Revelstoke Equity Inc. Announces Letter of Intent for Proposed Business Combination With Zonetail Inc.
Revelstoke Equity Inc. Announces Letter of Intent for Proposed Business Combination With Zonetail Inc. ET | Source: Revelstoke Equity Inc.
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TORONTO, Jan. 31, 2018 (GLOBE NEWSWIRE) — Revelstoke Equity Inc. (TSXV:REQ.H) (the “Corporation” or “Revelstoke”) is pleased to announce that it has entered into a letter of intent with Zonetail Inc. (“Zonetail”) dated January 29, 2018 (the “Letter of Intent”) in respect of a proposed transaction pursuant to which Revelstoke and Zonetail are expected to combine their business operations (the “Transaction”). Upon completion of the Transaction, the combined entity (the “Resulting Issuer”) will continue to carry on the business of Zonetail. It is expected that upon completion of the Transaction, the Resulting Issuer will meet the Initial Listing Requirements for a Tier 2 Technology issuer under the policies of the TSX Venture Exchange (the “Exchange”).
General Information on Revelstoke and Zonetail
Revelstoke is a “capital pool company” under the policies of the Exchange and it is intended that the Transaction will constitute the “Qualifying Transaction” of the Corporation, as such term is defined in Exchange Policy 2.4 – Capital Pool Companies. The Corporation is currently listed on the NEX board of the Exchange and is a reporting issuer in the provinces of British Columbia, Alberta and Ontario.
Zonetail is incorporated under the laws of Canada and has a head office in Toronto, Ontario, and an office in Pasadena, California. Founded in 2013, Zonetail’s technology is an anchored local mobile content engine that connects users with their location and surroundings. It is designed to save time and make locations more familiar, social, and rewarding. More than a mobile application, Zonetail’s technology platform is a cloud-based content management system and analytics suite. Zonetail currently provides their mobile platforms to hotels and condominiums across North America. Zonetail is currently exploring the implementation of blockchain technology into the hotel and condominium mobile platforms to enhance the current business model and revenue streams.
Since incorporation, Zonetail has used its funds to develop its technology, prove out the concept, sign a number of hotels, condominiums and advertisers and develop strategic partnerships. To date, Zonetail has signed a substantial number of hotel properties in Canada, U.S.A. and other jurisdictions as well as a substantial number of condominium buildings in Canada.
No person, either directly or indirectly, holds a controlling interest in or otherwise controls or directs Zonetail.
It is currently anticipated that the Transaction will occur as a merger, amalgamation or share exchange, the final structure of the Transaction being subject to receipt of tax, corporate and securities law advice for both the Corporation and Zonetail. The transaction terms outlined in the Letter of Intent are non-binding on the parties and the Letter of Intent is expected to be superseded by a definitive agreement (the “Definitive Agreement”) to be signed between the parties. The Transaction is subject to regulatory approval, including the approval of the Exchange, and the satisfaction of customary closing conditions, including the approval of the Definitive Agreement and the Transaction by the board directors of each of Revelstoke and Zonetail and completion of due diligence investigations to the satisfaction of each of Revelstoke and Zonetail, as well as the conditions described below. The Transaction will be carried out by parties dealing at arm’s length to one another and therefore will not be considered to be a “Non-Arm’s Length Qualifying Transaction”, as such term is defined under the policies of the Exchange.
In due course once available, Revelstoke and Zonetail will provide further details by press release in respect of the Transaction, including the issued and outstanding securities of each of Revelstoke and Zonetail, the terms of the exchange of securities of Revelstoke and Zonetail, the applicable security exchange ratios and the details of any meetings of the shareholders of Revelstoke and Zonetail required to approve the Transaction and matters related thereto (as applicable).
The Letter of Intent contains a condition that Zonetail complete a brokered private placement of Zonetail common shares (“Zonetail Shares”) to raise at minimum the amount of gross proceeds required for the Resulting Issuer to meet the initial listing requirements of the Exchange (the “Private Placement”). Details on the Private Placement, including the amount of proceeds to be raised, the number of Zonetail Shares offered for issuance, the agent or agents engaged to broker the Private Placement and the use of proceeds from the Private Placement will be provided in due course once available by way of press release.
Sponsorship of Qualifying Transaction
Sponsorship of the Transaction, as the Qualifying Transaction of Revelstoke, is required by the Exchange unless an exemption from this requirement can be obtained in accordance with the policies of the Exchange. The Corporation intends to apply for an exemption to the sponsorship requirement. There is no assurance that an exemption from this requirement will be obtained.
The common shares of Revelstoke (“Revelstoke Shares”) are currently halted from trading, and the trading of Revelstoke Shares is expected to remain halted pending completion of the Transaction.
If and when a Definitive Agreement between the Corporation and Zonetail is executed, the Corporation will issue a subsequent press release in accordance with the policies of the Exchange containing the details of the Definitive Agreement and additional terms of the Transaction including information relating to sponsorship, summary financial information in respect of Zonetail, and to the extent not contained in this press release, additional information with respect to the Private Placement, history of Zonetail and the proposed directors, officers, and insiders of the Resulting Issuer upon completion of the Transaction.
Completion of the Transaction is subject to a number of conditions including, but not limited to, completion of the Private Placement, the satisfaction of the Corporation and Zonetail in respect of the due diligence investigations to be undertaken by each party, the completion of a Definitive Agreement in respect of the Transaction, closing conditions customary to transactions of the nature of the Transaction, approvals of all regulatory bodies having jurisdiction in connection with the Transaction, Exchange acceptance of the Transaction as the Qualifying Transaction of Revelstoke and, if required by the Exchange policies, majority of the minority shareholder approval. Where applicable, the Transaction cannot close until the required shareholder approvals are obtained and 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 Transaction, any information released or received with respect to the Transaction may not be accurate or complete and should not be relied upon. Trading in the securities of a capital pool company should be considered highly speculative.
|For further information please contact: |
Revelstoke Equity Inc.:
Craig Leon, Chief Executive Officer, Chief Financial Officer, Corporate Secretary and Director
Telephone: (416) 368-2773
This news release contains “forward-looking information” within the meaning of applicable securities laws relating to the proposal to complete the Transaction and associated transactions, including statements regarding the terms and conditions of the Transaction, the Private Placement and the Definitive Agreement. The information about Zonetail contained in the press release has not been independently verified by the Corporation. Although the Corporation believes in light of the experience of its officers and directors, current conditions and expected future developments and other factors that have been considered appropriate that the expectations reflected in this forward-looking information are reasonable, undue reliance should not be placed on them because the Corporation can give no assurance that they will prove to be correct. Readers are cautioned to not place undue reliance on forward-looking information. Actual results and developments may differ materially from those contemplated by these statements depending on, among other things, the risks that the parties will not proceed with the Transaction, the Private Placement, the Definitive Agreement and associated transactions, that the ultimate terms of the Transaction, the Private Placement, the Definitive Agreement and associated transactions will differ from those that currently are contemplated, and that the Transaction, the Private Placement, the Definitive Agreement and associated transactions will not be successfully completed for any reason (including the failure to obtain the required approvals or clearances from regulatory authorities). The terms and conditions of the Transaction may change based on the Corporation’s due diligence (which is going to be limited as the Corporation intends largely to rely on the due diligence of other parties of the Transaction to contain its costs, among other things) and the receipt of tax, corporate and securities law advice for both Revelstoke and Zonetail. The statements in this press release are made as of the date of this release. The Corporation undertakes no obligation to comment on analyses, expectations or statements made by third-parties in respect of the Corporation, Zonetail, their securities, or their respective financial or operating results (as applicable).
Neither the TSX Venture Exchange, Inc. nor its Regulation Services Provider (as that term is defined in the polices of the TSX Venture Exchange) has in any way passed upon the merits of the Transaction and associated transactions and neither of the foregoing entities has in any way approved or disapproved of the contents of this press release.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
The common shares have not been and will not be registered under the United States Securities Act of 1933, as amended and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirement. This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any jurisdiction in which such offer, solicitation or sale would be unlawful.