ECC.V
8 Crown Capital Corp -
8 Crown Capital to take over Starfire Technologies
8 Crown Capital Corp
ECC
Shares issued 3,000,000
1999-07-23 close $0.4
Tuesday Aug 3 1999
Mr. Greg Burnett reports
8 Crown Capital has entered into an agreement with Starfire Technologies Inc. to
acquire, by way of a securities takeover circular bid, all of the shares of Starfire.
Incorporated in 1994, Starfire designs, develops and implements interactive
information systems, in addition to providing advertising and marketing services to
the business community, especially the small to medium sector, including
home-based businesses. StarPages is the company's flagship product, an
Internet-based, electronic advertising service. Starfire's corporate mission is to
become the worldwide market leader in the area of local Internet-based
advertising services.
Starfire had revenues of $285,196 in 1998 and $1,203,004 in the six-month
period ended June 30, 1999. As at June 30, 1999, Starfire had assets of
$915,339 including $823,263 in cash, The principals of Starfire are Michael G.
Grenier, David J. Grenier, Stephen Walsh and Peter O'Neill.
Subject to the receipt of approvals of 8 Crown Capital shareholders and
applicable regulatory authorities, 8 Crown Capital will offer a total of 25 million
common shares from treasury to the shareholders of Starfire at a deemed price of
24 cents per share for a total deemed purchase price of $6-million in
consideration of all of the outstanding shares of Starfire. An independent
third-party valuation of Starfire was prepared for the purpose of assisting 8
Crown Capital in determining the purchase price for the Starfire shares.
The consummation of the takeover bid and the closing of the transactions are
conditional upon the completion of due diligence by each of Starfire and 8 Crown
Capital, the receipt of all necessary shareholder and regulatory approvals and
other customary conditions.
Immediately following the closing of the share exchange takeover bid, after receipt
of shareholder and regulatory acceptance, the current members of the board of
directors of 8 Crown Capital, with the exception of Greg Burnett, will resign in
favour of Mr. Michael Grenier, Mr. David Grenier and James N. Morton, a senior
partner of Morton and Company, corporate and securities lawyers.
All of the shares to be issued pursuant to the share exchange takeover bid will be
subject to a one-year hold period pursuant to applicable securities laws and will
be made subject to a pooling agreement, which will provide for the shares' release
on the basis of one-third of the shares on each of the first, second and third
anniversaries of the closing.
The current principals of 8 Crown Capital Corp. have, contemporaneously with
the agreement by 8 Crown Capital to make the takeover circular bid offer,
entered into a share purchase agreement with MCS Investments Inc. The
principals have agreed, pursuant to the terms of the share purchase agreement, to
sell 2,145,000 shares of 8 Crown Capital to MCS for the price of 20 cents per
share. Two million of these shares are subject to escrow restrictions and will be
sold subject to those restrictions. The escrow agreement provides that these
shares will be held in escrow for three years to be released as to one-third on
each of the first, second and third anniversaries of the closing of the share
exchange takeover bid. A total of 145,000 of these shares will be sold to MCS
upon the exercise of management stock options.
MCS Investments Inc. is wholly owned by Mr. Michael Grenier, the chairman,
president and chief executive officer of Starfire.
Upon closing of the transaction, subject to regulatory approval, 8 Crown Capital
intends to grant one million management incentive stock options to directors and
employees of 8 Crown Capital. The options will be exercisable at a price of 40
cents per share for a period of three years from the date of the grant of the
options. A total of 700,000 of these options will be subject to vesting provisions,
which will provide that 350,000 options will vest on each of the second and third
anniversaries of the date of the grant of the options.
Goepel McDermid was the agent and sponsor for 8 Crown Capital's initial public
offering and has agreed to review the proposed transaction with a view to
sponsorship.
About StarPages
StarPages, which was first launched in April, 1997, is a combination of three basic
services consisting of:
an Internet search engine designed specifically to facilitate the easy and effective
connection of buyer and seller on a local, community-based level;
advertising and marketing consulting services with specific emphasis on the
Internet; and
Web site design, creative and hosting services.
StarPages is a substantially enhanced Internet version of the traditional yellow
pages print directory, which can be searched by both business classification as
well as geographical location and provides full-colour visual display
advertisements of suppliers of products and services.
StarPages provides opportunities for all businesses to create a low-cost,
high-quality method for advertising locally through the Internet.
About Starfire principals:
Mr. Michael Grenier is founder, chairman, president and chief executive officer of
Starfire. As the founder and president of Star Data Systems Inc., Mr. Michael
Grenier has extensive experience in creating, developing, marketing, competing
and managing the extremely rapid growth of an international, on-line, real-time,
interactive information company. Under Mr. Michael Grenier's direction, Star
Data Systems became Canada's fastest growing company in 1993, with a
five-year revenue growth in excess of 11,000 per cent.
Mr. David Grenier is executive vice-president of technology of Starfire. Mr. David
Grenier was the primary architect of the information systems developed at Star
Data Systems Inc., which were a major factor in Star Data's growth and became
the platform for all of Star Data's on-line services. Mr. David Grenier has
extensive experience in creating and managing fast-growth, on-line, real-time,
interactive computer networks.
Mr. Walsh, CA, is vice-president of finance of Starfire. Mr. Walsh, a chartered
accountant since 1983, has held progressively senior financial positions at three
companies beginning with Star Data Systems Inc., a telecommunications start-up
company and a specialty broadcaster, all of which were publicly traded. Most
recently, Mr. Walsh was chief financial officer of Asian Television Network
International Limited, a specialty channel broadcasting South Asian programming
to the lndian community in Canada, the United States and the Caribbean.
Mr. O'Neill is vice-president of sale of Starfire. Mr. O'Neill has over 20 years of
experience in the Canadian broadcast industry, most recently as vice-president,
sales and marketing with Alliance Communications (now Alliance Atlantis). At
Alliance, Mr. O'neill was very instrumental in the launch of two successful
specialty television channels -- Showcase and History.
(c) Copyright 1999 Canjex Publishing Ltd. canada-stockwatch.com
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