CALGARY, March 8 /CNW/ - Silver Fern Financial Ltd. ("Silver Fern")
(trading symbol "SFL.P" TSXV), an Alberta capital pool company, and Emedia
Networks International Corporation ("Emedia") (trading symbol "EMM" TSXV), a
public British Columbia company engaged in the business of providing licensed
foreground music played in public places, are pleased to announce that they
have entered into a letter of intent (the "LOI") dated February 27, 2007
whereunder the parties have agreed to negotiate a definitive agreement
relating to a proposed merger transaction (the "Transaction") pursuant to
which Silver Fern and Emedia will complete a business combination by way of
amalgamation, arrangement, takeover bid or other form of transaction (the
combined entity hereinafter referred to as the "Resulting Issuer"). The arm's
length Transaction will constitute Silver Fern's "Qualifying Transaction"
under the applicable policies of the TSX Venture Exchange (the "TSXV").
Pursuant to the Transaction holders of all of the issued and outstanding
common shares of Emedia (the "Emedia Shares") will receive common shares of
the Resulting Issuer ("Resulting Issuer Shares") on the basis of one Resulting
Issuer Share for each Emedia Share held. Holders of all of the issued and
outstanding common shares of Silver Fern ("Silver Fern Shares") will receive
Resulting Issuer Shares on the basis of one Resulting Issuer Share for each
Silver Fern Share held. All convertible securities of Emedia and Silver Fern
shall, pursuant to the Transaction, be exchanged for equivalent securities of
the Resulting Issuer with the appropriate adjustment to their respective
exercise prices; however, all options to acquire Emedia Shares currently
outstanding with an exercise price of $0.10 per Emedia Share will be exchanged
on a one for one basis for options to purchase Resulting Issuer Shares with an
exercise price of $0.25 per Resulting Issuer Share.
Concurrently with completion of the Transaction, the Resulting Issuer
will acquire 25% of the issued and outstanding voting securities of Stripe
Mobile Inc. ("Stripe"), a private Alberta corporation engaged in the mobile
music industry, from current shareholders of Stripe in exchange for the
issuance of 2,500,000 Resulting Issuer Shares to such shareholders. Further,
the Resulting Issuer will be granted, by current shareholders of Stripe, a six
month option to acquire additional voting securities of Stripe equal to 40% of
the issued and outstanding voting securities of Stripe in exchange for issuing
5,000,000 Resulting Issuer Shares to shareholders of Stripe. Due to the
Transaction, the private placement of 3,000,000 units of Emedia to Stripe
announced by Emedia on December 1, 2006 will not proceed.
A deposit of $125,000 is to be paid by Silver Fern to Emedia pursuant to
the LOI, $100,000 of that deposit is refundable and will be secured by a
general security agreement. The payment of this deposit is subject to TSXV
The Transaction is subject to shareholder approval of Silver Fern.
Upon completion of the Transaction, it is anticipated that the Resulting
Issuer will grant an aggregate of 2,100,000 stock options to purchase
Resulting Issuer Shares, having an exercise price of $0.25 per share to
directors and officers of the Resulting Issuer.
If the Transaction is completed, the Resulting Issuer will have
21,566,895 Resulting Issuer Shares issued and outstanding (on a non-diluted
Emedia is a British Columbia incorporated company, listed on the TSXV,
and is in the business of supplying licensed foreground music played in public
spaces. EMedia's client base includes many national Canadian retail chains
including Le Chateau, Body Shop and International Clothiers. Foreground music
consists of CD quality artist recordings that are played in retail and
restaurant establishments to enhance and define a client's brand image and as
a sales enhancement tool. EMedia delivers fully custom-tailored music
programming through its proprietary "EMplayer" platform. EMedia has recently
launched an aggressive marketing program targeting major US & Canadian retail
chains. Emedia has annual recurring revenue of 1.2 million dollars and
13,066,895 common shares currently issued and outstanding. Further information
regarding Emedia is available on www.sedar.com.
The Resulting Issuer will carry on the business of Emedia upon completion
of the Transaction and will be a 25% holder of Stripe.
Financial Information Concerning Emedia
The following information is derived from Emedia's audited annual
financial statements as at and for the twelve month period ended March 31,
2006 and its management-prepared unaudited interim financial statements for
the three-month period ended September 30, 2006. Such information is qualified
in its entirety by the related notes and other information contained in the
relevant financial statements, which are available at www.sedar.com:
12 Month 3 Month
Period Ended Period Ended
March 31, September 30,
Revenues 1,226,612 321,979
Operating Expenses 1,411,209 327,512
Net Loss for the Period (199,650) (5,533)
Loss per Share (basic and diluted) (0.02) -
Total Assets 768,844 713,355
Total Liabilities 556,296 519,812
Share Capital 1,478,549 1,478,549
Deficit (1,310,604) (1,329,609)
The board of directors of Emedia currently consists of Darren Reiter,
Jasvir Athwal, Daniel Fraser and Gilbert Murray. Each of the current directors
of Emedia will be on the board of the Resulting Issuer following the
Transaction and Mr. David Mears and Mr. Gordon Anderson will be appointed to
the Resulting Issuer's board of directors upon completion of the Transaction.
The municipalities of residence and biographies of the Resulting Issuer's
proposed directors and key officers are as follows:
Darren Reiter - Chief Executive Officer, Secretary and Director
(Vancouver, British Columbia)
Mr. Reiter was appointed Chief Executive Officer of Emedia in September
2003 and prior thereto was Vice-President, Operations and a Director of Emedia
since August 2000. Mr. Reiter obtained a Bachelor of Arts degree from the
University of British Columbia in 1993, a Masters degree in English Literature
from the University of Edinburgh in 1995 and a Certificate in Journalism from
Langara College in 1998.
Jasvir Athwal - President, Chief Financial Officer and Chairman of Board
(Vancouver, British Columbia)
Mr. Athwal was a founder of Emedia and has been a principal of Emedia
since October 1991, President and Director since September 2000 and Chief
Financial Officer since September 2003. Mr. Athwal graduated from the
University of British Columbia's faculty of Pharmaceutical Sciences in 1988
(BSc. Pharm.) and practiced pharmacy for 5 years in British Columbia.
Daniel Fraser, Vice-President, Technology and Director
Mr Fraser is currently Senior Engineer at Reinkus-Heinz Inc., a leading
professional speaker and amplifier manufacturing company and Mr. Fraser has
been Vice-President, Technology and a Director of Emedia since September 2000.
From 1991 to 2000, Mr. Fraser was manager of the computer hardware maintenance
department for the Surrey School District in British Columbia
Gilbert Murray, Director (Vancouver, British Columbia)
Mr. Murray has been a Director of Emedia Networks since October 2001. He
is the founder and former sole owner of Black Knight Sales, one of North
America's leading importers of sporting goods.
David Mears, Proposed Director (Calgary, Alberta)
Mr. Mears is the Chief Executive Officer of BrazAlta Resources Corp. Mr.
Mears has over a decade of capital markets experience with a number of
securities firms in Calgary. Mr. Mears was past President of Semper Energy
which merged with Val Vista Energy and remained as a director until its sale
to Avenir Income Trust. Chairman of Sierra Vista Energy Ltd. and also serves
as a director and officer on a number of other TSXV listed companies.
Gordon Anderson, Proposed Director (Calgary, Alberta)
Mr. Anderson holds a Bachelor of Education degree from the University of
Regina (1975). Mr. Anderson has been employed with London Life in a variety of
management positions since 1975. He presently owns an estate-planning firm,
Anderson & Associates Financial Corp., which is associated with London Life.
Mr. Anderson is also President of Freestyle Holdings Corp. and affiliated
private companies involved in real estate development and other investments.
Since 1995 to the present, Mr. Anderson has also served as a director and
officer of a number of publicly traded companies.
Stripe, based in Calgary, Alberta, provides mobile content service across
North America. Stripe sells ringtones, wallpapers and is the premier provider
of "phony messages" to consumers through its mobile storefront
www.stripemobile.com. Stripe is connected to major U.S. carriers which
connection provides Stripe with access to nearly 200 million mobile
subscribers. Under the tag line "What's your Stripe?" Stripe promotes and
develops a wide range of new mobile personalization services.
The proposed qualifying transaction is subject to a number of conditions
including the following:
(a) approval by the board of directors and shareholders of both Silver
Fern and Emedia;
(b) satisfactory due diligence by both Silver Fern and Emedia;
(c) repayment of short term loans and equipment debt by Emedia of up to
(d) completion of the purchase of 25% interest in Stripe by the Resulting
(e) negotiation and execution of a definitive agreement;
(f) satisfactory termination by Emedia of a financial advisory agreement;
(g) regulatory approvals.
It is anticipated that trading of the common shares of both Emedia and
Silver Fern will re-commence on Monday, March 12, 2007.
Completion of the 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
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.
This new release shall not constitute an offer to sell or the
solicitation of an offer to buy any securities in any jurisdiction.
For further information:
For further information: contact Darren Reiter, Chief Executive Officer
and Director of Emedia at (604) 742-3344; or Gordon Anderson, Chief Executive
Officer of Silver Fern at (403) 265-3733