IBI SIGNS LETTER OF INTENT WITH MEMEX ELECTRONICS INC.
IBI Corporation ("IBI") announced today that it has entered
into a Letter of Intent with Memex Electronics Inc. whereby IBI
has entered into an arrangement to purchase up to 40% of Memex
at a price of $1.8 million, subject to certain conditions
specified below.
Memex is a private company based in Ontario and is the only
designer and manufacturer of NetCNC (Internet computerized
numerical control) hardware and software that networks a head
office to its machine tools through the Internet. Memex''s
technology provides companies with live, real-time, two-way
communication between a head office and its machine tools.
Approximately 90% of Memex''s 1998 revenues of $806,000 were
derived from the manufacture and sale of NetCNC hardware and
software, a 37% increase over 1997 sales. Memex''s net income
for 1997 was $84,815; in 1998 the company reported a net loss
$56,840.
Tom Smeenk, president of IBI commented, "We are quite excited
about this new venture for IBI. IBI becomes the public vehicle
through which investors can own a piece of Memex. Memex''s
technology makes every machine tool a node on the Internet and
allows each circuit board to be assigned an IP (Internet
Protocol) address that is connected via Ethernet to the
corporate LAN. With this technology, manufacturers can now
access, monitor and remotely control their manufacturing
process via the Internet, increasing supervisory control and
data acquisition capability."
Tom Gaasenbeek, president of Memex, said, "We have been
developing this technology since 1992. Our recent success in
retrofitting a flexible manufacturing system at Caterpillar,
which I believe is the first of its kind in terms of ''open''
cellular based manufacturing operation, has demonstrated the
viability of our networking technology. And my involvement as a
member of the Open Modular Architecture Controls standards
committee will help Memex maintain a competitive edge. With
IBI''s investment, we will be the first to market with an
InterNetworking CNC for the OEM machine tool and retrofit
markets."
On signing the Letter of Intent, IBI made an investment of
$150,000 from working capital (taking 3 1/3% of Memex) to
assist Memex with cash flow requirements and, subject to
satisfactory documentation being completed by May 19th and
completion of legal due diligence by May 14th, has an
arrangement to acquire up to 40% of Memex by making staggered
investments totaling an additional $1,650,000 over the next
eight months as follows: $300,000 within 30 days of April 19th,
$250,000 within 60 days of April 19th, and $1.1 million within
8 months of April 19, 1999. The company anticipates that it
will make these payments from its working capital upon the
exercise of outstanding warrants at 6 cents and 10 cents. The
company is currently in negotiations with mining project
lenders to secure approximately U.S. $1 million loan facility,
to start operations at the Namekara vermiculite project.
It is expected that Tom Gaasenbeek, president of Memex, will
join the IBI Board of Directors and Tom Smeenk will join the
Board of Directors of Memex. IBI intends to grant to Tom
Smeenk, its president, the option to acquire, from IBI, up to
5% of the outstanding shares of Memex at its purchase price as
the transaction is successfully concluded. This option will be
subject to all required regulatory and shareholder approvals.
Tom Smeenk, president of IBI, said: "The company''s core focus
will remain to be the development into production of the
Namekara vermiculite and Busumbu phosphate deposits. The
company''s investment in Memex is non-controlling. It is being
made to increase shareholder value, and is taking advantage of
management''s core capabilities to build an enduring
enterprise."
IBI Corporation''s continued quotation on the CDN System will be
subject to IBI continuing to meet CDN''s quotation requirements
on an ongoing basis, including the requirement that IBI
maintain financial resources sufficient to carry out its
business plan in respect of the Uganda project. Currently, IBI
has financial resources sufficient to fund its operations for
Phase I of its exploration programme in Uganda, which is
expected to be complete by June 30, 1999. Pursuant to the joint
venture agreement with International Mining and Development,
IBI is required to fund Phase II of the Uganda project in the
amount of US$450,000 by June 30, 1999 and a further US$496,560
by December 31, 1999.
IBI''s common shares trade on the Canadian Dealing Network under
the symbol IBIC. IBI currently has 200,022,289 common shares
outstanding. For more information, visit Memex''s website at
memx.com.
For further information contact:
Tom Smeenk, President, IBI Tom Gaasenbeek, President, Memex
Tel: (416) 777-1073 Tel: (905) 332-7717
Fax: (416) 777-1206 Fax: (905) 332-6353
E-mail: info@ibicorp.com E-mail: tomg@memx.com
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