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TORONTO, July 13, 2018 /CNW/ - Revelstoke Equity Inc. (TSXV: REQ.H) (the "Corporation" or "Revelstoke") announces that, further to its press release dated July 12, 2018 (the "Previous Press Release"), Zonetail Inc. ("Zonetail") has closed its previously announced brokered private placement of 11,130,092 subscription receipts of Zonetail ("Subscription Receipts") for gross proceeds of $2,003,416.56 (the "Private Placement") pursuant to an Agency Agreement dated July 13, 2018 (the "Agency Agreement") among the Corporation, Zonetail, Gravitas Securities Inc. ("Gravitas"), acting as co-lead agent with Canaccord Genuity Corp. for the Private Placement, and with Beacon Securities Limited (collectively, the "Agents"). In connection with their services to Zonetail with respect to the Private Placement, the Agents have been compensated pursuant to the Agency Agreement as was previously disclosed in the Previous Press Release.
The Private Placement was completed as a condition to the Corporation's "Qualifying Transaction" (as such term is defined in the policies of the TSX Venture Exchange) pursuant to which the Corporation and Zonetail are expected to combine their business operations (the "Transaction"). Upon completion of the Qualifying Transaction, the combined entity (the "Resulting Issuer") will continue to carry on the business of Zonetail. For further details on the Transaction, please see the Previous Press Release.
Each Subscription Receipt will be automatically exchanged immediately prior to the completion of the Transaction (without any further action by the holder of such Subscription Receipt and for no further payment) for common shares of Zonetail ("Zonetail Shares"), each of which shall be exchangeable into one common share of the Resulting Issuer, upon satisfaction of certain escrow release conditions (the "Escrow Release Conditions"). The proceeds from the Private Placement less $100,000.08 pursuant to a subscription settling directly with Zonetail ("Escrowed Funds") have been deposited in escrow pursuant to a subscription receipt agreement dated July 13, 2018 (the "Subscription Receipt Agreement") between Zonetail, Gravitas and TSX Trust Company, as registrar and transfer agent for the Subscription Receipts and as escrow agent to receive the Escrowed Funds. If the Escrow Release Conditions are not satisfied, the Escrowed Funds will be returned to the subscribers of the Private Placement in accordance with the Subscription Receipt Agreement. The proceeds from the Private Placement, once released from escrow, will be used for the initial development of Zonetail's blockchain application technology, sales and marketing efforts, and general working capital and corporate purposes.
For further information concerning the Transaction, please refer to the press release of the Corporation dated January 31, 2018 and the Previous Press Release available on SEDAR at www.sedar.com. Completion of the Transaction is subject to a number of conditions including, but not limited to, closing conditions customary to transactions of the nature of the Transaction, approvals of all regulatory bodies having jurisdiction in connection with the Transaction, TSX Venture Exchange acceptance of the Transaction as the Qualifying Transaction of Revelstoke and, if required by the TSX Venture Exchange policies, majority of the minority shareholder approval. Where applicable, the Transaction cannot close until the required shareholder approvals are obtained and 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 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.
This news release contains "forward-looking information" within the meaning of applicable securities laws relating to the proposal to complete the Transaction and associated transactions, including statements regarding the terms and conditions of the Transaction, the release of the Escrowed Funds and the use of proceeds of the Private Placement. The information about Zonetail contained in the press release has not been independently verified by the Corporation. Although the Corporation believes in light of the experience of its officers and directors, current conditions and expected future developments and other factors that have been considered appropriate that the expectations reflected in this forward-looking information are reasonable, undue reliance should not be placed on them because the Corporation can give no assurance that they will prove to be correct. Readers are cautioned to not place undue reliance on forward-looking information. Actual results and developments may differ materially from those contemplated by these statements depending on, among other things, the risks that the parties will not proceed with the Transaction, the release of the Escrowed Funds and associated transactions, that the ultimate terms of the Transaction and associated transactions will differ from those that currently are contemplated, and that the Transaction, the release of the Escrowed Funds and associated transactions will not be successfully completed for any reason (including the failure to obtain the required approvals or clearances from regulatory authorities). The terms and conditions of the Transaction may change based on the Corporation's due diligence (which is going to be limited as the Corporation intends largely to rely on the due diligence of other parties of the Transaction to contain its costs, among other things) and the receipt of tax, corporate and securities law advice for both Revelstoke and Zonetail. The statements in this press release are made as of the date of this release. The Corporation undertakes no obligation to comment on analyses, expectations or statements made by third-parties in respect of the Corporation, Zonetail, their securities, or their respective financial or operating results (as applicable).
Neither the TSX Venture Exchange, Inc. nor its Regulation Services Provider (as that term is defined in the polices of the TSX Venture Exchange) has in any way passed upon the merits of the Transaction and associated transactions and neither of the foregoing entities has in any way approved or disapproved of the contents of this press release.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
The common shares have not been and will not be registered under the United States Securities Act of 1933, as amended and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirement. This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any jurisdiction in which such offer, solicitation or sale would be unlawful.
SOURCE Revelstoke Equity Inc.
For further information: Revelstoke Equity Inc.: Craig Leon, Chief Executive Officer, Chief Financial Officer, Corporate Secretary and Director, Telephone: (416) 368-2773, Email: [email protected]