Not for Distribution to U.S. Newswire Services or for Dissemination in the United States
TORONTO, CANADA / ACCESSWIRE / October 24, 2018 / Phoenix Canada Oil Company Limited (TSX-V: PCO) ("Phoenix" or the "Company") is pleased to announce that it has entered into a non-binding letter of intent (the "LOI") dated October 23, 2018 with VMedia Inc., a private Canadian corporation ("VMedia") that offers telecom and broadcasting services across Canada, and is a pioneer in the development of live streaming TV solutions. As presently contemplated, it is expected that the proposed transaction (the "Proposed Transaction") will be completed by way of a statutory plan of arrangement under the Canada Business Corporations Act, and that the completion of the Proposed Transaction will constitute a reverse takeover of the Company by VMedia.
Charlotte Moore Hepburn, the CEO of Phoenix, stated that, "We are pleased to have found a high potential strategic partner who shares our corporate values and has the ability to provide a significant growth opportunity for our shareholders. We are excited about the proposed transaction with VMedia and look forward to working collaboratively with VMedia in pursuit of an expeditious and favourable outcome."
"We are very pleased to embark on this important new stage in VMedia's growth, in partnership with Phoenix," said George Burger, Co-founder of VMedia. "Since launching VMedia five years ago, our focus has been to provide Canadians with better value and innovative features for internet, TV, home phone and home security services. This important new strategic partnership will allow us to significantly advance our position as the leading independent provider of these key residential services and THE alternative to the major cablecos and telcos all across Canada."
"The deal will also provide us with the resources to build on our technology leadership in streaming video platforms, including live streaming TV, which VMedia was the first to launch in Canada in 2013," said Alexei Tchernobrivets, Co-Founder of VMedia. "Streaming video is transforming the way in which viewers enjoy TV. It offers lower costs and easier access to great content, and this transaction will help us to continue to lead the way."
General Information on Phoenix and VMedia
Phoenix is incorporated under the laws of the Province of Ontario and has a head office in Toronto, Ontario. The Company is a reporting issuer in the provinces of British Columbia, Alberta and Ontario.
VMedia is a company incorporated under the federal laws of Canada and has its head office in Vaughan, Ontario. VMedia offers high-speed internet, TV, home phone and home security services across Canada. VMedia's mission is to provide Canadians with the most affordable prices, choice and flexibility and ongoing innovation in the industry. As a broadcasting distribution undertaking (BDU) licensed by the CRTC to offer TV services from coast to coast, VMedia is the only national TV and internet provider. The company has deep expertise in IPTV technology, and is an industry leader in the development of streaming video solutions including app-based live TV streaming solutions compatible with a wide range of media devices including ROKU, Android TV and others. VMedia was the first in Canada to introduce:
- An android-based set top box, VMedia's own VBox, that provides live TV, VOD and access to 100s of apps in one seamless user interface
- Net PVR, through VMedia's VCloud service
- Client-side PVR on an android device
- Access to its streaming TV services on third-party devices, such as ROKU
General Information Regarding the LOI
VMedia and the Company entered into the LOI, which sets out the basic terms and conditions for the Proposed Transaction, on October 23, 2018. The Proposed Transaction is expected to be structured as a reverse takeover ("RTO") under the rules and policies of the TSX Venture Exchange ("TSXV"). The RTO contemplates the amalgamation of a wholly owned subsidiary of the Company and VMedia, and upon completion of the Proposed Transaction, the combined entity (the "Resulting Issuer") will continue to carry on the business of VMedia. It is expected that upon completion of the Proposed Transaction, the Resulting Issuer will meet the Initial Listing Requirements for a Tier 1 Technology issuer under the policies of the TSXV.
The transaction terms outlined in the LOI are non-binding, and the Proposed Transaction is subject to the parties successfully entering into a definitive agreement (the "Definitive Agreement") in respect of the Proposed Transaction.
The LOI also contemplates other material conditions precedent to the closing of the Proposed Transaction (the "Closing"), including customary due diligence, compliance with all applicable regulatory requirements and receipt of all necessary regulatory, corporate, third-party, board and shareholder approvals in addition to approval of the Ontario Superior Court.
Financial Advisors
Origin Merchant Partners is acting as the financial advisor to Phoenix and INFOR Financial Inc. is acting as the financial advisor to VMedia in connection with the Proposed Transaction.
Sponsorship
Sponsorship of the Proposed Transaction may be required by the TSXV unless an exemption or waiver from this requirement can be obtained in accordance with the policies of the TSXV. The Company intends to apply for a waiver of the sponsorship requirement. There is no assurance that a waiver from this requirement can or will be obtained.
Halt of Trading of Common Shares of the Company
The common shares of the Company are currently halted from trading, and the trading of common shares of the Company is expected to remain halted pending completion of the Proposed Transaction.
Additional Information
If and when a Definitive Agreement between the Company and VMedia is executed, the Company will issue a subsequent press release in accordance with the policies of the TSXV containing the details of the Definitive Agreement and additional terms of the Proposed Transaction including information relating to sponsorship if required, summary financial information in respect of VMedia, and additional information with respect to the history of VMedia and the proposed directors, officers, and insiders of the Resulting Issuer upon completion of the Proposed Transaction.
Completion of the Proposed Transaction is subject to a number of conditions including, but not limited to, the satisfaction of the Company and VMedia in respect of the due diligence investigations to be undertaken by each party, the execution of the Definitive Agreement in respect of the Proposed Transaction, closing conditions customary to transactions of the nature of the Proposed Transaction, approval of the Ontario Superior Court, approvals of all regulatory bodies having jurisdiction in connection with the Proposed Transaction, TSXV acceptance and, if required by the TSXV policies, majority of the minority shareholder approval. Where applicable, the Proposed Transaction cannot close until the required shareholder approvals are obtained and there can be no assurance that the Proposed 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 Proposed Transaction, any information released or received with respect to the Proposed Transaction may not be accurate or complete and should not be relied upon. Trading in the securities of the Company should be considered highly speculative.
Neither the TSXV nor its Regulation Services Provider (as that term is defined in the policies of the TSXV) has in any way passed upon the merits of the Proposed 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 the TSXV nor its Regulation Services Provider accepts responsibility for the adequacy or accuracy of this press release.
The common shares of the Company 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.
Forward-Looking Statements
This news release contains "forward-looking information" within the meaning of applicable securities laws relating to the Proposed Transaction including statements regarding the terms and conditions of the Proposed Transaction and the LOI, as well as information relating to VMedia. The information about VMedia contained in the press release has not been independently verified by the Company. Although the Company 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 Company 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 Proposed Transaction and the LOI; that the ultimate terms of the Proposed Transaction and the LOI will differ from those that currently are contemplated; and that the Proposed Transaction and the LOI 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 Proposed Transaction may change based on the Company's due diligence and the receipt of tax, corporate and securities law advice for both the Company and VMedia. The statements in this press release are made as of the date of this release. The Company undertakes no obligation to comment on analyses, expectations or statements made by third-parties in respect of the Company, VMedia, their securities, or their respective financial or operating results (as applicable).
SOURCE: Phoenix Canada Oil Company Limited