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Peak Positioning Technologies Inc. - August 2013
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Peak Positioning Technologies Inc. - August 2013

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Peak Positioning Technologies Inc. (TSXV: PKK) is a Canadian software developer for smartphones and other mobile computing devices, conducting business primarily in China and North America. ...

Peak Positioning Technologies Inc. (TSXV: PKK) is a Canadian software developer for smartphones and other mobile computing devices, conducting business primarily in China and North America.
In association with its partner, LongKey-Hong Kong Ltd (LongKey), the Company has developed the AiNi™ Mobile Cloud Platform. AiNi™ is an enhanced version of the Android O/S and comes with a suite of applications including IM (instant messaging) aggregation, group chat, calendar and contacts synchronization, automated device configuration and several important security features.
LongKey markets AiNi™ along with its Software as a Service (SaaS) and E-commerce solutions in China through its partnerships with major Chinese telecommunication companies and banks, while Peak markets AiNi™ along with its own applications in markets outside of China.
Peak is developing its business along two parallel growth paths:
(i) Establish distribution partnerships for AiNi™ with telecom providers outside of China
(ii) Continue to develop opportunities for AiNi™, SaaS, and E-commerce in China through its association with LongKey.

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    Peak Positioning Technologies Inc. - August 2013 Peak Positioning Technologies Inc. - August 2013 Presentation Transcript

    • Positioned at the Peak of Wireless Solutions TSX Venture: PKK August 2013
    • Disclaimer  This presentation includes forward-looking statements about Peak Positioning Technology Inc., including its business operations, strategy and expected financial performance and condition. In addition, any statements that may be made concerning future financial performance (including revenues, earnings and growth rates), ongoing business strategies and prospects, and possible future action on the Corporation’s part, are also forward-looking statements and reflect our current beliefs and are based on information currently available to us and on assumptions we believe are reasonable. Actual results and developments may differ materially from the results and developments discussed in the forward-looking statements as they are subject to a number of significant risks and uncertainties which can be beyond our control. The reader is cautioned to consider these and other factors carefully and not place undue reliance on forward-looking statements. We are under no obligation (and expressly disclaim such obligation) to update or alter the forward-looking statements whether as a result of new information, future events or otherwise unless otherwise required by applicable securities legislation. August 2013 2TSX Venture: PKK
    • About Peak Positioning Technologies  Peak Positioning is a Canadian Software Developer for smartphones and other mobile computing devices, conducting business primarily in China and North America  In association with its partner, LongKey-Hong Kong Ltd (LongKey), the Company has developed the AiNiTM Mobile Cloud Platform (AiNiTM). AiNiTM is marketed to mobile network providers as a way to tie mobile subscribers to their networks and increase network profitability. The platform comes with a suite of applications that includes: – IM (instant messaging) aggregation – Group chat – File sharing – Data synchronization – Automated device configuration – Several important security features  LongKey markets AiNiTM and its own Software as a Service (SaaS) solutions in China through its partnerships with major Chinese telecommunication companies and banks – Peak markets AiNiTM to mobile network providers in markets outside of China  Peak is developing its business along two parallel growth paths: – Continue to develop opportunities for AiNiTM, SaaS and E-Commerce in China through its association with LongKey – Establish distribution partners for AiNiTM with telecom providers outside of China TSX Venture: PKK 3August 2013
    • Capital Structure TSX Venture: PKK 4 TSX Venture Exchange: PKK Shares Outstanding: 82.7 Million 52 week High/Low: $0.11/$0.03 Warrants (expire December 2013 to August 2014 at Avg price $0.13): 13.3 Million Options (expire April 2016 to May 2018 at Avg price $0.14): 6.1 Million Fully Diluted: 102.2 Million Market Capitalization: $4.1 Million Insider Ownership: 33% Institutional Ownership: 24% August 2013
    • Peak Positioning Board and Management  Charles-Andre Tessier, LL.L., Chairman – A business lawyer and advisor working mainly in the IT, telecom and manufacturing sectors servicing companies such R3D Consulting Inc., DMR Group Inc., BioChem Pharma, BCF Business Lawyers LLP – He sits on the board of a number of private and public companies and non-profit organizations and sat on the Executive Committee of the Association of Canada General Counsel – Mr. Tessier holds a Civil Law degree and a Bachelor's degree in Administration from the University of Ottawa and he has been a member of the Barreau du Quebec since 1980  Johnson Joseph, MBA, President & CEO, Director – Former VP of Product Development and Operations of a Montreal-based e-commerce portal – He was also credited with designing a reconciliation and financial settlement system, certified by Toronto-Dominion Bank’s VISA division, that was instrumental in becoming the first Canadian entity authorized by Visa International to have the sales proceeds of multiple retailers be deposited into a common bank account under the authority of a third party – Mr. Joseph holds an MBA in Information Technology from HEC-Montreal and a Bachelor’s degree in Finance from Texas Tech University  Laval Bolduc, CA, CFO & Director – More than 35 years of experience in finance, information management, contract negotiation, income tax and auditing – Former VP, Financial Planning at DMR Group Inc., an information management and technology firm – Mr. Bolduc holds a Bachelor's degree in Accounting from the University of Sherbrooke TSX Venture: PKK 5August 2013
    • Peak Positioning Board and Management  Varujan Tasci, BSc., Chief Technical Officer – Held several executive positions in the IT industry, including CTO & CEO – He has researched, engineered and developed several commercially available state-of-the-art systems, including an Internet- based Wireless Wide Area Network (WWAN) ordering system; an Internet-based retail-level client contact and reconciliation application for Telus, a major GSM network provider and a leading-edge Internet security video monitoring system for Alarm Centrals – Mr. Tasci holds a Bachelor’s degree in Computer Science from Concordia University  Robert Desbiens, Director – Prior to joining R3D in 2008 where he is currently the Executive Vice President, Corporate Strategies, Mr. Desbiens was the VP Eastern Canada at Cisco Systems, Executive Advisor of Strategy and Innovation at IBM Canada, and Deputy Minister of the government information highway and information resources at the Quebec Government. He is also currently Chairman of the Finance and Audit Committee of the Board of Trade of Metropolitan Montreal – Mr. Desbiens graduated from the OPM program at Harvard University in 1997 and from HEC's Business Administration Program in 1992  George Hebert, MBA, Director – Currently the President and CEO of Prosys Tech Corp – Prior to joining Prosys, Mr. Hébert was the CEO and majority shareholder of security company J.A. Provost Ltd until 1998, when he sold the company to Bell Canada. He is currently a Board member of Vitran Corporation and was a Board member of the Laurentian Bank of Canada from 1990 to 2008. – Mr. Hébert holds an MBA from Western University  Kerrigan Turner, BSc., Director – Currently the Chairman of the Board of both Prosys-Tech Corporation and Montreal-based logistics and shipping software provider Go-Logix. He is also the CEO of Adatif International Inc., a holding company having interests in various businesses worldwide, including well-established companies in the fields of healthcare and pharmaceuticals – Mr. Turner is also the Chairman of the Board of Bouclair Inc., a well-known privately owned specialty retailer with 125 stores across Canada – Mr. Turner holds a Bachelor of Science degree from the University of Ottawa. TSX Venture: PKK 6August 2013
    • LongKey Management  Alex Wong, MSc, BSc., CEO – Former CTO of Inspur Ltd., one of the largest IT companies in China, playing a significant role in the establishment of many national standards for the Chinese mobile and financial industries. At Inspur, he was a part of the team that generated over $16B RMB in annual sales – Mr. Wang holds a Bachelor of Science degree from the Beijing Institute of Communications and a Master of Science degree from Louisiana Tech University  Golden Qiu, BSc., CTO – Former founder and CEO of Montreal-based Ollwin International Ltd. And inventor of the NetCore Web Engine – Mr. Qiu holds a Bachelor of Science degree from McGill University  Albert Bao, BMath, COO – Former CEO of DV Vision Ltd, the number 1 video conference company in China. – Mr. Bao holds a Bachelor of Mathematics degree from QingHua University  Roy Zhang, BEng., CMO – Former CMO of YongZhong Software Ltd. – Mr. Zhang holds a Bachelor of Engineer degree from QingHua University  Richard Tan, MBA, CFO – Former CFO of Unis and Orange Entertainment – Mr. Tan holds an MBA from the Wharton Business School of Pennsylvania TSX Venture: PKK 7August 2013
    • The Chinese Mobile Market  World's largest mobile market with over 1.18 billion mobile subscribers as of June 2013  The fastest growing 3G subscriber base – Over 325 million 3G subscribers as of June 2013  Dominated by 3 state-owned mobile network operators – China Mobile 740 million subscribers (63% market share) – China Unicom 262 million subscribers (22% market share) – China Telecom 175 million subscribers (15% market share) TSX Venture: PKK 8August 2013
    • Growth Strategy  Peak has entered into an agreement to acquire LongKey  In addition to its distribution of AiNiTM, LongKey also provides a suite of cloud-based Software as a Service (SaaS) solutions aimed at Chinese SMBs  LongKey’s SaaS products are distributed by telecom and financial institution partners, including China Telecom and the Industrial and Commercial Bank of China (ICBC), bundled with these partners’ own traditional product offerings  LongKey’s revenues from its SaaS offerings are projected to grow at over 200% annually over the next 2-3 years  Following the acquisition, the merged company plans on leveraging Peak’s expertise in mobile development to adapt LongKey’s SaaS products, which are currently accessed through a web interface for mobile 3G smart devices TSX Venture: PKK 9August 2013
    • Business Combination  The Acquisition of LongKey: – Peak agreed to acquire all issued and outstanding shares of LongKey, a private holding company based in Hong Kong with 6 shareholders that act independently and therefore will not collectively constitute a voting block  The Terms of the Acquisition: – Peak to issue $2M in common shares at a price of $0.10 per share at the completion of the Acquisition, plus; – An additional consideration based on revenues as follows: • A minimum achievement of US$4M in revenues in 2014: – 6,666,667 PKK common shares for each $1M revenue for an aggregate maximum of 26,666,667 PKK common shares at a price of $0.15/share • A minimum achievement of US$8M in revenues in 2015: – 2,500,000 PKK common shares issued for each tranche of $2M in revenue for an aggregate maximum of 10,000,000 PKK common shares at a price of $0.20/share TSX Venture: PKK 10August 2013
    • LongKey Cloud-Based IT services  LongKey's SaaS offerings are enabled by its proprietary UISP platform – LongKey’s business model is comparable to Salesforce.com (NYSE: CRM), NetSuite (NYSE: N) and 800App.com TSX Venture: PKK 11August 2013
    • LongKey Product Offering TSX Venture: PKK 12 5. E-Boss/E-commerce (offered via ICBC) 1. AiNiTM Mobile Platform (to be offered via China Unicom) 2. Office Automation (offered via China Telecom) 3. Government Web Portal (offered via China Telecom) 4. Intelligent Community (offered via China Telecom) August 2013
    • 1. AiNiTM Mobile Cloud Platform  Based on China Unicom’s Personal Communication Center Initiative  Main features include:  IM apps aggregation  Contact-centric communications  Data synchronization  “Circles” social media app  Group Instant Messaging  Push Email  Automated device configuration  Remote device lock  Remote device locate TSX Venture: PKK 13August 2013
    • AiNiTM Instant Messaging Apps Aggregation  AiNiTM allows users with different IM apps to communicate with each other as if they were using the same IM app  AiNiTM also provides message notification even when users are not logged into any IM apps TSX Venture: PKK 14 Without AiNiTM With AiNiTM August 2013
    • AiNiTM Contact-Centric Communications  From the "Contacts" menu, AiNiTM conveniently provides all the ways possible to communicate with a particular contact, including automated login to the most popular social media apps TSX Venture: PKK 15August 2013
    • AiNiTM Data Synchronization  Enter a calendar event or a new contact on one device, and the information gets automatically synced to other devices TSX Venture: PKK 16August 2013
    • AiNiTM “Circles” Social Media App  AiNiTM’s “Circles” app allows users to invite family, friends, co-workers and other acquaintances to join groups that they create and manage, where group members can easily engage in group communications and share information TSX Venture: PKK 17August 2013
    • AiNiTM Platform Distribution  National-level distribution agreement with China Unicom  AiNiTM to be pre-installed on China Unicom mobile devices  Addressable market of 250+ million China Unicom mobile subscribers  Proposed Revenue Model – China Unicom to pay between $0.50 and $0.75 per mobile device per month TSX Venture: PKK 18August 2013
    • 2. Office Automation  Allows small businesses to manage daily office tasks such as: – Workflow management, company directory, chat client, etc…  Initial set-up includes account creation and user admin account  Applications accessed via web  Clients pay an average of US$160/month, with no set-up fee  Offered currently only in the city of Wuxi, Jiangsu Province – 300 clients (makes up 31% of current LongKey revenues) – 2 Million potential clients in Jiangsu Province TSX Venture: PKK 19August 2013
    • 3. Government Web Portal  Information sites for cities and internal departments  Clients pays US$3,200/year for maintenance and support, with no set-up fee  Currently available in three cities in Jiangsu Province – 160 clients (makes up 28% of current LongKey revenues) – Approximately 2,000 potential clients per province  Excellent potential to replicate offering to other provinces  Total Service Potential US$64 Million/year TSX Venture: PKK 20August 2013
    • 4. Intelligent Community  Web portal designed for residential community management – Building management, security patrol, utilities notification, general communications with residents, etc…  Easy set-up with minor customization needed  Clients pay US$3,200/year + US$40/employee/year, with no set-up fee  Currently offered in the city of Wuxi – 35 clients (makes up 36% of current LongKey revenues)  Excellent potential to replicate offering in other provinces  Total service potential market of US$1.9 Billion/year TSX Venture: PKK 21August 2013
    • 5. E-Boss/ E-Commerce  Sales & Asset management package comprised of many modules such as: – E-commerce, sales management, distribution management, warehouse management, etc…  All modules (except E-commerce) accessed via web interface  Independent storefront E-commerce clients pay US$950 to $8,000/year for maintenance & support plus 20% per transaction fee, with not set-up fee  Independent business clients pay an average of $1,600/year for all E-Boss services including E- Commerce  Professional Market (Mini-malls) E-Commerce clients pay US$48,000 set-up fee and each member store pays US$95/year for maintenance and support  Currently in 12 cities of Zhejiang Province – 150 clients makes up 5% of current LongKey revenues – Approximately 400,000 potential independent business clients in Zhejiang Province  Excellent potential to replicate offering to other provinces – Expanded to DongBei Province in June 2013  Total service potential market of US$6.4 Billion/year TSX Venture: PKK 22August 2013
    • LongKey Deployment & Growth Strategy TSX Venture: PKK 23 The 3 Business Pillars Mobile Work with Peak & China Unicom and deploy mobile platform to all Chinese Provinces SaaS Offer simple & powerful cloud- based SaaS solutions in partnership with China Telecom & Government E-Commerce Offer full-range e-commerce solutions to SMBs in partnership with ICBC & ABC August 2013
    • LongKey Deployment Overview TSX Venture: PKK 24 E-commerce partnership with ICBC in Huzhou in 2012 E-commerce partnership with ABC in Huzhou in 2013 National mobile development partnership with China Unicom in 2012 SaaS solution partnership with China Telecom in Wuxi since 2008 August 2013
    • SaaS & E-Commerce Financials & Revenue Projections TSX Venture: PKK 25 2012 2013 2014 2015 Office Automation # of clients 300 500 800 1,500 Average Annual Rate $1,920 $1,920 $1,920 $1,920 Revenue $576,000 $960,000 $1,536,000 $2,880,000 Government Web Portals # of clients 160 200 400 800 Average Annual Rate $3,200 $3,200 $3,200 $3,200 Revenue $512,000 $640,000 $1,280,000 $2,560,000 Intelligent Communities # of clients 35 70 500 1,000 Average Annual Rate $19,200 $19,200 $19,200 $19,200 Revenue $672,000 $1,344,000 $9,600,000 $19,200,000 E-Boss (including Independent E-Commerce) # of clients 50 350 2,500 8,000 Average Annual Rate $1,600 $1,600 $1,600 $1,600 Revenue $80,000 $560,000 $4,000,000 $12,800,000 Professional Market E-Commerce # of clients 100 10,000 50,000 100,000 Average Annual Rate $95 $95 $95 $95 Revenue $9500 $950,000 $4,750,000 $9,500,000 Total Revenues $1,849,500 $4,454,000 $21,166,000 $46,940,000 LongKey Unaudited Financials As of December 31, 2011 US$ Current Assets $836,942 Total Assets $5,490,042 Current Liabilities $226,530 Total Liabilities $307,939 Net Income $235,022 Revenues $1,654,942 August 2013
    • Peak’s Royalties from Chinese Operations TSX Venture: PKK 26 $- $20,000 $40,000 $60,000 $80,000 $100,000 $120,000 $140,000 $160,000 $180,000 $200,000 Q2-2012 Q3-2012 Q4-2012 Q1-2013 $20,087 $26,788 $112,134 $195,149 August 2013
    • Short-Term Objectives TSX Venture: PKK 27 August 2013  Launch AiNiTM on top mobile app stores in China Q3 – 2013  Launch AiNiTM with China Unicom data plan bundles in China  Complete acquisition of LongKey Q1 – 2014  Reach AiNiTM distribution agreement in market outside of China Q4 – 2014  Reach 3 Million AiNiTM- installed China Unicom mobile devices (only 1.2% of the potential install base) Ongoing  Be recognized as the gateway by which North American mobile apps are introduced to the Chinese mobile computing market  Develop more tailor-made apps generating higher rates of revenue per device August 2013
    • Contact Information Peak Positioning Technologies Inc. Johnson Joseph, President & CEO T: +1-514-340-7775 x 501 E: investors@peakpositioning.com CHF Investor Relations Jeanny So, Director of Operations T: +1-416-868-1079 x 225 E: jeanny@chfir.com www. peakpositioning.com TSX Venture: PKK 28August 2013