it does not intend to satisfy the escrow release
conditions outlined in the Subscription Receipt Agreement, and unless the requisite approval is
obtained, all of the issued and outstanding Subscription Receipts will be cancelled and the Escrow
Agent will return to each holder of Subscription Receipts, an amount equal to the Subscription Price for
the Subscription Receipts held by such holder plus a
pro rata
share of any interest or other income
earned on the Escrowed Funds (less applicable withholding tax, if any). To the extent that the Escrowed
Funds are insufficient to refund each holder of Subscription Receipts, Battery Road shall be liable for
and will contribute such amounts as are necessary to satisfy any shortfall.
In connection with the Offering Engagement, the Agent will receive, conditional upon closing of the Share
Exchange (a) a cash commission equal to 7.0% of the aggregate gross proceeds raised by Battery
Road from the sale of any Subscription Receipts in connection with the Offering; and (b) such number of
convertible compensation warrants entitling the Agent to purchase that number of Post-Split Shares in
Battery Road equal to seven percent (7%) of the Subscription Receipts in the Offering, with conversion
terms adjusted if the Split does not occur. This is expected to equate to 1,400,000 Post-Split Shares
after exercise of the warrants, assuming exercise in full of the over-allotment option. The compensation
warrants may be exercised for a period of 24 months after the closing of the Transactions.
The proceeds of the Offering will be used after completion of the Transactions to facilitate exploration
activities at the Eureka neodymium and praseodymium project, located in central west Namibia, and for
general working capital purposes.
Loans Provided by Numus Financial and Other Parties to E-Tech Namibia
In order to satisfy certain financial obligation and to advance its exploration plans in advance of closing
the Transactions E-Tech Namibia Parties entered into the unsecured, convertible E-Tech Debentures
bearing interest annually at a rate of 12% that are convertible into ordinary shares of E-Tech Namibia at
a rate of $12,000 per ordinary share.
Under these debentures E-Tech Namibia is expected to have been
loaned by the closing of the Transactions, in aggregate, up to $1,500,000 with an estimated $60,000 in
accrued interest. The E-Tech Debentures, including interest, if converted on the date of this press
release, would convert into an aggregate of approximately 130 ordinary shares of E-Tech Namibia, and,
upon completion of the Split, would equate to 14,444,444 Post-Split Shares of Battery Road. This
equates to a deemed price per Post-Split Share received under the E-Tech Debentures of $0.108.
A portion of the E-Tech Debentures are expected to be outstanding with non-arm's length parties to
Battery Road at the closing of the Transactions. An estimate of the expected outstanding E-Tech
Debentures at closing follows:
Holder
Principal Amount
Estimated Interest
Accrued
(1)
Equivalent E-Tech
Namibia Ordinary
Shares (including
estimated converted
interest)
Equivalent Post-Split
Shares of Battery Road
(including estimated
converted interest)
Deemed price per Post-
Split Share
Wade Dawe
(
2)
$245,000
$9,800
21
2,359,259
$0.108
James Megann
(3)
$105,000
$4,200
9
1,011,111
$0.108
Numus Financial
$605,000
$24,200
52
5,825,926
$0.108
Daniel Whittaker
(
4
)
$100,000
$4,000
9
962,963
$0.108
Evan Dawe
(5)
$35,000
$1,400
3
337,037
$0.108
Other Arm's Length
Holders
$410,000
$16,400
36
3,948,148
$0.108
Total
$1,500,000
$60,000
130
14,444,444
$0.108
Notes:
1
.
Actual amount of interest, and therefore Post-Split Shares ultimately received by each debenture holder, and price per Post-Split Share
will vary depending on the date of conversion of the E-Tech Debentures.
2
.
Includes debentures held by Associated family members not listed individually and Affiliate, Brigus Capital Inc.
3
.
Includes debentures held by Affiliate John St. Capital Inc.
4
.
Includes debentures held by Affiliate Birchpoint Holdings Incorporated.
5
.
Related party to Numus Financial.
There is no finder's fee or commission payable by E-Tech Namibia or Battery Road with respect to the
E-Tech Debentures.
Approximately $210,750 of the E-Tech Debentures will assist in restructuring existing debt of E-Tech
Namibia, $238,000 will be used to repay shareholder loans of shareholders of E-Tech Namibia, with
remaining amounts providing funding exploration activities.
Share Split
Battery Road shall conduct the Split and Share Exchange such that the E-Tech Namibia Parties will
receive Post-Split Shares (or equivalent amounts of Pre-Split Shares) and the Subscription Receipts (as
defined below) issued in the concurrent financing, will subject to their terms, convert into Post-Split
Shares, (or equivalent amounts of Pre-Split Shares) as well.
Effect of Transactions on Shares of Battery Road
The outstanding shares of Battery Road will be affected by the Transactions as follows:
Currently outstanding shares (adjusted for the Split)
25,971,500
Post-Split Shares issuable on conversion of the E-Tech Debentures (including estimated interest to be converted)
14,444,444
Post-Split Shares issuable to E-Tech Namibia Parties pursuant to the Share Exchange
22,222,223
Post-Split Shares issuable on conversion of the subscription receipts in the Concurrent Private Placement
20,000,000
Total
82,638,167
This equates to a deemed amount of proposed consideration for the E-Tech Namibia Shares (including
the convertible debentures and estimated interest after conversion) equal to, in aggregate, 36,666,667
Post-Split Shares, or 111,111 Post-Split Shares for each outstanding ordinary share of E-Tech Namibia.
Each share of E-Tech Namibia is valued at $12,000, which equates to a deemed price per Post-Split
Share of $0.108.
Other than the fees disclosed with respect to the Agent in the Offering, there are no finder's fees or
commissions in relation to the Transactions.
Identification of any interest of Non-Arm's Length Parties to the CPC
Numus Financial has an interest in the Transactions through (i) E-Tech Debentures, which will convert to
shares of E-Tech Namibia which will, in turn, be exchanged for shares of Battery Road; (ii) Offering
Engagement of its subsidiary as Agent; and (iii) the Services Agreement it will enter with the Battery
Road. James Megann, a director and shareholder of Battery Road, is a director, officer and minority
shareholder of Numus Financial. Wade Dawe, a shareholder of Battery Road, is a director, officer and
minority shareholder of Numus Financial.
Daniel Whittaker, Director of Battery Road, is the holder of E-Tech Debentures and is indirectly a
subscriber in the Offering through Birchpoint Holdings Incorporated.
Certain subscribers in the Offering are related parties or insiders to Battery Road making up
approximately 11% of the Offering:
Insider/Related Party
Amount of Subscription
Receipts
Price ($)
Percent of Offering
Equivalent Post-Split
Shares of Battery Road
Percent of Battery
Road after Completion
of Transactions
Garry Stewart
80,000
20,000
0.4%
80,000
0.1%
Torrent Capital
Limited
(1)
1,200,000
300,000
6.0%
1,200,000
1.5%
James Megann
(2)
24,960
6,240
0.1%
24,960
0.0%
Dan Whittaker
(3)
800,000
200,000
4.0%
800,000
1.0%
Total
2,104,960
526,240
10.5%
2,104,960
2.6%
Notes:
1
.
Related party to Battery Road as a result of common ownership.
2
.
Subscription by John St. Capital Inc. James Megan controls John St. Capital Inc.
3
.
Subscription by Birchpoint Holdings Incorporated. Daniel Whittaker controls Birchpoint Holdings Incorporated.
The Share Exchange does not constitute a "Non-Arm's Length Qualifying Transaction" as that term is
defined under TSXV policies.
Shareholder Approval
Battery Road will be seeking special shareholder approval for the Split and the name change. Battery
Road will also be seeking disinterested shareholder approval of E-Tech Debentures, which will convert
to shares of E-Tech Namibia which will, in turn, be exchanged for shares of Battery Road; (ii) the Offering
Engagement; and (iii) the Services Agreement.
Participation of related parties in the Offering fall below
the threshold for shareholder approval under applicable securities laws. Battery Road is relying upon an
exemption for shareholder approval required for the Offering under section 5.7(1)(b) of Multilateral
Instrument 61-101
Protection of Minority Security Holders in Special transactions
("
MI-61-101
") on the
basis that the fair market value of the securities purchased by interested parties to the Offering is not
more than $2,500,000 and the Offering has been approved by the independent director of Battery Road.
Further details of the Transactions, including a description of the background, review, and approval
process at Battery Road, and specific uses of proceeds of the Offering will be contained in a
management information circular to be sent to shareholders and made available via online in connection
with the meeting to be called to approve elements of the Transactions.
Two elements of the Transaction (the Offering and Offering Engagement) are expected to be completed
prior to 21 days from the date of this press release, provided however that funds from the Offering
including compensation owing to the Agent under the Offering Engagement are placed in escrow only to
be released contingent on closing of Qualifying Transaction, failing which proceeds of the Offering shall
be returned to subscribers under the terms of the Subscription Receipt Agreement among Battery Road,
the Agent, and Computershare Trust Company of Canada.
Valuation Exemption
Battery Road is relying upon the exemption from formal valuation requirements with relation to a related
party transaction under section 5.5(b) of MI 61-101 because no securities of Battery Road are listed or
quoted on specified markets outlined in that section of MI 61-101.
Insiders
Following completion of the Share Exchange, the following persons will be insiders:
John Philpott - Director
As president and CEO of Canabo Medical Corp, John led the executive team through a successful
public listing for Canabo followed by managing the merger of Canabo with Aleafia Health Inc. in a
transaction valued at $40 million resulting in combined operation with a market cap over $200 million at
the close of the merger. Canabo was a venture backed company with the objective of becoming a
leading clinic operation in Canada for the education of physicians, diagnosis and prescription fulfillment
for medical marijuana patients; and to develop a leading patient research database to support the
proliferation of medical marijuana products. In less than two years, he scaled the company from one
Toronto clinic with two part-time physicians to 24 clinics across Canada, 140 recruited physicians
supported by a national call center.
CanAm has been a leading physician recruitment and placement company in the Canadian and
international markets for over 20 years. As CEO of CanAm Physician Recruiting, Inc., John consults with
physicians, hospital administrators, government officials, and private clinic owners John and his
associate recruiter staff have successfully placed and managed career transitions for over thousands of
doctors. CanAm continues to thrive with a focus on the Canadian market.
Born and raised in Newfoundland, John graduated from Memorial University in St. John's NFLD with a
Bachelor in Mechanical Engineering in 1995 after completing a three-year Petroleum Engineering
Technology program at the Cabot Institute of Applied Engineer Science. He worked as an engineer in
Canada, the U.S., and overseas before founding CanAm Physician Recruiting Inc. in 1997.
In 2013, John became a member of Canadian Management Consultant (CMC) and obtained
certification through the Executive stream in 2014. John is an active volunteer serving on numerous
boards and executive committees such as CMC Atlantic Canada chapter, the Halifax Club (the oldest
business club in North America), East Hants Sportsplex (a $22-million facility) and Oakfield Golf &
Country Club. In his leisure time, John is an avid outdoorsman who enjoys golf, fly fishing, hunting and
cooking.
Chris Drysdale - Director
Mr. Drysdale is an experienced professional with international experience in the mineral and exploration
industry and currently serves as Vice-President Operations and Corporate Development for Antler Gold
Inc., a gold exploration company focused on the acquisition and exploration of gold projects in Namibia.
He has previously served as the Kenyan Country Manager for Stockport Exploration Inc., overseeing the
operations for all aspects of its gold exploration and production activities throughout East Africa. Prior to
that, Mr. Drysdale worked as a Field Exploration Geologist for Remote Exploration Services (Pty) Ltd., a
geological consulting firm based out of South Africa servicing all aspects of the mineral industry. Mr.
Drysdale has a progressive and diverse background with extensive work experience in Namibia, and
has been involved in various mineral projects throughout Africa.
Mr. Drysdale received a BSc in 2010 and is currently enrolled in an MBA program at the University of
Stellenbosch.
Daniel Whittaker - Director
Mr. Whittaker is the current CEO of Antler Gold Inc. and has held senior positions in the mineral industry
for the last 20 years. Most recently, he was a founder of GoGold Resources Inc., a mineral exploration,
development and production company. Daniel held senior management positions with GoGold from
January 2008 to January 2016 and also served as a director of GoGold from inception to January 2013.
He founded Ucore Rare Metals Inc. in 2006 and served as an officer and director to March 2008.
Mr. Whittaker holds a Bachelor of Arts in Economics Degree and a Masters of Business Administration
from the Richard Ivey School of Business at the University of Western Ontario. He also has held the
Chartered Financial Analyst designation from the CFA Institute since 1995.
Ken Marshall - Director
Ken Marshall has extensive experience in the Information Technology and Telecommunications Sectors,
having served in various positions at Rogers Communications throughout his career.
Mr. Marshall was
the Senior VP, National Residential Marketing (Toronto) where he led the Wireline Marketing Group in
the launch of the Ignite platform, and also served as the Regional President (Atlantic Region) and the
Vice President - Enterprise Business Unit.
Mr. Marshall has spent his post telecom time working with emerging start-up organizations, and serves
on the Boards of Genesis, Newfoundland and Labrador's primary innovation hub and incubator;
Celtx, an
online platform for film, video and game production;
eXeBlock Technology Corporation focusing on
opportunities in digital identity and authentication; and Metricsflow, a B2B platform to significantly
enhance website attribution.
Mr. Marshall obtained a Bachelor of Commerce (Hons.) from Memorial University in 1984 and a Masters
Business Administration (Finance) from Dalhousie University in 1985.
Edward Loye - Director
Mr. Loye has worked on the characterization of Rare Earth Element deposits for 8 years, notably in
Namibia and as a member of staff at Camborne School of Mines, University of Exeter, UK.
Ed has
developed an extensive network across the REE supply chain and played a key role in securing £2.7
million in 2014 from the UK Government for REE research within the Security of Supply RARE
Programme. Mr. Loye managed the academic and industrial collaborators across this international
consortium of REE experts.
In 2015, he co-founded E-Tech Metals to pursue and strategize the geological delineation and
prospectivity of the Eureka Project in Namibia. Mr. Loye has since instigated metallurgical test work and
managed the drilling and trenching campaigns on site.
Mr. Loye completed a BSc Applied Geology at the University of Plymouth, UK in 2000, a MSc Mining
Geology in 2012 and a Masters by Research MRES in 2013 at the Camborne School of Mines,
University of Exeter, UK.
Mr Loye is a Fellow of the Geological Society of London FGA and a Master of
Camborne School of Mines MCSM.
Elbert Loois- Chief Executive Officer
Elbert brings over 20 years of management and consulting experience for business development, M&A,
and sustainable supply strategy within the raw materials, automotive, and clean technology industries. He
has extensive experience in developing sustainable supply and off taking strategies. He has worked with
international OEMs and tier 1 suppliers to develop critical material supply strategies.
He has been responsible for the portfolio management of international mining projects at RWE Power
and has also served as CEO of the largest German mining consulting company, DMT-IMC. Furthermore,
he worked as a senior mining engineer in opencast mining and underground projects and as R&D
manager for operational mining technology.
Elbert completed an MBA from Alliance Manchester Business School in 2009, Additionally, he holds a
Master of Science degree in Mining Engineering from Delft University of Technology in the Netherlands.
Rob Randall - Chief Financial Officer and Secretary
Mr. Randall has served as a contract CFO for a number of TSXV-listed companies and has extensive
public company financial experience. Rob currently serves as the Chief Financial Officer of Torrent
Capital, Sona Nanotech, Antler Gold Inc. and eXeBlock Technology Corporation. Rob was the
Corporate Controller of Etruscan Resources Inc. from 1997 to 2011 overseeing the financial operations
for all aspects of its gold exploration and production activities throughout West Africa, as well as its
diamond operations in South Africa and resource exploration in Namibia. He also served as Controller
of Nova Gold Resources Inc. from 1997 to 2001.
Rob graduated with a Commerce Degree from St. Mary's University in Halifax and obtained his CA
designation in 1987 with Coopers and Lybrand where he was appointed as a Principal in 1995. He is a
member of CPA Canada and the Chartered Professional Accountants of Nova Scotia. Rob is active in
his community as a Board member and Past Chair and Treasurer of the Nova Scotia Sport Hall of
Fame.
Sponsor
Sponsorship of a Qualifying Transaction is required by the TSXV unless exempt or waived in
accordance with the CPC Policy. Battery Road intends to apply for a waiver from the sponsorship
requirements pursuant to the policies of the TSXV, however, there is no assurance that a waiver will be
provided.
Transition to new Policy 2.4
Due to changes recently announced by the TSXV to its Capital Pool Company program and changes to
the CPC Policy, which become effective as at January 1, 2021 (the "
New CPC Policy
"), Battery Road
intends to implement certain amendments to align with the New CPC Policy.
Pursuant to the New CPC Policy, Battery Road will be seeking approval at its special meeting of
shareholders scheduled to be held on June 29, 2021 (the "
Meeting
") for the following matters: (i) to
remove the consequences of failing to complete a Qualifying Transaction within 24 months of Battery
Road's date of listing on the TSXV (the "
Listing Date
"); and (ii) to amend the escrow release conditions
and certain other provisions of Battery Road's Escrow Agreement (the "
Escrow Agreement
"). These
proposed amendments are described in further detail below. All other matters outlined in this press
release will be brought forward at a subsequent shareholder meeting yet to be scheduled.
Removal of the Consequences of Failing to Complete a QT within 24 Months of the Listing Date
Under the Exchange's Policy 2.4 - Capital Pool Companies (as at June 14, 2010) (the "
Former Policy
")
there are certain consequences if a Qualifying Transaction is not completed within 24 months of the
Listing Date. These consequences include a potential for the common shares of Battery Road to be
delisted or suspended, or, subject to the approval of the majority of Battery Road's shareholders,
transferring Shares to list on the NEX; and, cancelling certain seed shares. The New CPC Policy has
removed these consequences if disinterested shareholder approval is obtained. Battery Road intends to
ask disinterested shareholders to approve the removal of such consequences at the Meeting, as it
believes that it will afford Battery Road greater flexibility to complete a Qualifying Transaction that is
beneficial to all interested parties, and will also allow Battery Road to better withstand market volatility.
Amendments to the Escrow Agreement
Battery Road intends to ask disinterested shareholders to approve Battery Road making certain
amendments to the Escrow Agreement, including allowing Battery Road's escrowed securities to be
subject to an 18 month escrow release schedule as detailed in the New CPC Policy, rather than the
current 36 month escrow release schedule in the Former Policy.
In addition, Battery Road wishes to amend the Escrow Agreement such that all options granted prior to
the date the TSXV issues a final bulletin for the Qualifying Transaction ("Final QT Exchange Bulletin")
and all shares that were issued upon exercise of such options prior to the date of the Final QT Exchange
Bulletin will be released from escrow on the date of the Final QT Exchange Bulletin, other than options
that (a) were granted prior to the IPO with an exercise price that is less than the issue price of the shares
issued in the IPO and (b) any shares that were issued pursuant to the exercise of such options, which will
be released from escrow in accordance with the 18 month escrow release schedule as detailed in the
New CPC Policy.
Trading Halt
Trading in the common shares of Battery Road are presently suspended and will remain so until the
Transactions are completed and approved by the TSXV.
About Battery Road Capital Corp.
Battery Road is a Capital Pool Company listed on the TSX Venture Exchange. Its principal business is
the identification and evaluation of assets or businesses with a view to completing a qualifying
transaction. Battery Road has not commenced commercial operations and has no assets other than
cash.
For further information please contact:
Jim Megann, Director
Battery Road Capital Corp.
902-442-7192
Completion of the Transactions is subject to a number of conditions, including but not limited to,
TSXV acceptance and if applicable pursuant to TSXV Requirements, majority of the minority
shareholder approval. Where applicable, the transaction cannot close until the required shareholder
approval is obtained. There can be no assurance that the transaction will be completed as proposed
or at all. Investors are cautioned that, except as disclosed in the management information circular or
filing statement to be prepared in connection with the Transactions, any information released or
received with respect to the Transactions may not be accurate or complete and should not be relied