Software Growth Inc. announces proposed qualifying transaction with Textronics Inc.



    /NOT FOR DISTRIBUTION TO THE UNITED STATES NEWSWIRE SERVICES
    OR FOR DISSEMINATION IN THE UNITED STATES/

    TORONTO, Feb. 11 /CNW/ - SOFTWARE GROWTH INC. (TSXV: SGW.P) (the
"Corporation"), a Capital Pool Company, announced today that it has entered
into a term sheet that serves as an agreement in principle concerning a
proposed transaction (the "Transaction") between the Corporation and
Textronics Inc. ("Textronics") which, if completed, will be the Corporation's
qualifying transaction pursuant to the policies of the TSX Venture Exchange
Inc. (the "Exchange").

    Textronics Inc.

    Textronics is a private corporation incorporated under the laws of the
State of Delaware, with its head office in Wilmington, DE.
    Textronics is a leader in the development of wearable sensors for fitness
and health monitoring. The company's patented textile sensor systems are
capable of capturing comprehensive physiologic data from the body, such as
heart rate, ECG and respiration, and are designed to be seamlessly integrated
into everyday garments. Wearable monitoring allows a comfortable and user
friendly way to obtain body data measurements to assist consumers in managing
their top wellness concerns of weight loss, improved physical health and
fitness training.
    Textronics markets its own line of clothes and electronics for personal
monitoring under the brand name NuMetrex(R). NuMetrex(R) apparel is part of a
system that includes a small transmitter and heart monitor watch or fitness
machine. The transmitter snaps into the garment sensor electrodes, eliminating
the need for an uncomfortable chest strap. The NuMetrex transmitter is
compatible with most brands of heart rate monitor watches and gym-quality
cardio equipment. The apparel line includes a women's sports bra, racer tank
top, men's cardio shirt and textile strap, all with integrated textile
electrodes that sense the wearers heart rate.
    Textronics consumer products are currently sold online via
www.NuMetrex.com, and through retail partners such as lululemon athletica
(NASDAQ:  LULU), Reebok, online ordering for Dicks Sporting Goods, The Sports
Authority and Modell's, as well as numerous catalogues and speciality sports
retail stores.
    In professional health markets, Textronics works with strategic partners
by providing textile sensors that are sold as components or finished garments.
Professional health applications include team sports, military, first
responders and medical systems.
    Textronics has a patent portfolio of 16 applications, of which three have
been granted and thirteen are pending. Textronics is a spin-out of INVISTA
S.a.r.l., formerly DuPont Textiles and Interiors.
    More information can be seen on Textronics' website:
www.textronicsinc.com.

    Transaction Summary

    The Transaction will consist of a number of steps including the
following:
    
    (a) The Corporation will incorporate a wholly-owned subsidiary
        ("Newco") under the laws of Delaware.

    (b) The Corporation, Textronics and Newco will engage in a "three
        cornered" merger whereby Textronics and Newco will merge to form a
        new company which will be wholly-owned by the Corporation. The
        holders of common shares, preferred shares, options and warrants of
        Textronics will exchange all such rights for shares, options and
        warrants in the capital of the Corporation.

    (c) Textronics will conduct a private placement in an amount of between
        $5,000,000 and $8,000,000, with an option to increase the size of the
        offering by $2,000,000 (the "Private Placement"). Textronics proposes
        to appoint an agent on a best-efforts basis in connection with the
        Private Placement.

    (d) The Corporation will, on closing of the Transaction, increase its
        board of directors to five and change its trading symbol subject to
        Exchange approval.

    (e) The Corporation will, on or subsequent to closing of the Transaction,
        and subject to shareholder approval, consolidate its shares, change
        its name, and restate its option plan.
    

    The Transaction is an arm's length transaction. No related party of the
Corporation has any interest in Textronics. Accordingly, the Transaction will
not, as currently contemplated, be subject to approval by the shareholders of
the Corporation.

    Share Capital (all stated on an unconsolidated basis)

    The common shares in the capital of the Corporation for the purposes of
the Transaction for buying Textronics have been valued at $0.385 per share.
The deemed fully diluted purchase price for Textronics is $9,000,000, not
including the Private Placement.
    The Private Placement will consist of 20,000,000 units at $0.40 per unit
(based on an $8,000,000 financing). Each unit is comprised of one common share
and one half of one share purchase warrant. Each whole share purchase warrant
will entitle the holder to acquire one share at a price of $0.60 for a period
of eighteen months from the Transaction.
    Assuming $5,000,000 is raised by way of the Private Placement, there will
be an estimated 46,789,121 shares outstanding and assuming $8,000,000 is
raised by way of the Private Placement, there will be an estimated 58,601,623
shares outstanding in the capital of the Corporation, in each case, on a fully
diluted basis.

    Conditions

    Completion of the Transaction is subject to a number of conditions,
including but not limited to, completion of the Private Placement, negotiation
and signing of a definitive agreement, and Exchange acceptance. Shareholder
approval of the share consolidation and name change is not a requirement for
the Transaction to close. The Transaction cannot close until all the
conditions are satisfied. There can be no assurance that the transaction will
be completed as proposed or at all.
    A comprehensive press release with further particulars of the Transaction
will follow in accordance with the policies of the Exchange. Trading in the
common shares of the Corporation will remain halted pending the release of
more fulsome disclosure regarding the Transaction and the satisfaction of the
filing requirements of the Exchange.

    Completion of the transaction is subject to a number of conditions,
including but not limited to, Exchange acceptance. 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 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.

    Certain information in this press release may contain forward-looking
statements. 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.

    This is not an offer for sale, or a solicitation of an offer to buy, in
the United States or to any "U.S. Person," as such term is defined in
Regulation S under the U.S. Securities Act of 1933, as amended (the "U.S. 1933
Act") of any equity shares or any other securities of Software Growth, or
Textronics. The common shares of Software Growth to be issued in the Proposed
Transaction to the stockholders of Textronics have not been registered under
the U.S. 1933 Act and may not be offered or sold in the United States (or to a
U.S. person) absent registration under the U.S. 1933 Act or an applicable
exemption from the registration requirements of the U.S. 1933 Act.

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

    %SEDAR: 00023895E




For further information:

For further information: Mark Lawrence, President, Software Growth Inc.,
(416) 707-6630 or mark@northcrestpartners.com; Stacey Burr, President,
Textronics Inc., (302) 351-2155 or sburr@textronicsinc.com

Organization Profile

SOFTWARE GROWTH INC.

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