NOT FOR DISTRIBUTION IN THE UNITED STATES
Azura Ventures Ltd. (TSX VENTURE:AZV.P) (the "Corporation" or "Azura"), a
Capital Pool Company ("CPC") listed on the TSX Venture Exchange (the "Exchange")
announces that it has entered into a Share Purchase Agreement (the "SPA") with
the shareholders of Excellium Technologies Inc. ("Excellium") on December 20,
2011 for the acquisition of all of the issued and outstanding shares of
Excellium (the "Transaction"). The Transaction together with a concurrent debt
or equity financing (as described below) is intended to serve as Azura's
qualifying transaction (the "Qualifying Transaction") under Exchange Policy 2.4
Capital Pool Companies (the "CPC Policy") and remains subject to the approval of
the Exchange. The Corporation intends to list on the Exchange as a Tier 2
industrial issuer upon completion of the Qualifying Transaction. The Transaction
is an arm's length transaction and therefore does not require approval of
Azura's shareholders.
Excellium is a private company based in the Province of Quebec and is
incorporated under the Canada Business Corporations Act ("CBCA") on January 10,
2003. Excellium is a leader in biometric identity systems and proactive security
management. Excellium provides advanced technology- based security solutions
that combine and integrate various security specialties to a broad range of
markets including government, law enforcement agencies, airports, corporations,
as well as organizers of major international events.
Denis Lanteigne, CEO of Azura commented, "Excellium is a company with great
potential in a sector that is growing quickly. The world is moving towards
enhanced security and Excellium is well positioned to establish itself solidly
in this market, to the benefit of our shareholders."
Monique Imbeault, a director of Excellium remarked, "Combining forces with Azura
and going public is a strategic step for Excellium at this stage of its
development. This transaction will assist us in our expansion throughout Canada
and in competing for significant contracts abroad."
The Transaction
The SPA contemplates that, subject to the fulfillment of certain conditions,
Azura will issue 29,205,000 common shares in the capital of Azura to the
shareholders of Excellium for the acquisition of all of the issued and
outstanding common shares of Excellium, including Excellium common shares to be
issued pursuant to the conversion of amounts due to General Financial
Corporation Ltd. ("GFC"). The Azura common shares to be issued to the
shareholders of Excellium will be at a deemed price of $0.12 per share,
representing a total consideration payable of $3,504,600. There are currently
9,735,000 issued and outstanding common shares in the capital of Azura.
Therefore upon closing of the Transaction, the current shareholders of Azura
will own approximately 25% of Excellium Inc. (the "Resulting Issuer"). See
"Arm's Length Transaction and Matters to be Submitted to Azura Shareholders"
below.
GFC, a company wholly-owned by Bernard Imbeault and resident in the Province of
New Brunswick, currently owns 100% of the issued and outstanding shares of
Excellium. It is anticipated that prior to the completion of the Transaction,
Jean-Claude Siew, the Chief Executive Officer of Excellium, will acquire 10% of
Excellium common shares. Mr. Siew is resident in the Province of Quebec.
Assuming the completion of the acquisition of Excellium shares by Mr. Siew,
prior to closing of the Transaction GFC will own 90% of the issued and
outstanding share of Excellium and following completion of the Transaction GFC
will hold approximately 67.5% of the Resulting Issuer.
It is anticipated that following the Transaction, the two entities will amalgamate.
Sponsor
Union Securities Ltd. (the "Sponsor"), subject to the completion of satisfactory
due diligence, has agreed to act as sponsor in connection with the Qualifying
Transaction. The Sponsor will be paid a sponsorship fee and as part of its
remuneration, on the closing of the Qualifying Transaction, will be issued
warrants enabling the purchase of up to 250,000 shares of the Resulting Issuer
at an exercise price of $0.15 per share for a period of 24 months.
Arm's Length Transaction and Matters to be Submitted to Azura Shareholders
No insiders of Azura has a beneficial interest in or owns or exercises control
over any common shares of Excellium or GFC shares and therefore the Transaction
is not a "Non Arm's Length Qualifying Transaction" as defined in the CPC Policy.
Although Azura will not seek shareholder approval for the Transaction, Azura
anticipates that it will seek shareholder approval at its annual and special
shareholders meeting to be held on February 17, 2012, to, upon completion of the
Qualifying Transaction, (i) change the Corporation's name to "Excellium Inc."
and (ii) permit the continuance of Azura from the Business Corporations Act (New
Brunswick) to the CBCA. If Azura's shareholders approve such resolutions,
subsequent to the completion of the Qualifying Transaction, the Resulting Issuer
will continue under the CBCA, change its name from Azura Ventures Ltd. to
"Excellium Inc." and complete a short form vertical amalgamation.
Assets of the Resulting Issuer
Excellium, with facilities in Ville St-Laurent, Quebec, is an integrator of
security products for the institutional and industrial markets. Excellium is
active in two distinct but related lines of business:
-- Background checks and biometric identification; and
-- Security management, access control and video surveillance.
Background checks and biometric identification
Excellium possesses the intellectual properties related to the UNI suite of
software. UniDAC is an Automated Finger Identification System, capable of
communicating with the RCMP database for the purpose of background checks. Two
versions are offered, UniDAC Pro is used by police forces as a Criminal Judicial
Identification Management whereas UniDAC Standard is sold to companies as a
civil version of Background Checks Management. UniGEA and Unic-ID are used in
delivering accreditation services for large international events such as the
recently held G20 and G8 summits in the Toronto area, and the 2011 visit of
Prince William and Kate Middleton to Canada. Clients include the RCMP, the
Canadian Air Transport Security Authority (CATSA) and the police forces in
Quebec and Ontario.
Security management, access control and video surveillance
Excellium provides customized solutions that seamlessly integrate across
multiple security applications including access control, analytic video
surveillance and intrusion detection as well as linking to critical business
systems such as human resources, identity management and enterprise resource
planning (ERP). Excellium is a certified Honeywell Integrated Security (HIS)
system integrator. Excellium owns and markets the Controlperfect suite of
software comprised of seven modules, namely: Accessperfect, Equipmentperfect,
IDperfect, Keyperfect, Reportperfect, Tourperfect and Visitorperfect. This suite
of products provides comprehensive decision-making software solutions to
security managers. Clients include large corporations, municipalities, public
services organizations and universities.
New product in development
Excellium is working on new technology for home detention electronic monitoring.
This technology would be used to manage low risk home detention while improving
public safety.
The following is a summary of Excellium financial information prepared in
accordance with generally accepted accounting principles for Canadian private
companies. The ten month interim financial statements have been prepared by
management whereas fiscal years 2009 and 2010 were prepared under a review
engagement by an independent accounting firm.
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Interim at Fiscal Fiscal
October 2011 2010 2009
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Assets $2,234,939 $2,623,192 $2,543,667
----------------------------------------------------------------------------
Current liabilities $1,100,427 $851,038 $879,756
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Working capital $123 652 $927,713 $1,013,020
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Long-term debt $117,431 $0 $0
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Due to a shareholder - GFC $4,081,074 $3,946,074 $3,930,074
----------------------------------------------------------------------------
Shareholder's deficiency $3,063,993 $2,173,920 $2,266,163
----------------------------------------------------------------------------
Sales $2,961,156 $6,925,024 $6,814,519
----------------------------------------------------------------------------
Net income (loss) $(890,074) $92,243 $1,530,097
----------------------------------------------------------------------------
As a pre-closing condition, the due to a shareholder - GFC will be converted
into common shares of Excellium. Excellium will be preparing audited annual
financial statement for its fiscal year ending December 31, 2011, which
financial statements will be included in the Azura Filing Statement to be
prepared and filed on SEDAR prior to the completion of the Transaction, as is
required by the CPC Policy.
Directors and Management of the Resulting Issuer
It is anticipated that the Board of the Resulting Issuer will be comprised of
seven directors. As of this date, the following individuals are proposed to be
directors and executive officers of the Resulting Issuer following completion of
the Transaction:
Monique Imbeault, LLB, Director and Chair of the Board
Mrs. Imbeault is the Chair of Imvescor Restaurant Group Inc. (TSE:IRG) since
March 2011, along with being a Director since January 2011. Mrs. Imbeault is the
CEO of GFC, a diversified holding of mostly wholly-owned companies. She provides
strategic counsel and management oversight to these companies to ensure long
term profitability. With Excellium, Mrs. Imbeault has worked closely with
management during the past two years as a Director and Officer. Prior to joining
GFC, she was Counsel with the firm of McInnes Cooper where she specialized in
corporate and trademark law for 10 years. Previous experience includes chemical
research in Toronto, technical sales in Montreal, both in the pulp and paper
division of C.I.L. Inc. and entrepreneurial and business experience, having
owned and operated Pizza Delight restaurants for over eight years. Mrs. Imbeault
recently completed the Rotman School of Management's Financial Literacy for
Directors and the Director Education Program. She received the ICD.D designation
granted by the Institute of Corporate Directors in 2011.
Jean-Claude Siew, P.Eng., President, Chief Executive Officer and Director
Since 2007, Jean-Claude Siew has been the President and Chief Executive Officer
of Excellium where he has integrated access control, video surveillance to
software and biometric identification. Before taking the helm of Excellium, Mr.
Siew accumulated over 20 years of experience, particularly in managing large
projects, at CAE Inc., which he joined in 1986. From 1988 to 2007, Mr. Siew
successively became Project Director, Director of Business Development,
Vice-President of Immersive and Viewing Systems, and Vice-President of Systems
Engineering. Mr. Siew graduated from l'Ecole Polytechnique de Montreal in
Engineering.
Jacques Duchesneau, C.M., C.Q., C.D., Director
Mr. Duchesneau is an associated professor at l'Ecole Nationale d'Administration
publique du Quebec since 2009. He recently led a Province of Quebec Task Force
investigating potential collusion in the road construction industry. Mr.
Duchesneau was named the very first CEO of CATSA; a federal crown corporation
tasked with the implementation of air transport security and held that position
from 2002 to 2008. From 1999 to 2002, he was employed in senior positions with
private sector companies, notably Datacom Wireless. He has had a long and
distinguished career from 1968 to 1998 with the Montreal City Police culminating
with five years as Chief of Police. Mr. Duchesneau has served on numerous boards
of directors over the last 25 years, including Garda World (TSX:GW) from 1999 to
2002. He is currently writing a thesis to earn a Ph.D. Philosophy from the Royal
Military College based in Kingston, Ontario. Mr. Duchesneau holds a Master in
Public Administration earned in 1988. In 1996, he was named Member of the Order
of Canada (C.M.). He was also bestowed the title of Knight, Ordre national du
Quebec (C.Q.) and was awarded the Canadian Decoration (C.D.).
Ross Finlay, Director
Ross Finlay, a Director of Azura, is a co-founder and Director of the First
Angel Network Association since 2005. This group is an Atlantic Canadian
association for private investors. Mr. Finlay manages a portfolio of about
eighteen angel investments in promising early-stage technology companies. An
angel investor since 2000, he owns a consulting practice, Grey Matter
Development Limited, where he assists a number of companies raise private equity
and provides enterpreneurial training. He is a recognized facilitator, business
planner, and strategic change advisor who has an extensive background in public,
private and not-for-profit sectors. From 2000 to 2002, he served as Director of
Corporate Services at SolutionInc Ltd. (TSX:STL). In 1972, Mr. Finlay earned a
Business Administration degree from Humber College in Toronto.
David Holt, CA, Director
Mr. Holt is a Director and Chair of the Audit Committee of Azura. He serves as
President of Modern Enterprises Limited and the Modern Group of Companies. With
over 200 employees, the Modern Group operates within the construction sector
manufacturing explosives, processing aggregates and asphalt, and constructing
highways, bridges and industrial/commercial buildings. Prior to joining Modern
in 1994, Mr. Holt was a partner with Grant Thornton, Chartered Accountants. From
2005 to 2009, Mr. Holt served as an independent director of Landdrill
International Inc. (TSX:LDI). During that period he was the Chair of Landdrill's
Audit Committee. He earned his Chartered Accountant designation in 1977 and
holds a Bachelor in Business Administration from Acadia University, 1972.
Denis Lanteigne, CA, CF, Director
Mr. Lanteigne is currently the President, CEO and a Director of Azura. He is
employed by the Atlantic Canada Opportunities Agency, an economic development
unit of the Government of Canada since November 2002. In October 2008, he
founded Kice Capital Inc. as President. From 1998 to 2002, he ran a consulting
practice, serving selected technology companies and the Caisse de depot et
placement du Quebec as manager of Acces Capital Acadie, for whom he sought and
completed private equity investments. From 1996 to 1998, Mr. Lanteigne worked at
Deloitte as a Senior Manager within the Corporate Finance Group. In 1987, he
obtained a Bachelor in Business Administration from the Universite de Moncton
and, in 1991, the designation of Chartered Accountant. In 2007, Mr. Lanteigne
earned the recognition of the Corporate Finance Qualification Program of the
Canadian Institute of Chartered Accountants and is one of a few hundred
professionals in Canada with the right to use the letters "CF".
Denis Bourget - VP and Chief Security Officer
Denis Bourget has been directly involved in the Canadian security industry for
almost 30 years. From 1977 to 1996, Mr. Bourget performed different functions
from operating an alarm central to selling large integrated security systems. In
1996, Mr. Bourget founded Les Logiciels Sirius Inc. and served as its Chief
Executive Officer. He developed and marketed the Controlperfect software suite,
which manages the physical security of institutions and companies, some of which
are part of the Canadian "Fortune 500." Mr. Bourget is a Certified Protection
Professional (CPP).
Sylvain Lemieux - VP Business Development and Special Projects
In 1995, Sylvain Lemieux co-founded Unicom, where he held the position of
Director of Technologies and oversaw the UniDAC and UniGEA projects. Mr. Lemieux
supervised all aspects of research and development. In 1997, Mr. Lemieux led
Unicom's technical team responsible for the design and development of the UniGEA
software, which manages the logistics coordination, the accreditation and the
security during important events. Mr. Lemieux was responsible for development
and maintenance during various important events that have used UniGEA. He was
responsible for the technical and accreditation team. Mr. Lemieux is a Project
Management Professional (PMP).
Claude Roussin, CA - VP Accounting and Interim Secretary
Claude Roussin has worked within national distribution and retailing companies
where he has acquired an expertise in internal control, financial analysis,
information management and general administration. Throughout his career, Mr.
Roussin has had experience with the accounting, financial, judicial and managing
aspects of company management. Mr. Roussin earned the Chartered Accountant
designation in 1979.
Bernard Imbeault
Although Mr. Imbeault will not be actively involved with the Resulting Issuer,
he will be considered an insider by virtue of his ownership of GFC. The founder
of Imvescor Restaurant Group Inc. (TSE:IRG), Mr. lmbeault has a long career as
an entrepreneur, starting with the acquisition of Pizza Delight Corporation in
1969, one year after its inception. Forty-two years later, this company with
over 250 restaurants is a significant part of IRG. He owns GFC, a diversified
holding which, over the years, acquired businesses in a variety of sectors with
Mr. Imbeault playing an active strategic role until his recent retirement. He
has held positions on boards of directors of a number of private companies and
organizations. Mr. Imbeault holds a BA in Economic Science, a Masters in
Commercial Science (Management) and a Masters in Business Administration
(Finance) while also completing postgraduate studies at the Ecole nationale
d'administration in France. In 2003, Mr. Imbeault received an honorary Doctorate
in Business Administration from the Universite de Moncton and in 2004, an
honorary Doctorate in Law from Mount Allison University. In 2003, Mr. Imbeault
was awarded the Ernst & Young Atlantic Entrepreneur of the Year as well as being
a Top 50 CEO from the Atlantic Business Magazine. He received the Paul Harris
Award from the Rotary Club of Greater Moncton for his service to the community.
Inducted to the New Brunswick Business Hall of Fame in 2005, he was named the
Atlantic Business Magazine's CEO of the Year in 2006 and was also inducted to
the Top 50 CEO Hall of Fame by the Atlantic Business Magazine in 2007. In 2008,
he received the Order of Merit from the Universite de Moncton Alumni Association
and was presented with the Order of New Brunswick. In 2009, Mr. Imbeault was
nominated as Honorary Lieutenant-colonel for the Fusilliers du St-Laurent by the
Minister of Defense, Mr. Peter McKay.
In addition to the individuals listed above, a seventh director will be
nominated subject to Exchange approval. In addition, the Chief Financial Officer
of the Resulting Issuer has yet to be named. Further disclosure regarding these
nominations and officers will be made in future news releases.
Concurrent Financing
Subject to all regulatory approvals, Azura and/or Excellium will secure a
minimum of $1,000,000 in additional financing that will be used to (i) finance
the execution of the Resulting Issuer's business plan, (ii) pay for costs
associated with the Qualifying Transaction, and (iii) finance certain general
corporate expenditures. This financing may be structured as equity, debt or a
combination thereof and may be invested in either company prior to, or at the
closing of the Transaction. Should the capital be raised through an equity
financing into Azura prior to the Transaction, the new common shares of Azura
will not be issued at a price less than $0.12 per share. Any equity financing
will result in dilution to the shareholders of the Resulting Issuer. At this
time the Corporation does not plan to engage the services of a registered dealer
or other adviser with respect to any financing but may do so in the future,
subject to Exchange approval.
Conditions to the closing of the Qualifying Transaction
The closing of the Qualifying Transaction is subject to a number of terms and
conditions including:
a. completion of operational, financial and legal due diligence by each of
Azura and Excellium;
b. approval by the Boards of Directors of Azura, Excellium and GFC;
c. the absence of any judgment, injunction, order or decree adversely
affecting or prohibiting the Transaction, or of a material adverse
change in the business, affairs or results of operations of either
party;
d. compliance in all material respects by Azura and Excellium with their
covenants and truth of representations and warranties provided for in
the definitive agreement as at closing;
e. conversion of the due to a shareholder - GFC into common shares of
Excellium;
f. receipt of a satisfactory Report of the Sponsor; and
g. approval of the Qualifying Transaction by the Exchange.
Azura Ventures Ltd.
Azura was incorporated on May 22, 2009 under the Business Corporations Act (New
Brunswick). Trading of the common shares of Azura has been halted since November
16, 2011 and it is anticipated that trading will remain halted pending the
Exchange's receipt and review of satisfactory documentation.
As at the date hereof, there are 9,735,000 common shares in the capital of Azura
issued and outstanding. In addition, Azura currently has 908,600 outstanding
options issued in 2010 to its directors and officers, entitling them to purchase
a total of 908,600 common shares of Azura at a price of $0.10 per share. There
are also 513,500 Azura warrants outstanding, such warrants entitling the holders
to purchase a total of 513,500 common shares of Azura at a price of $0.10 per
share. These warrants were issued as part of the compensation paid to the agents
at the closing of Azura's initial public offering and such warrants expire on
June 7, 2012.
Other Information and Updates
Azura and Excellium will continue to provide further details in respect of the
Qualifying Transaction, in due course, by way of press release.
This press release contains forward-looking statements with respect to the
Transaction, the financing, and matters concerning the business, operations,
strategy and financial performance of Excellium and the Corporation. All
statements, other than statements of historical fact, which address activities,
events or developments that we expect or anticipate may or will occur in the
future are forward-looking information. Forward-looking information typically
contains statements with words such as "may", "estimate", "anticipate",
"believe", "expect", "plan", "intend", "target", "project", "forecast" or
similar words suggesting future outcomes or outlook. The within discussion is
intended to identify certain factors, although not necessarily all factors,
which could cause future outcomes to differ materially from those set forth in
the forward looking information. Examples of such statements include the
intention to complete the Transaction, pass annual and special business at the
meeting of Azura shareholders, completion of a debt or equity financing,
completion of the Qualifying Transaction and development of a new product by
Excellium. Actual results and developments are likely to differ, and may differ
materially, from those expressed or implied by the forward-looking statements
contained in the press release. Such forward-looking statements are based on a
number of assumptions which may prove to be incorrect, including but not limited
to: the ability of the Corporation and/or Excellium to obtain the necessary
financing; the ability of the Corporation or the Excellium shareholders to
satisfy the conditions under the SPA; the ability of the Corporation satisfy the
requirements of the Exchange with respect to the Qualifying Transaction; the
continuation or growth of opportunities for Excellium and the Resulting Issuers
and its ability to develop and expand its business internationally; general
economic and market factors; changes in government regulation; competition;
continuing and growth in customer interest in Excellium's services and products;
and anticipated and unanticipated costs.
Although the Corporation has attempted to identify important factors that could
cause actual actions, events or results to differ materially from those
described in forward-looking statements, there may be other factors that cause
actions, events or results not to be as anticipated, estimated or intended.
There can be no assurances that forward-looking statements will prove to be
accurate, as actual results and future events could differ materially from those
anticipated in such statements. Accordingly, readers should not place undue
reliance on forward-looking statements. The forward-looking statements contained
herein are made as of the date hereof and Azura does not undertake any
obligation to update publicly or to revise any forward-looking information
whether as a result of new information, future events or otherwise, except as
required by law. Any forward-looking information contained herein is expressly
qualified by this cautionary statement.
Completion of the Transaction is subject to a number of conditions, including
but not limited to, further due diligence, Exchange acceptance, and directors
approval. 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 Azura Filing Statement
to be prepared in connection with the 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 Azura should be
considered highly speculative.
Union Securities Ltd., subject to completion of satisfactory due diligence, has
agreed to act as sponsor in connection with the transaction. An agreement to
sponsor should not be construed as any assurance with respect to the merits of
the transaction or the likelihood of completion.
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