Vancouver, British Columbia / TheNewswire / April 12, 2018 - Newcastle Energy Corp. (NEX-NGY.H) ("Newcastle" or the "Company") is pleased to announce that it has entered into a letter of intent, dated April 10, 2018, with Martello Technologies Inc. ("Martello") to complete a reverse takeover transaction (the "Proposed Transaction"). In addition and in connection with the Proposed Transaction, Martello will undertake a private placement of minimum gross proceeds of $4,000,000 (the "Minimum Financing") and maximum gross proceeds to $6,000,000 (the "Maximum Financing").
Upon the closing of the Proposed Transaction, it is proposed that Newcastle will become a Technology Issuer and will be renamed Martello Technologies Inc. (the "Resulting Issuer"). The Resulting Issuer will carry on the business of Martello as currently constituted.
The Proposed Transaction
The Proposed Transaction will be carried out by way of a share exchange, merger, amalgamation, arrangement, takeover bid, or other similar form of transaction which will result in Martello becoming a wholly-owned subsidiary of Newcastle or otherwise combining its corporate existence with a wholly-owned subsidiary of Newcastle. The Proposed Transaction will constitute a reverse takeover under TSX Venture ("TSXV") Policy 5.2. Subject to regulatory and other required approvals, and the satisfaction of other conditions contained in a definitive agreement between Newcastle and Martello (the "Definitive Agreement"), Newcastle will acquire all the issued and outstanding shares of Martello (the "Martello Shares").
Former Martello shareholders will receive 3.2 common shares in the capital of the Resulting Issuer ("Resulting Issuer Shares") in exchange for each Martello Share held by them (the "Exchange Ratio"). There are currently 34,519,802 Martello Shares issued and outstanding. All outstanding options and other convertible securities of Martello will be exchanged at the Exchange Ratio for options and convertible securities of the Resulting Issuer having the same economic terms, or will be adjusted pursuant to the terms governing such options or convertible securities, as applicable.
Martello expects to pay Regents Park Securities Ltd. a consulting fee between $500,000 and $700,000 upon the completion of the Proposed Transaction. The fee is payable by the issuance of Martello Shares at a price per share equal to the price per share issued pursuant to the terms of the Proposed Transaction.
In connection with the Proposed Transaction, Martello will also undertake a placement (the "Private Placement") of its common shares at a price of $0.48 per common share which is expected to close shortly prior to the closing of the Proposed Transaction. The Private Placement is currently anticipated to raise aggregate gross proceeds of a minimum of $4,000,000 to a maximum of $6,000,000. The Martello shares issued will be exchanged in accordance with the share Exchange Ratio upon the closing of the Proposed Transaction.
Martello Technologies Inc.
Martello was incorporated April 20, 2009 under the provisions of the Canada Business Corporations Act and has its registered and head office in Ottawa, Ontario. Martello is a software-as-a-service and SD-WAN technology development company. It develops solutions that manage and optimize the performance of real-time services on cloud and enterprise networks, with a specialization in unified communications (UC) systems. IT professionals using Martello's solutions can proactively avoid downtime and maintain high service quality. The audited 11 month financial statements ended March 31, 2017 of Martello reflect total assets of $5,541,435, total liabilities of $1,874,484, total revenues of $3,304,203 and a net loss of $103,679.
Newcastle Energy Corp.
Newcastle is a NEX listed company the does not have an active business. It was incorporated under the provisions of the Business Corporations Act (British Columbia) with its registered and head office in Vancouver, British Columbia. Newcastle is a "reporting issuer" in the provinces of British Columbia and Alberta.
The Proposed Transaction is an arm's length transaction subject to requisite regulatory approval, including the approval of the TSX Venture Exchange ("TSXV"). The parties will prepare a filing statement in accordance with the rules of the TSXV, outlining the terms of the Proposed Transaction.
Newcastle currently has 6,086,534 Newcastle Shares issued and outstanding. Newcastle does not intend to seek shareholder approval for the Proposed Transaction in accordance with the rules of the TSXV.
Board of Directors and Management
Upon completion of the Proposed Transaction, subject to regulatory approval, the directors, senior officers and insiders of Newcastle are expected to be as follows:
John Proctor, President & CEO - Mr. Proctor is the President and CEO of Martello. Prior to his work in the private sector, Mr. Proctor served for more than twenty years in the Canadian and British armed forces. He is the former Vice President, Global Cyber Security at CGI, where he was responsible for the company's strategic vision on Cyber Security. Mr. Proctor sits on the Information and Communications Technology Council (ICTC) advisory board for Government Affairs Canada and is a member of the Canadian Advanced Technology Alliance (CATAAlliance) Cyber Council Advisory Board.
Niall Gallagher, Director, Vice-President Product Management - Mr. Gallagher is co-founder and Vice President, Product Management for Martello. Mr. Gallagher has more than 30 years of experience in the telecommunications industry starting with Nortel Networks in 1981. He has held senior management positions in Nortel Networks in Canada and Hong Kong. He joined Mitel Networks in 2005 where he was responsible for Strategic Planning and Product Management for Mitel's Service Provider business. Mr. Gallagher holds a degree in Electrical Engineering from University College Dublin and an MBA from the University of Ottawa.
Doug Bellinger, Chief Technology Officer - Mr. Bellinger is the Chief Technology Officer for Martello. Mr. Bellinger has over twenty years of experience in telecommunications networking, service and network management, and all aspects of software product development and life cycle management. At Martello, Mr. Bellinger is responsible for the company's technology strategy and for building its development team.
Mr. Bellinger previously held positions at Nakina Systems, Atreus Systems, Solect Technology, CrossKeys Systems, CADLink Technology and Newbridge Networks. Prior to co-founding Atreus, Doug was a founding member of CrossKeys Systems Corporation, a network and service management company.
Mr. Bellinger holds a B.A. Sc. (Honours, Applied Science in Electrical Engineering) from Queen's University in Kingston, Ontario.
Paul Chatigny, Chief Financial Officer - Mr. Chatigny is a financial executive with over 20 years of industry experience, mainly in the high-tech sector. He has worked as a controller, has led the finance department in several start-ups, and was CFO of a public (TSX listed) mining company. He has extensive experience and knowledge of finance, accounting systems, treasury management, internal controls, financial reporting & analysis, budgeting and payroll.
Mr. Chatigny holds a degree in Commerce from Carleton University in Ottawa, Ontario, and is a Chartered Accountant with a CPA designation.
Dr. Terence H. Matthews, Co-Chairman - In 1972, he co-founded Mitel Corporation and served as its President until 1985 when British Telecommunications plc bought a controlling interest in the company. In 2001, companies controlled by Dr. Matthews purchased a controlling interest in Mitel Corporation's communications systems division and the "Mitel" trademarks to form Mitel. Between 1986 and 2000, Dr. Matthews founded Newbridge Networks Corporation and served as its Chief Executive Officer and Chairman. Dr. Matthews is also the founder and Chairman of Wesley Clover International Corporation, an investment group, with offices in the United Kingdom and Canada, that invests in a broad range of nextgeneration technology companies, real estate and hotels and resorts. In addition, Dr. Matthews is currently Chairman, or serves on the board of directors, of a number of high technology companies including CounterPath Corporation, ProntoForms Corporation, Solace Systems Inc. and Benbria Corporation. Dr. Matthews holds an honors degree in electronics from the University of Wales, Swansea and is a Fellow of the Institute of Electrical Engineers and of the Royal Academy of Engineering. He has been awarded honorary doctorates by several universities, including the University of Wales, Glamorgan and Swansea, and Carleton University in Ottawa. In 1994, he was appointed an Officer of the Order of the British Empire, and in the 2001 Queen's Birthday Honours, he was awarded a Knighthood. In 2011, he was appointed Patron of the Cancer Stem Cell Research Institute at Cardiff University. In 2017 he was appointed to the Order of Canada.
Bruce Linton, Co-Chairman -Mr. Linton is the co-founder and Chairman of Canopy Growth Corporation. After beginning his career at Newbridge Networks Corporation, he has since held positions that include General Manager and Re-Founder of Computerland.ca, President and CoFounder of webHancer Corp, and part of the establishing team at CrossKeys Systems Corporation. He was also part of the leadership team for the NASDAQ/TSX initial public offering at CrossKeys. He is the past Chairman of the Ottawa Community Loan Foundation, past Board Member on World Bank Water and Sanitation Program Council, past Board Member and Treasurer of Canada World Youth, past Board of Governor for Carleton University, past President of the Nepean Skating Club, and past President of the Carleton University Students Association
Colley Clarke, Director - Mr. Clarke has international experience in finance, capital markets, mergers and acquisitions, corporate strategy, investor relations, legal, and human resources. Mr Clarkes' previous roles include Chief Financial Officer of Redknee Solutions Inc. from March 2004 to March 2009, and a Director of Redknee Solutions Inc. from November 2007 to March 2009. Mr. Clarke holds a Masters of Business Administration (MBA) from the Ivey School of Business, and is a Chartered Accountant with a CPA designation.
Mike Michalyshyn, Director - Mr. Michalyshyn is a seasoned technology lawyer with extensive in-house experience in the embedded software marketplace with QNX Software Systems and BlackBerry. He has served on QNX's senior management team as the General Counsel and VP of HR, and as a co-lead with QNX's CFO during a financing and two subsequent acquisitions of the company. He also served as the head of BlackBerry's Technology Licensing group.
Mr. Michalyshyn graduated with distinction from the University of Alberta Law School, and is a member of the Ontario Bar and a registered Canadian patent agent. He holds a Bachelor's degree in Mechanical Engineering and a Master's in Business Administration. Mike is currently serving as the General Counsel and Corporate Secretary of ViXS Systems Inc., a Canadian fabless semiconductor company.
Don Smith, Director - Mr. Smith, General Partner at Wesley Clover International, has held senior executive roles in the hi-tech industry and was recognized as "CEO of the Year" in 2010 by the Ottawa Business Journal and Telfer School of Management at Ottawa University. As CEO of Mitel from 2001 to 2011, Mr. Smith was responsible for the company's leadership in the emerging market for IP based business communications solutions and took the company public in 2010. Mr. Smith is a BSc. Engineering graduate of Imperial College, London.
Trading in the Newcastle Shares has been halted and may remain halted pending the review of the Proposed Transaction by the TSXV. There can be no assurance that trading in the Newcastle Shares will resume prior to the completion of the Proposed Transaction.
Sponsorship of the Proposed Transaction is required unless an exemption is available or a waiver from this requirement can be obtained in accordance with the policies of the TSXV. Newcastle intends to apply for a waiver to the sponsorship requirement. There is no assurance that a waiver from this requirement will be granted.
Significant Conditions to Completion of the Proposed Transaction
Completion of the Proposed Transaction is subject to a number of conditions, including but not limited to: (a) closing conditions customary to transactions of the nature of the Proposed Transaction; (b) approvals of all regulatory bodies having jurisdiction in connection with the Proposed Transaction; (c) TSXV regulatory approval; and (d) the completion of the Private Placement. There can be no assurance that the Proposed Transaction will be completed as proposed or at all.
For further information, please contact:
Newcastle Energy Corp.
350-750 West Pender Street
Investors are cautioned that, except as disclosed in the filing statement to be prepared in connection with the 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 Newcastle Energy Corp. should be considered highly speculative.
This press release does not constitute an offer of the securities of the Company for sale in the United States. The securities of the Company have not been registered under the United States Securities Act of 1933, (the "1933 Act") as amended, and may not be offered or sold within the United States absent registration or an exemption from registration under the 1933 Act. 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 state in which such offer, solicitation or sale would be unlawful.
The TSXV has in no way passed upon the merits of the Proposed Transaction and has neither approved nor disapproved the contents of this news release.
Neither the TSXV nor its Regulation Services Provider (as that term is defined in the policies of the TSXV) accepts responsibility for the adequacy or accuracy of this news release.
Cautionary Note Regarding Forward-Looking Statements
This news release contains forward-looking statements relating to the Proposed Transaction, including statements regarding timing for closing of the Private Placement, the receipt of all necessary regulatory and other approvals and satisfaction of all other closing conditions in connection with the Proposed Transaction and other statements that are not historical facts. Readers are cautioned not to place undue reliance on forward-looking statements, as there can be no assurance that the plans, intentions or expectations upon which they are based will occur. By their nature, forward-looking statements involve numerous assumptions, known and unknown risks and uncertainties, both general and specific, that contribute to the possibility that the predictions, forecasts, projections and other forward-looking statements will not occur, which may cause actual performance and results in future periods to differ materially from any estimates or projections of future performance or results expressed or implied by such forward-looking statements. These assumptions, risks and uncertainties include, among other things: the risk that the Proposed Transaction will not be completed or that the necessary approvals and/or exemptions are not obtained or some other condition to the closing of the Proposed Transaction will not be satisfied; the risk that closing of the Proposed Transaction could be delayed if Newcastle and Martello are not able to obtain the necessary approvals on the timelines planned; the risk that the Private Placement will not be completed, the timing of obtaining required approvals, closing conditions for the Proposed Transaction, state of the economy in general and capital markets in particular, investor interest in the business and future prospects of Newcastle and Martello.
The forward-looking statements contained in this news release are made as of the date of this news release. Except as required by law, Newcastle and Martello disclaim any intention and assume no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable securities law. Additionally, Newcastle and Martello undertake no obligation to comment on the expectations of, or statements made, by third parties in respect of the matters discussed above.
Not for distribution to U.S. newswire services or for dissemination in the United States of America. Any failure to comply with this restriction may constitute a violation of U. S. securities law.