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Firelight Corp (C-FRL) - News Release
Firelight to pass torch in change-of-control deal
Firelight Corp FRL
Shares issued 12,246,641 Feb 13 2003 close $ 0.14
Friday March 14 2003 News Release
Mr. Brad Hope reports
LETTER OF INTENT FOR PRIVATE PLACEMENT AND CHANGE OF CONTROL
Firelight has entered into a letter of intent with Nantucket Ventures, LLC of Houston, Tex., Brad Hope and Roy McDonald (directors of the corporation), and Multivision Holdings Ltd. (a company controlled by Mr. Hope and Mr. McDonald), pursuant to which Nantucket will subscribe for a private placement of common shares of the corporation and will acquire an additional 4,749,983 existing common shares of the corporation. These are arm's-length transactions and will result in a change of control of the corporation.
Pursuant to the terms of the letter of intent, Nantucket will acquire a minimum of 10.5 million common shares and a maximum of 15.75 million common shares from the treasury of the corporation at a price of 7.62 U.S. cents (approximately 12 Canadian cents) per share, for total consideration of between $800,000 (U.S.) and $1.2-million (U.S.). In addition, Nantucket will be issued an option to acquire a number of common shares equal to 15.75 million shares less the number of common shares subscribed for by Nantucket under the private placement. The option will have a term of two years from the date of closing and the exercise price under the option will be 9.5 U.S. cents per share. In addition, the letter of intent provides for the acquisition by Nantucket of 4,749,983 currently issued and outstanding common shares of Firelight from Multivision Holdings Ltd., Mr. Hope and Mr. McDonald at an average price of 4.3 U.S. cents per share, for total consideration of $205,015 (U.S.).
Collectively, these transactions will result in Nantucket holding between 15,249,983 and 20,499,983 common shares of the corporation, representing between 65 per cent and 72 per cent of the total outstanding shares upon completion of the transactions. Nantucket is a private Texas company controlled by Jay Haber of Houston, Tex.
In conjunction with the above and under the terms of the letter of intent, Multivision will assign to Firelight all of Multivision's rights and interest in the Accu-Master Golfclub strike, and in return Firelight will assign its rights to the Firelight II barbeque unit to Multivision and all royalty payments from Firelight to Multivision in connection with sales of the Firelight II barbeque unit will cease. The Firelight II barbeque unit has generated nominal revenues for Firelight over the past several years.
Firelight's mission is to provide unparalleled quality and service to the golf playing community. Currently, the corporation is marketing its Butch Harmon line of golf products primarily through retail outlets in Canada, the United States and Asia. Upon completion of the proposed transactions, Firelight will exit the gas grill business and concentrate on becoming one of the leading golf media companies in North America, by providing the highest quality videos and training aids. The corporation will seek to expand its current distribution network as well as its product lines. Emphasis will be placed on direct commercials and a substantial increase in media expenditures. The corporation will evaluate opportunities outside the golfing industry on a very selective basis and go forward with such a product only if it represents an opportunity to create shareholder value through revenue and asset growth. As previously reported, the corporation will seek to finalize its listing on the Nasdaq OTC market in the United States.
In total, $220,000 to $300,000 of the proceeds from the private placement will be used to retire certain outstanding liabilities of Firelight, with the balance of approximately $900,000 to $1.5-million to be used to expand the company's product line, carry out new marketing initiatives and general working capital purposes.
Upon completion of the proposed transactions, it is anticipated that Philip Bucknell, June Hope and Scott Walters will resign as directors of Firelight; Mr. McDonald and Mr. Hope will maintain board positions but shall resign as officers; and the following individuals will be appointed as directors and officers:
Jay Haber, Houston, Tex., proposed chief executive officer and chairman -- Mr. Haber, a private investor, currently serves as an investment banker and management consultant to a number of private and publicly traded companies. Throughout the 1990s, Mr. Haber served as chairman and CEO of Geokinetics Inc., a Houston based publicly based traded company. More recently, Mr. Haber served as CEO of a privately held Internet-based application service provider and technology aggregator for the medical community, as part of his investment banking and management consulting activities; and
Thomas J. Concannon, Houston, Tex., proposed president, chief operating officer and director -- Mr. Concannon currently serves as chief financial officer of a U.S. based Nasdaq OTC bulletin board company. He brings many years of financial and managerial experience to Firelight. Prior to serving in his current position, this individual served as CEO of an operating division of a New York Stock Exchange company as well as serving as a member of the parent company's board of directors.
The proposed transactions are subject to conditions precedent that must be satisfied or waived by the parties before the transaction can proceed, including approval of the TSX Venture Exchange and a complete due diligence review by Nantucket. There can be no assurance that the proposed transactions will be completed as proposed or at all.
Firelight also announces that it has agreed with corporate and Advisory LLC. (controlled by Philip Bucknell, a director of the corporation) that it will pay to that company 25,000 common shares per month for four months at a deemed price of 18 cents per share, for consulting services to Firelight, subject to approval of the TSX Venture Exchange. In addition, Firelight has allocated stock options for 25,000 common shares at an exercise price of 20 cents per share under its stock option plan to Mike England, an investor relations consultant of the corporation, subject to the approval of the TSX Venture Exchange.
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