March 31, 2008
The acquisition represents the completion of the Corporation's arm's length qualifying transaction (the "Qualifying Transaction") pursuant to the policies of the TSX Venture Exchange Inc. (the "Exchange"). Upon issuance by the Exchange of the Final Exchange Bulletin approving the transaction, the Corporation will be a Tier 2 issuer whose shares will be listed for trading on the Exchange with the symbol TSXV:ASY.
Avante is a company that was incorporated under the laws of the
Avante has developed proprietary hardware and software for wireless security, which provides monitoring for data and video, home automation and remote monitoring, demand/response energy management and metering applications. Avante's Secure 724 S-WIP is a smart interactive portal module that uses proprietary hardware to convert wired information to a wireless format without the need of a personal computer or server. Secure 724 transmits data in multiple formats to wireless mobile devices and/or PC's. With 724 S-WIP BlackBerry software, a BlackBerry can remotely control and obtain data from the 724 S-WIP module installed in a dwelling.
The Corporation acquired all of the common shares of Avante (the "Avante Shares") pursuant to a share purchase agreement dated January 10, 2008, as amended (the "Share Purchase Agreement"). Each shareholder of Avante received one share in the capital of the Corporation (the "Common Shares") in exchange for each Avante Share. The former shareholders of Avante hold approximately 73% and the former shareholders of the Corporation hold approximately 27% of the shares in the capital of the Corporation. The Corporation issued a Filing Statement pursuant to Exchange policies, containing prospectus like disclosure regarding Avante and the transaction on February 29, 2008. This filing statement is accessible on SEDAR by viewing the Corporation's public documents. See www.sedar.com
The Share Purchase Agreement provided for the acquisition of the Avante Shares at a purchase price of $5.8 million. The purchase price was satisfied by the issuance of Common Shares in the capital of the Corporation at the deemed value of $0.20 per share. All options to acquire securities in the capital of Avante shall be replaced by options to acquire the same number of shares and on substantially the same terms in the capital of the Corporation.
As part of the transaction, the Corporation proposes to change its name to Avante Security Corp. and appoint new auditors subject to final exchange approval, as approved by the shareholders of the Corporation at the special meeting of the shareholders held on November 20, 2007.
There were 10,750,000 Common Shares issued and outstanding in the capital of the Corporation immediately prior to the completion of the transaction. In addition, there were incentive options to acquire a further 450,000 Common Shares granted to the officers and directors of the Corporation and options to acquire 200,000 Common Shares granted to the agent as part of the Corporation's initial public offering. 5,095,000 of these Common Shares are subject to Exchange escrow provisions.
Avante had 29,000,000 shares issued and outstanding immediately prior to the completion of the transaction. There were 21,200,000 Avante Shares issued and outstanding as at January 1, 2008. Since that date and prior to the completion of the transaction, Avante has:
(a) issued 1,800,000 common shares to Illyria Inc. as partial
consideration for services provided to Avante pursuant to a
(b) completed private placements in the aggregate amount of $1,304,247
(4,830,545 shares) at a subscription price of $0.27 per share; and
(c) capitalized shareholder loans in the principal amount of $315,753
Immediately following the transaction, there will be 39,750,000 Common Shares in the capital of the Corporation issued and outstanding. These shares consist of 29,000,000 Common Shares held by persons who were shareholders of Avante and 10,750,000 Shares held by persons who were shareholders of the Corporation. In addition, the options to acquire 1,210,000 common shares of Avante granted January 7, 2008 to certain senior managers, employees and consultants on the basis of one common share at a price of $0.20 per share until January 6, 2013 will be replaced with options to acquire shares in the capital of the Corporation on the same basis for a total of 1,860,000 options to acquire Common Shares in the Corporation. A total of 29,664,455 Common Shares will be subject to Exchange escrow provisions. Of these shares, 5,495,000 are subject to a value escrow arrangement and 24,169,455 will be subject to a surplus escrow arrangement. In addition, 585,000 of the Avante options are subject to surplus escrow arrangements. The provisions of the value escrow permit release of 10% of the escrowed shares at the time of the Final Exchange Bulletin approving the transaction and further 15% every six months thereafter for a total period of 36 months. The provisions of the surplus escrow permit release of 5% of the escrowed shares six months after the Final Exchange Bulletin approving the transaction, further 5% every six months thereafter for the next 18 months and 10% every six months thereafter for the next 48 months for a total period of 72 months.
The only shareholder of the Corporation owning more than 10% of the issued and outstanding Common Shares is Emmanuel Mounouchos who owns, directly and indirectly through The Emmanuel Mounouchos Family Trust, 23,369,455 shares in the capital of the resulting issuer representing 58.79% of the issued and outstanding shares, 1,000,000 of which are subject to a value escrow and 22,369,455 which are subject to a surplus escrow.
The transaction constitutes an arm's length Qualifying Transaction. No director or officer of the Corporation had any interest in Avante prior to the completion of the transaction.
As part of the transaction, the Corporation increased the size of its board of directors from five to six. Emmanuel Mounouchos has been elected as a director in addition to the existing directors. The officers of the Corporation have resigned and Leland Verner has been appointed Chairman, Emmanuel Mounouchos has been appointed Chief Executive Officer and President and William McKetrick has been appointed Secretary and Chief Financial Officer.
The completion of the transaction is subject to final approval by the Exchange.
The TSX Venture Exchange Inc. has not reviewed and does not accept responsibility for the adequacy or accuracy of this release. The TSX Venture Exchange Inc. has in no way passed upon the merits of the proposed transaction and has neither approved nor disapproved of the contents of this release.
For further information: Leland Verner, Chairman, Matiadeka Ventures Inc., firstname.lastname@example.org, Tel: (416) 823-7474