CORPORATE NEWS RELEASE
?? TRACER PETROLEUM CORPORATION ??
?? NASDAQ Symbol: TCXXF ?? Dateline: Calgary, AB, Canada
?? Date: Tuesday, August 24, 1999
TRACER TO MERGE WITH INTERNET COMPANY, EZUZ.COM INC. ?
THE GLOBAL SHOPPING NETWORK
TRACER PETROLEUM CORPORATION (?Tracer? or the ?Company?) reports that it has entered into an agreement to acquire all of the issued and outstanding capital stock of eZuz.com Inc., an Internet-based retail shopping network company. Closing of the acquisition is subject to the satisfaction of a number of conditions (as discussed below) including, but not limited to, shareholder and regulatory approval.
ABOUT EZUZ.COM INC.
eZuz.com Inc. (?eZuz? - pronounced ee-zee-use) in collaboration with Inktomi Corporation of San Mateo,
California, is developing a comprehensive shopping network on the Internet. The eZuz.com web site maintains over 400 merchants, offering more than 2 million individual products that have each been integrated into the eZuz Global Shopping Network. eZuz offers all of these products without having to purchase, store, or ship them, thereby offering consumers greater selection and value. As an information distributor, visitors to eZuz can source, research, and purchase products. Using a product?specific search engine, comparisons are made side-by-side, suited to the individual?s tastes and budget.
The eZuz objective is to empower consumers by synchronizing the best available technology with superb customer service through partnerships with retailers and e-commerce merchants. eZuz?s long-term vision is to build a leading-edge network founded on superb people, products, and services.
Mathew Keddy, President and Founder of eZuz.com has stated that ?The process of shifting the balance of information will give shoppers the single, most powerful tool needed to make informed decisions,? said Keddy, ?eZuz strives to be the driver for change. Consumer empowerment is the long-term focus of the eZuz team; we are really only just beginning the process of achieving this goal.?
TERMS OF THE AGREEMENT
The terms of the acquistion are as follows:
1) Tracer?s common shares effectively will be consolidated on a 1-for-4 basis through an exchange of new Tracer Class A common shares for every 4 common shares issued and outstanding.
2) Tracer will acquire 100% of eZuz.com Inc. for 12 million new Class A common shares, on a post-consolidated basis. As a result of the share consolidation and the issuance of the new Class A common shares, the shareholders of Tracer will continue to own approximately 13% of the new Tracer Class A common shares.
3) Tracer?s Board of Directors will be expanded from 5 to 7 members, with eZuz.com nominees being appointed to fill 5 of the Board seats.
4) The Company?s name will be changed from ?Tracer Petroleum Corporation?, to ?eZuz.com
Inc.?.
5) The Company?s corporate headquarters will be moved to the San Francisco, CA, area.
6) The Tracer shareholders of record on the record date for the Extraordinary Meeting of Shareholders, called to approve the terms of the agreement, will also receive in exchange for their common shares, Tracer Preferred shares on the basis of one Preferred share for every 1 common share owned, on a pre-consolidated basis.
7) Tracer?s petroleum assets will be transferred to a new subsidiary, the shares of which will be distributed to Tracer?s shareholders in redemption of the Preferred shares on the basis of 2 shares for every 1 share of Tracer held, on a pre-exchange basis. In other words, none of the 12 million Tracer Class A common shares issued to acquire eZuz.com will be entitled to receive shares in the new subsidiary.
8) (a) The Company must obtain financing of at least US$4 million, which would be primarily used to market the eZuz.com Website (www.ezuz.com).
(b) Tracer must maintain its listing on the NASDAQ Small Cap Market.
(c) Court approval of the terms and conditions of the agreement must be obtained
Tracer intends to hire an investment banking firm, to complete a Fairness Opinion regarding the proposed
acquisition of eZuz.com.
The Company intends to hold an Extraordinary Meeting of the Shareholders, seeking approval of the terms of the agreement as soon as possible and will announce the record date and meeting date when fixed.
TRACER?S PETROLEUM ASSETS
As stated above, and subject to shareholder approval, all of Tracer?s petroleum assets, including the Indonesian assets held through Tracer?s wholly-owned PerminTracer Petroleum Ltd., and any future assets in Iran to be acquired through Tracer Petroleum International Ltd., will be transferred to a new subsidiary. All of the issued shares of the subsidiary will be distributed to the shareholders of Tracer, in redemption of the Preferred shares on the following basis:
1) For every 1 share owned in Tracer, on a pre-exchange basis, a Tracer shareholder will receive
2 shares of the new subsidiary.
2) Only shareholders of record, on the record date of the proposed Extraordinary Meeting of the Shareholders, will be entitled to receive the shares in the new subsidiary. In other words, noneof the 12 million new Tracer Class A common shares to be issued to acquire eZuz.com will be entitled to receive the shares of the new subsidiary.
This new subsidiary, which will likely be called ?Tracer International Petroleum Corporation?, will be headquartered in Calgary, Canada.
FINANCING
Upon final completion of the Company?s recently announced private placement for US$1 million, approximately US$200,000 of the proceeds of the private placement will be used to pay existing debts of Tracer, and the balance will be loaned to eZuz.com for general working capital purposes. If the acquisition of eZuz.com Inc. is not completed, then the loan will be converted into shares of eZuz.com Inc., at a value of US$2.00 per share.
Furthermore, Tracer?s management has begun discussions with a number of investment banking firms and prospective investors regarding the requirement that at least US$4 million be raised as a condition to the closing of the agreement. This financing will likely be completed by way of a private placement of common stock or convertible preferred stock. The proceeds would be primarily used to develop and market the eZuz Global Shopping Network.
THE FUTURE
Commenting on the proposed acquisition of eZuz.com, Tracer?s President and C.E.O., David R. Robinson, states: ?We are extremely excited about this latest chapter in the evolution of Tracer. Through the acquisition of eZuz.com, Tracer?s shareholders will be able to participate in the tremendous growth opportunity presented by the Internet and e-commerce. According to Shop.org, the trade association for online retailers, revenues for online retailing in North America are expected to top US$36 billion by the end of the year. This represents a projected growth rate of 145% for 1999.?
Mr. Robinson further adds: ?We are also very pleased that, through the spin-off of the Company?s petroleum assets into a new subsidiary to be owned by Tracer?s shareholders, our shareholders will continue to retain their interest in these assets, and continue to retain the promise of the Company participating in new petroleum ventures in the Islamic Republic of Iran, and elsewhere.?
Tracer?s Board invites its shareholders, and other interested parties, to visit eZuz.com?s Website, at
www.ezuz.com, and to contact Matthew Keddy, President of eZuz.com, at 604-688-3000.
On behalf of the Board,
TRACER PETROLEUM CORPORATION
?Larry Youell?
Larry W. Youell
Chairman of The Board
This release contains "forward looking statements" as per Section 21E of the US Securities and Exchange Act of 1934, as amended. Although the Company believes that the expectations reflected in such forward looking statements are reasonable, it can give no assurance that such expectations will prove to have been correct. Management is currently reviewing many options and there is no assurance that they will not make decisions other than those now contemplated. The Company is subject to political risks and operational risks identified in documents filed with the Securities and Exchange Commission, including changing and depressed oil prices, unsuccessful drilling results, change of government and political unrest in its main area of operations.
For more information please contact Mr. David Harrison, Corporate Secretary, at (403) 290-1676 at the Company's
headquarters:
TRACER PETROLEUM CORPORATION, Suite #1510, 444 - 5th Ave. S.W., Calgary, AB, T2P 2T8 Canada
Phone: (403) 290-1676 or Fax: (403) 264-5285, "e-mail" tracer@ultranet.ca or web site,
www.hostec.com/tracer
Jim |
