Here's the news release.
Nu-Lite Industries Ltd -
Nu-Lite developments on proposed acquisition
Nu-Lite Industries Ltd NLE
Shares issued 9,206,784 1999-10-14 close $0.52
Wednesday Dec 8 1999
Mr. Kenneth Trociuk reports
Nu-Lite Industries reports the following developments related to the proposed acquisition of Netseers Internet Corporation, pursuant to the company's news releases in Stockwatch June 18, 1999, and Oct. 14, 1999.
Current business
The company's past/current business operations have been in the exploration of mineral resource properties. The company currently holds certain mineral claims relating to its Keystone property in Northern British Columbia.
Proposed business
The company intends to change the focus of its business operations from mineral exploration to Internet-related businesses by acquiring Netseers. Netseers is a private B.C.-based company.
Acquisition Terms: Compensation paid by the company to acquire Netseers includes: (a) $30,000, (b) issuance of up to 1.2 million trading shares, and (c) issuance of up to two million performance shares to be released in accordance with criteria acceptable to the regulatory authorities.
Business of Netseers: Netseers is an Internet-based company that plans to develop the Internet projects noted below. These projects cover various industries. Project one is a Web site design and hosting company. This project is currently operational. Project two is a Web site that will allow consumers to review and make on-line purchases of numerous computers and computer components from a variety of suppliers. The company expects this project to be operational within three months. Project three is an on-line interactive bingo/gaming Web site. The company expects this project to be operational within six months.
Commercialization of the above three projects will involve reaching various milestones including: development of various software and programs, recruitment of competent employees, and implementation of an appropriate marketing and promotion strategy. Following the development of these projects, the company may pursue additional projects in other industries such as on-line advertising, on-line auctions, and on-line domain referral services.
Financial description of Netseers: The following information is summarized from Netseers' audited financial statements for the four months ended Aug. 31, 1999:
Total revenue $ 0
Net loss 37,577
Total assets 24,080
Long-term liabilities 0
Management of Netseers: The two key principals of Netseers are Neil Mikkelsen and Chris Giroux. Mr. Mikkelsen has a variety of business-related experience. His primary responsibilities are expected to include overseeing day-to-day operations and the advertising/marketing functions. Mr. Giroux's experience includes the architectural and software development fields. His primary responsibilities are expected to be software development/technical matters.
Following the completion of the company's acquisition of Netseers, the company's directors and officers are expected to be:
Kenneth Trociuk, president, chairman, and director; Thomas Kennedy, director; Wally Boguski, director; Mr. Mikkelsen, chief executive officer, director; and Mr. Giroux, director.
Financing
The development of the above Netseers projects is expected to be primarily financed through a brokered private placement yielding net proceeds of approximately $900,000. These funds are expected to be allocated: 36 per cent to salaries (management, administrative staff, software programmers, project managers, sales staff), 25 per cent to software development, 12 per cent to advertising and promotion, and 27 per cent to unallocated working capital.
Member firm involvement
Georgia Pacific Securities Corporation has agreed, subject to satisfactory completion of its due diligence reviews, to:
act as sponsor regarding the company's change of business, and act as agent, on a best efforts basis, regarding the company's BPP.
GPSC has requested that the Canadian Venture Exchange reinstate trading in the company's common shares concurrently with the issuance of this news release. Investors must appreciate that there is no assurance that the company's proposed acquisition of Netseers will be completed.
Capital structure
The company's capital structure includes the following:
The company currently has 11,840,356 issued and outstanding shares;
1.09 million stock options and 630,500 share purchase warrants are currently issued.
A BPP of 1.7 million units at 60 cents per unit is proposed.
A shares for debt agreement involving 5,006,775 shares to be conducted following certain approvals.
Vend-in consideration of up to 1.2 million free-trading shares and two million performance shares is proposed.
Due diligence conducted by the company's management
Prior to deciding to acquire Netseers, the company's management conducted due diligence on Netseers. This due diligence included, but was not limited to, the following:
reviewing the current and proposed operations of Netseers;
reviewing the management of Netseers; and
commissioning and reviewing an independent valuation of Netseers.
Risks
The company believes the acquisition of Netseers represents an opportunity for success. However, the company recognizes Netseers, as a start-up firm, will face intense competition from other Internet companies that are more established and that possess greater resources. As such, no assurances exist that Netseers will either obtain its stated corporate objectives in the expected time frame or that attainment of such objectives will lead to corporate profitability. In addition, no assurances exist that Netseers will be able to obtain all required financing or recruit all needed staff in order to carry out its business plan.
Finally, the company's acquisition of Netseers remains subject to all required regulatory approvals as well as confirmation of GPSC sponsorship following completion of its due diligence reviews. Accordingly, there is a risk that the acquisition of Netseers may not be accepted by the regulatory authorities, or the terms may be altered before such acceptance.
WARNING: The company relies upon litigation protection for "forward-looking" statements.
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