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Vector Resources Inc. Provides Update on Proposed Qualifying Transaction

FSCWIRE

Vector Resources Inc. Provides Update on Proposed Qualifying Transaction

Toronto, Ontario (FSCwire)Vector Resources Inc. (Vector” or the “Corporation”), a capital pool company, is pleased to provide the following update regarding its proposed business combination (the “Proposed Transaction”) with Tectonica Australia Pty Ltd. (“Tectonica”) as announced in its September 21, 2015, November 5, 2015, January 8, 2016 and March 17, 2016 press releases, which Proposed Transaction is intended to constitute a “Qualifying Transaction” as such term is defined in Policy 2.4 of the TSX Venture Exchange (“TSXV” or the “Exchange”).

Transaction

Vector and Tectonica will complete the proposed transaction by way of a share exchange that will result in all of the issued Tectonica Shares (as defined below) on or before the Closing Date (as defined below) in exchange for common shares of Vector (the “Share Exchange”) on the basis of approximately 38.1 pre-Consolidation common share in the capital of Vector (the “Vector Shares”) for each one (1) ordinary share in the capital of Tectonica (a “Tectonica Share”). Upon completion of the Share Exchange, Tectonica’s current shareholders will hold approximately 96.526% of the Vector Share issued and outstanding common shares of Vector, on a post-Transaction basis prior to closing the Private Placement, and Vector’s current shareholders will hold approximately 3.474% of the issued and outstanding common shares of Vector, on a post-Transaction basis prior to closing the Private Placement.

Immediately following the issuance of the Vector Shares pursuant to the Share Exchange and the closing of the Private Placement (see below), Vector will complete the Consolidation on the basis of one (1) post-Consolidation Resulting Issuer Share for six (6) pre-Consolidation Vector Shares.

The proposed share capital of the Resulting Issuer after giving effect to the Proposed Qualifying Transaction and the Consolidation:

Amount Outstanding (and percentage) after giving effect to the Minimum Amount under the Private Placement

Amount Outstanding (and percentage) after giving effect to the Maximum Amount under the Private Placement

Resulting Issuer Shares held by current Vector Shareholders

622,704

(2.77%)

622,704

(2.61%)

Resulting Issuer Shares held by Private Placement participants

4,538,737

(20.21%)

5,972,901

(25.00%)

Resulting Issuer Shares to be issued on Closing in exchange for Tectonica Shares held by the Original Tectonica Shareholders

17,300,283

(77.02%)

17,300,283

(72.40%)

Total Issued

22,461,724

(100%)

23,895,888

(100%)

Resulting Issuer Shares reserved for issuance upon the exercise of the Vector Options under the Vector Stock Option Plan

37,715

37,715

Total Reserved for Issuance

22,499,439

23,933,603

Summary of Tectonica Financial Information

The following is selected financial data derived from the Tectonica Financial Statements as follows:

Financial Period

Six Month Period ended December 31, 2015 (unaudited)

Year ended June 30, 2015

(audited)

Year ended June 30, 2014

(audited)

Year ended June 30, 2013

(audited)

Total revenue

AUD$1,293,285

AUD$5,219,870

AUD$7,882,613

AUD$3,350,035

Net cash provided by (used in) operating activities

(AUD$1,441,288)

AUD$1,200,286

AUD$1,135,767

(AUD$1,614,317)

Total comprehensive income

(AUD$264,121)

AUD$661,891

AUD$1,359,392

AUD$280,700

Total assets

AUD$6,275,339

AUD$5,298,698

AUD$7,370,577

AUD$5,900,182

Total non-current financial liabilities

AUD$1,947,228

AUD$1,451,176

AUD$3,424,866

AUD$2,202,468

Cash dividends declared

Nil

Nil

Nil

Nil

Proposed Officers of the Corporation on a Post-Transaction

Upon completion of the Transaction, it is contemplated that the officers of the Corporation will be as follows:

David M. Levy,

President and CEO

Mr. Levy joined Tectonica Australia Pty Ltd. in January 2007 after returning from the United Kingdom where he held the positions of Biological Project Manager and Product Development Manager at Smiths Detection, a Division of Smiths Plc.

At Smiths Plc. Mr. Levy managed a team of scientists and engineers that were responsible for the development of biological detection and identification technology and products for application in the defence and law enforcement sectors. During this period, he was involved in a number of technology commercialisation ventures in Europe and the US.

Mr. Levy was appointed to Tectonica’s Board of Directors in January 2010, and was appointed Managing Director in 2014. During his period at Tectonica Mr. Levy has secured significant contracts with the Australian Department of Defence, formed strategic partnerships with local and international Defence organisations, established technology partnerships with government research agencies and commercialized Tectonica’s Intellectual Property through product development. Mr. Levy has overseen the transition of Tectonica from an Australian engineering service provider to an exporter of innovative products to global markets.

J. Miles Partridge,

Technical Director

Mr. Partridge has managed projects in the fields of mass transit, data acquisition and robotics, automotive performance and durability, weapon systems and engine development.

Mr. Partridge has over 30 years’ engineering and business experience and is skilled in the application of scalable cost effective manufacturing methodologies. He spent six years with General Motors Holden’s Limited and joined applied technology company, Innovonics Pty Ltd as joint Managing Director where he was responsible for establishing and developing its mechatronics design and manufacturing capabilities. Mr. Partridge served on its board to a successful public listing. He has been on the Board of Tectonica since 2002.

Steven Poad,

Chief Financial Officer

Steven Poad is a Financial Consultant and a CPA, CA who has over 30 years of mining industry experience with a variety of companies including Volta Resources Inc., which is now a part of B2Gold, and Falconbridge Limited, now part of Xstrata. His international experience includes involvement with operations in Africa, Europe, Asia and South America. Mr. Poad is the former CFO of Volta Resources Inc., Excellon Resources Inc., which has a high grade silver mine in Mexico, Colossus Minerals Inc., and High River Gold Mines Ltd. Mr. Poad holds an Honours Bachelor of Commerce degree from McMaster University and became a chartered accountant in 1976.

Jeremy S. Budd,

Corporate Secretary

Jeremy S. Budd is a lawyer and founder of Budd Law, has been practising corporate and securities law, in Toronto, Ontario, since 2007 representing issuers and underwriters in a wide variety of capital market transactions. Mr. Budd obtained his J.D./M.B.A. from Osgoode Hall, Law School and the Schulich School of Business at York University in 2005 and holds a Bachelor of Arts in philosophy from Huron University College at the University of Western Ontario.

Financing Details

In connection with the Potential Qualifying Transaction, Vector plans to complete a non-brokered private placement (the “Private Placement”) pursuant to which the Issuer plans to issue a minimum of 27,142,857 Pre-Consolidation Vector Subscription Receipts (approximately 4,523,810 Post-Consolidation Vector Subscription Receipts) and up to a maximum of 35,714,286 Pre-Consolidation Vector Subscription Receipts (approximately 5,952,381 Post-Consolidation Vector Subscription Receipts) at a price of approximately US$0.14 (CAD$0.19) per Pre-Consolidation Vector Subscription Receipt (US$0.84 (approximately CAD$1.14) per Post-Consolidation Vector Subscription Receipts) for gross proceeds of a minimum of approximately US$3,800,000 and up to a maximum of approximately US$5,000,000, the net proceeds of which are expected to be used to establish North American and European marketing and business development offices, partially fund research and development of new product verticals and for general working capital purposes. At this time, Vector does not expect that any finder’s fees, broker fees or commissions to be paid in connection with the non-brokered private placement.

Upon receipt of the later to occur of the following: (a) the receipt of conditional approval from the TSXV for the Share Exchange; and (b) the receipt of conditional approval from the TSXV for the listing of the Vector Shares issuable upon deemed exercise of the Subscription Receipts, each Vector Subscription Receipt will, for no additional consideration, automatically be exchanged into one pre-Consolidation Vector Share. If the Final Exchange Bulletin has not been issued four months from the closing date of the Private Placement, the funds shall be returned to the holders of the Subscription Receipts on a pro rata basis.

Trading Halt and Additional Information

Trading in Vector Shares has been halted pending receipt by the TSXV of certain required materials from the Corporation and review of the Proposed Transaction by the Exchange. The Corporation will continue to provide further details in respect of the Transaction in due course by way of press release.

Exchange Rates

On March 15, 2016, the Bank of Canada’s noon spot exchange rate for the purchase of one U.S. dollar using Canadian dollars was 1.3359 (CAD$1.34 = USD$1.00).

On March 15, 2016, the Bank of Canada’s noon spot exchange rate for the purchase of one U.S. dollar using Australian dollars was $1.3398 (AUD$1.34 = USD$1.00).

About Tectonica Australia Pty Ltd.

Tectonica, a privately owned Australian company with operations in West Melbourne, Victoria, Australia, that develops and integrates advanced technology for application in the Defence and Law Enforcement markets. It has a track record of commercialising technology and developing innovative products for use by armoured vehicles, unmanned system and soldiers. Tectonica has developed a range of defence and law enforcement solutions in the areas of land navigation and, power and data management systems.

Tectonica is focused on providing government and defence industry customers with cutting edge technology to meet the capability challenges of the future. Its team of professional engineers has a track record in successfully commercialising technology and completing government contracts complemented by its prototyping and manufacturing capability that deliver its products to global markets

About the Corporation

Vector is a capital pool company. Since its incorporation, other than its initial public offering under the CPC Policy in November 2011 and the transactions in relation thereto, the Corporation has not commenced commercial operations and currently has no assets other than cash and promissory notes receivable, and liabilities.

For more information, please contact:

Darryl Levitt

Vector Resources Inc.

T: (416) 202-6713

E: darryl.levitt@gmail.com

David Levy

Tectonica Australia Pty Ltd.

T: +613 9381 6700

E: david.levy@tectonica.net

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

This Press Release is not for dissemination within the United States.

Forward-looking Statements

Certain statements in this document constitute “forward-looking statements” within the meaning of various security legislation inclusive of but not limited to the United States Private Securities Litigation Reform Act of 1995 and/or “forward-looking information” under the Securities Act (Ontario). These statements include, without limitation, completion a proposed transaction and related financing, regulatory approvals and matters concerning the business, operations, and strategy of Vector and Tectonica. These statements generally can be identified by use of forward-looking word such as “may”, “will”, “would”, “should”, “intends”, “proposes”, “expects”, “anticipates”, “believes”, “plans”, “estimates”, or “continue” or the negative thereof or similar variations. The proposed Transaction and related financing, and the future business, operations and performance of the Resulting Issuer discussed herein could differ materially from those expressed or implied by such statements. Such forward-looking statements are qualified in their entirety by the inherent risks and uncertainties surrounding future expectations, including that the Transaction contemplated herein is completed.

We made a number of assumptions in the preparation of these forward-looking statements which may prove to be incorrect. You should not place undue reliance on our forward-looking statements, which are subject to a multitude of risks and uncertainties that could cause actual results, future circumstances or events to differ materially from those projected in the forward-looking statements. These risks include, but are not limited to, the ability of Vector and Tectonica to obtain board and any necessary shareholder approval to complete a Definitive Agreement, a Business Combination, a proposed Transaction and related financing, or to satisfy the requirements of the Exchange with respect thereto, securing and maintaining corporate alliances, the need for additional capital and the effect of capital market conditions and other factors, including capital availability, the potential dilutive effects of any financing, the timing of programs to explore, develop and commercialize products, the timing and costs of obtaining regulatory approvals, estimates regarding capital requirements and future revenues, the timing and amount of investment tax credits, and other risks detailed from time to time in our public disclosure documents or other filings with the securities commissions or other securities regulatory bodies in Canada and the U.S as well as abroad. Additional risks and uncertainties relating to the Corporation and our business can be found in the “Risk Factors” section of our Prospectus dated September 28, 2011, as well as in our other public filings. The cautionary statements qualify all forward-looking statements attributable to Vector and Tectonica and persons acting on their behalves. Unless otherwise stated, the forward-looking statements are made as of the date hereof, and we disclaim any intention and have no obligation or responsibility, except as required by law, to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Completion of the proposed transaction is subject to a number of conditions, including but not limited to, Exchange acceptance, and if applicable pursuant to Exchange Requirements, majority of the minority shareholder approval. Where applicable, the transaction cannot close until the required shareholder approval is obtained. There can be no assurance that the transaction will be completed as proposed or at all.

Investors are cautioned that, except as disclosed in the management information circular or filing statement to be prepared in connection with the transaction, any information released or received with respect to the transaction may not be accurate or complete and should not be relied upon. Trading in the securities of a capital pool company should be considered highly speculative.

M Partners Inc., subject to completion of satisfactory due diligence, has agreed to act as sponsor in connection with the transaction. An agreement to sponsor should not be construed as any assurance with respect to the merits of the transaction or the likelihood of completion.

The TSX Venture Exchange Inc. has in no way passed upon the merits of the proposed transaction and has neither approved nor disapproved the contents of this press release.

To view this press release as a PDF file, click onto the following link:
public://news_release_pdf/Vector03222016.pdf
Source: Vector Resources Inc. (TSX Venture:VCR.H)

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