TSX Venture Exchange Symbol: ETE.P
TORONTO, July 17, 2012 /CNW/ - Chrysalis Capital VIII Corporation ("Chrysalis VIII" or the "Corporation") is pleased to announce that it has entered into a definitive
acquisition agreement (the "Acquisition Agreement") with each of Fresco Microchip Inc. ("Fresco") and RedMere Technology Limited ("RedMere") and their respective principal shareholders for the creation of a new
semiconductor company to be named Spectra7 Microsystems Inc. ("Spectra7).
About Spectra7 Microsystems Inc.
Spectra7 is being formed to address the exponential demand for bandwidth
which is being driven by rich media, higher resolution displays and the
rapid adoption of smartphones and tablets. Consumer electronics and
internet infrastructure original equipment manufacturers ("OEMs") can
only achieve their performance and cost objectives with new, high
performance, low power analog "signal conditioning" semiconductor
devices. Using intellectual property developed by RedMere and Fresco
over the past seven years, Spectra7 will be in a position to provide
new system level analog components that will deliver unprecedented
bandwidth over fiber, copper and wireless links designed to address the
bandwidth bottlenecks in today's and tomorrow's mobile internet.
Today, RedMere is the leader in "active" HDMI connectivity solutions and
has products in production with leading cable OEMs available at retail
electronics stores around the world. Fresco is a leader in low cost,
high performance silicon tuner solutions required by television OEMs
worldwide. The combination of both companies will result in a capital
investment to date of over $80 million, a significant portfolio of
patents and development centers in four countries.
"The mobile internet has an insatiable appetite for bandwidth - growing
almost twentyfold in the next four years, with connection speeds
increasing tenfold during the same time," commented Tony Stelliga,
RedMere's newly appointed CEO. "As a result, smartphones, tablets and
the wireless infrastructure are being redesigned with new analog signal
processing technology. This is an unprecedented opportunity for new
semiconductor technologies and the unique combination of RedMere's
analog products, Fresco's wireless technologies and new capital allows
Spectra7 to immediately capitalize on this opportunity and solidify its
Mr. Stelliga will become CEO of Specra7 upon the closing of the Proposed
Transaction, as defined below. Mr. Stelliga is currently the CEO of
RedMere and sits on the board of directors of both Fresco and RedMere.
The Proposed Transaction
Under the terms of the Acquisition Agreement, Chrysalis VIII will
acquire all of the issued and outstanding shares in the capital of
Fresco (the "Fresco Shares"), a corporation incorporated under the Business Corporations Act (Ontario), and all of the issued and outstanding shares in the capital
of RedMere (the "RedMere Shares"), a corporation incorporated under the Companies Act (Ireland) (together, the "Spectra7 Shares"). The Proposed Transaction will be structured in a manner to
accommodate efficiencies for various legal structures, tax and
accounting treatments and securities regulations. Upon completion of
the Proposed Transaction, Chrysalis VIII will be the "resulting
issuer", with each of Fresco and RedMere becoming a wholly-owned direct
or indirect subsidiary of Chrysalis VIII.
The Acquisition Agreement creates binding and enforceable obligations on
(i) Chrysalis VIII; (ii) Fresco; (iii) RedMere; and (iv) each of Celtic
House Venture Partners Fund III L.P., Celtic House Venture Partners
Fund (Barbados) SRL, and Celtic House Venture Partners Fund III (U.S.)
L.P. (collectively, "Celtic House") and Ventures West 8 Limited Partnership ("VW8"). Upon completion of the Proposed Transaction, it is anticipated that
Celtic House will own approximately 50% of the outstanding Spectra7
Shares and VW8 will own approximately 20% of the outstanding Spectra7
Although the Proposed Transaction will result in RedMere and Fresco
becoming wholly-owned direct or indirect subsidiaries of Chrysalis
VIII, the Proposed Transaction will constitute a reverse take-over of
Chrysalis VIII inasmuch as the former shareholders of RedMere and
Fresco will own a substantial majority of the outstanding common shares
in the capital of Chrysalis VIII (the "Common Shares"). Upon completion, the Proposed Transaction will constitute the
"Qualifying Transaction" of Chrysalis VIII pursuant to the policies of
the TSX Venture Exchange (the "TSX-V").
A comprehensive press release with further particulars relating to the
Proposed Transaction will follow in accordance with the policies of the
Definitive Agreement Financing
Fresco and/or RedMere have agreed to complete a convertible debt
financing within 21 days after the signing of the Acquisition
Agreement, resulting in aggregate gross proceeds of not less than
$4,000,000 (the "Definitive Agreement Financing"). Without requiring any further consent of the holders thereof, all of
the convertible securities issued pursuant to the Definitive Agreement
Financing will be automatically: (a) exchanged into Common Shares on an
as if converted basis concurrent with the closing of the Proposed
Transaction; or (b) converted or exchanged into Fresco Shares or
RedMere Shares, as applicable, immediately prior to the closing of the
Proposed Transaction, and then such Fresco or RedMere Shares will be
exchanged for Common Shares concurrent with the closing of the Proposed
Transaction. It is anticipated that the Definitive Agreement Financing
will be subscribed to by a group of Fresco and/or RedMere's existing
Qualifying Transaction Financing
Prior to or concurrently with the closing of the Proposed Transaction,
Fresco and/or RedMere intend to complete an additional convertible debt
financing resulting in aggregate gross process of not less than
$6,000,000 (the "Qualifying Transaction Financing"). Without requiring any further consent of the holders thereof, all of
the convertible securities issued pursuant to the Qualifying
Transaction Financing will be automatically: (a) exchanged into Common
Shares on an as if converted basis concurrent with the closing of the
Proposed Transaction; or (b) converted or exchanged into Fresco Shares
or RedMere Shares, as applicable, immediately prior to the closing of
the Proposed Transaction, and then such Fresco and/or RedMere Shares
will be exchanged for Common Shares concurrent with the closing of the
Proposed Transaction. One or more agents may be engaged to assist in
raising the Qualifying Transaction Financing.
ABOUT CHRYSALIS CAPITAL VIII CORPORATION
Chrysalis Capital VIII Corporation is The Chrysalis Capital Group Inc.'s
("TCCG") eighth capital pool company ("CPC"). TCCG is entirely focused on generating superior shareholder returns
through the creation of a series of unique CPCs. To date, TCCG has
created eight Chrysalis branded CPCs and has assisted in the creation
of four additional CPCs under TCCG's partners program. For more
information about TCCG, please visit www.tccg.ca.
ABOUT FRESCO MICROCHIP INC.
Fresco is a leader in RF, analog and digital semiconductors. The
company's products deliver Value Through Innovation™ by offering
significantly lower system solution costs at optimal performance.
Fresco's patent-pending technology transcends a broad range of consumer
devices creating a fundamental paradigm shift in the television market.
Fresco's customers include top tier tuner manufacturers who supply
leading consumer electronic brands.
Fresco is currently a private company with lead investors Celtic House
and VW8. The company is headquartered in Toronto, Canada with design
centers both in head office and Irvine, California.
ABOUT REDMERE TECHNOLOGY LIMITED
RedMere provides complete active-cable solutions to cable industry
leaders and manufacturing partners. In a world where connection speed
increases, RedMere enables easy to use, high quality, smart
connectivity for The Home, On the Move and The Office.
These new active cable systems deliver the ultimate in compact digital
connectivity over HDMI, DisplayPort and USB for Video and Still
Cameras, Smartphones, HDTV, Blu-Ray DVD, PS3 and Xbox, as well as
enterprise solutions using Infiniband and PCI Express.
RedMere is currently a private company with lead investors Celtic House
Venture Partners and EdgeStone Capital Partners. The Company is
headquartered in Cork, Ireland.
Completion of the Proposed Transaction is subject to a number of
conditions, including but not limited to, TSX-V acceptance. There can
be no assurance that the transaction will be completed as proposed or
Investors are cautioned that, except as disclosed in the filing
statement to be prepared in connection with the Proposed Transaction,
any information released or received with respect to the proposed
transaction may not be accurate or complete and should not be relied
upon. Trading in the securities of a CPC should be considered highly
The TSX-V has in no way passed upon the merits of the Proposed
Transaction and has neither approved nor disapproved the contents of
this press release. Neither the TSX-V nor its Regulation Services
Provider (as that term is defined in the policies of the TSX-V) accepts
responsibility for the adequacy or accuracy of this release.
Certain information in this press release may constitute forward-looking
information. This information is based on current expectations that
are subject to significant risks and uncertainties that are difficult
to predict. Actual results might differ materially from results
suggested in any forward-looking statements. The Corporation assumes no
obligation to update the forward-looking statements, or to update the
reasons why actual results could differ from those reflected in the
forward looking-statements unless and until required by securities laws
applicable to the Corporation. Additional information identifying
risks and uncertainties is contained in the Corporation's filings with
the Canadian securities regulators, which filings are available at www.sedar.com.
SOURCE Chrysalis Capital VIII Corporation
For further information:
Chrysalis Capital VIII Corporation
Robert Munro, CEO / CFO
t: (877) 272-4073
t : (650) 670-7055