Manado Gold Corp. - Corporate Reorganization
![Manado Gold Corp. - Corporate Reorganization](https://www.minenportal.de/media/goldseiten-news.jpg)
Vancouver, BC / TheNewswire / September 10, 2015 / Manado Gold Corp. ("Manado") (TSX-V: MDO) announced today that its directors have approved of a re-organization consisting of:
-
1)An amalgamation (the "Amalgamation") under an Amalgamation Agreement dated effective September 8, 2015 between Manado and RewardStream Inc. to create an amalgamated entity called RewardStream Solutions Inc. ("Solutions"); and
-
2)The spinoff (the "Spinoff"), to the existing shareholders of Manado immediately before closing of the Amalgamation, of the shares of Manado's mineral property subsidiary, MDO Mining Corp. (the "Subsidiary"). The Spinoff will be on the basis of one share of the Subsidiary for each 10 shares of Manado held.
The Transactions will constitute a reverse takeover and change of business. The Amalgamation will be on the following basis:
-
1)Shareholders of Manado will receive one share of Solutions for each four shares held of Manado; and
-
2)Shareholders of RewardStream will receive 3.5 shares of Solutions for each share held of RewardStream.
Completion of the Amalgamation is subject to a number of conditions including:
-
a)Completion of the transfer of Manado's mineral properties to the Subsidiary and the assumption by the Subsidiary of all obligations related to Manado's mineral properties;
-
b)Completion of two part and parcel private placements including:
-
i)an interim private placement (the "Interim Private Placement") of 12,000,000 units at a price of $0.05 per unit, with each unit consisting of one common share and one common share purchase warrant exercisable to purchase an additional common share at a price of $0.075 per share for a period of two years from the date of issuance. The Company will pay commissions or finders fees where permitted of up to 10% of the gross proceeds. The Interim Private Placement will be completed prior to closing to provide interim financing from Manado to RewardStream of $500,000 and to pay costs of the re-organization. Placees of the Interim Private Placement will participate in the Spinoff; and
-
ii)a subsequent private placement to be completed concurrently with closing of the Amalgamation (the "Concurrent Private Placement") consisting of 5,360,000 units of Solutions at a price of $0.28 per unit with each unit consisting of one common share and one-half of one common share purchase warrant, with each whole warrant entitling the holder to purchase an additional common share of Solutions at a price of $0.40 per share for a period of two years from the date of issuance. The proceeds of the concurrent private placement will be to fund the marketing efforts of Solutions and for general corporate purposes;
-
c)Shareholder approvals by both companies;
-
d)Termination of all Manado and RewardStream option agreements;
-
e)Exercise of all RewardStream outstanding warrants;
-
f)The entry by RewardStream shareholders into such escrow agreements as may be required by the TSX Venture Exchange and the entry of RewardStream shareholders who are not required to be escrowed into pooling agents providing for releases of shares over a one-year period;
-
g)The advance of $500,000 by way of loans to RewardStream from Manado;
-
h)Regulatory approvals, including TSX Venture Exchange approval; and
-
i)The payment by Manado of all amounts owed to Manado directors and officers.
Immediately prior to the Amalgamation closing, assuming completion of the Initial Private Placement, Manado will have 68,375,201 shares outstanding which will be converted into 17,093,800 shares of Solutions (approximately 30%) and RewardStream will have 11,612,576 shares outstanding which will convert into 40,644,016 shares of Solutions (approximately 70%). After completion of the concurrent private placement, the total shares of Solutions outstanding will be 63,097,816. On closing, the former shareholders of RewardStream will hold approximately 64.5% of Solutions, the former shareholders of Manado will hold approximately 27% of Solutions and the Concurrent Private Placement will represent approximately 8.5% of the shares of Solutions then outstanding.
Solutions will pay a finder's fee consisting of $35,000 cash and 900,000 common shares of Solutions to Denise Trainor of Vancouver, BC.
RewardStream is engaged in the business of designing, administering and managing automated referral and recommendation marketing programs. Its current customers are primarily telecommunications providers, financial institutions and e-commerce companies. Their platform, however, is adaptable to different types and sizes of customers. Current customers include Koodo Mobile, Boost Mobile, Virgin Mobile, Rogers, a major U.S. mobile phone company, First Calgary Financial and First West Credit Union. Although not currently profitable, RewardStream has significant revenues from operations as follows:
Financial Period | Revenues* | Gross Margins* |
Audited September 30, 2013 (Fiscal Year) | 2,079,258 | 1,242,437 |
Audited September 30, 2014 (Fiscal Year) | 1,859,690 | 800,897 |
Unaudited June 30, 2015 (9 Month) | 1,287,964 | 737,066 |
* adjusted to remove revenue of 1,827,660 and gross margins of 1,335,658 resulting from non-recurring sale of software.
Over the past 12 months RewardStream has shifted its business model from primarily a one-time sale and professional services model to a scalable recurring, software as a services (SaaS) model. While this has resulted in the decline in short term revenues, RewardStream intends to use the funds from the private placements to expand marketing and sales efforts, scale product and support functions with the intention of increasing revenues and becoming profitable.
Logan Anderson
President
For further information, please contact:
Logan Anderson
Phone: (604) 685-4745
Email: manadogold@outlook.com
or
Investor Relations
Dave Ryan
Email: manadogold@outlook.com
Forward-Looking Statements Information set forth in this news release contains forward-looking statements that are based on assumptions as of the date of this news release. These statements reflect management's current estimates, beliefs, intentions and expectations. They are not guarantees of future performance. Manado cautions that all forward looking statements are inherently uncertain and that actual performance may be affected by a number of material factors, many of which are beyond Manado's control. Such factors include, among other things: risks and uncertainties relating to Manado's limited operating history; the need to comply with environmental and governmental regulations; and potential defects in title to Manado's properties. Accordingly, actual and future events, conditions and results may differ materially from the estimates, beliefs, intentions and expectations expressed or implied in the forward looking information. Except as required under applicable securities legislation, Manado undertakes no obligation to publicly update or revise forward-looking information.
NEITHER TSX VENTURE EXCHANGE NOR ITS REGULATION SERVICES PROVIDER (AS THAT TERM IS DEFINED IN THE POLICIES OF THE TSX VENTURE EXCHANGE) ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.
Copyright (c) 2015 TheNewswire - All rights reserved.