Ms. Anne Chopra reports
HARVEST ONE CAPITAL INC. ENTERS INTO DEFINITIVE AGREEMENT WITH MOBILE CORPORATION
Harvest One Capital Inc. has entered into an agreement and plan of merger dated March 9, 2016, with Mobile Corp. to provide for the completion of the acquisition of Mobile. The transaction was initially announced by Harvest in a press release dated Oct. 21, 2015, indicating Harvest and Mobile had entered into a non-binding letter of intent with respect to the transaction.
Upon completion of the transaction, Harvest will become a wholly owned subsidiary of Harvest, and Harvest will change its name to Mobile Holdings Corp. or such other name as the parties may reasonably agree upon. The combined entity (the resulting issuer) will continue the business of Mobile.
The acquisition, once completed, is intended to constitute Harvest's qualifying transaction pursuant to Policy 2.4 of the corporate finance manual of the TSX Venture Exchange. Harvest and Mobile are at arm's length, and accordingly, the transaction is not considered a non-arm's-length transaction.
Pursuant to the definitive agreement, Harvest will acquire all of the issued and outstanding securities of Mobile from its shareholders in exchange for 34,034,370 common shares of Harvest at the closing of the transaction. Holders of Harvest stock options, as well as holders of Mobile's stock options, share purchase warrants, and other vesting or convertible securities, will be entitled, on exercise, to receive common shares of the resulting issuer, subject to adjustment to reflect the completion of the transaction.
Harvest has agreed to consolidate its issued and outstanding share capital on a basis of one new share for two old shares as part of the transaction. After the share consolidation, Harvest will have 2,046,560 common shares issued and outstanding and stock options exercisable for 132,000 common shares.
The parties have agreed to pay a finder's fee to two arm's-length parties in connection with the transaction. The finders' fees will be paid in cash and common shares.
Closing the transaction is subject to several conditions, including, but not limited to:
- Completion of all due diligence reviews;
- Receipt of all regulatory, shareholder, director and other third party approvals as required under applicable laws or regulatory policies;
- Completion of the share consolidation;
- Entry into any regulatory-required escrow agreements by Mobile shareholders;
- Completion of the proposed transaction financing;
- Harvest shall be a reporting issuer in British Columbia and Alberta, not in default;
- No material actions, suits or proceedings at time of closing involving either party;
- No material adverse change to assets, technology, liabilities, business, operations or financial condition at time of closing of either party;
- A new slate of directors be appointed as agreed by the parties.
Concurrent with the transaction, the parties have agreed to raise a minimum of $2-million through the issuance of common shares of Harvest through an offering of shares and warrants on terms to be negotiated with the agent of the private placement.
The parties may pay finders' fees to arm's-length parties for proceeds raised under the transaction financing. These fees may be payable, at the discretion of the parties, in cash or in common shares. The parties expect a portion of the transaction financing will be a brokered financing. The exact terms of the transaction financing will be announced at a later date.
The transaction financing will be used to advance the business of the resulting issuer and for general working capital purposes.
In addition to the transaction financing, Mobile intends to undertake a bridge financing of approximately $250,000 (U.S.). This bridge financing may consist of debt or convertible debt in Mobile.
Sponsorship of business combination
Sponsorship of a qualifying transaction is required by the exchange unless exempt in accordance with exchange policies. Harvest intends to apply for an exemption from the sponsorship requirements. There is no assurance that Harvest will ultimately obtain an exemption from sponsorship.
New board of directors
At the close of the transaction, the management and board of directors of Harvest will resign, and a new board of directors comprising seven nominees of Mobile and one nominee of Harvest will be appointed to the resulting issuer. The board of directors of the resulting issuer is expected to consist of: Jeffrey Peterson, Michael Silberman, Clinton Brown, Cesar Sanvicente, Dennis Burke and Richard Heftel, and Anne Chopra and Lucy Lu.
Reinstatement to trading
Harvest's shares will be halted pending receipt by the exchange of certain required materials from Harvest and until Harvest engages a sponsor or receives a waiver from sponsorship.
Mobile is a private company incorporated in Nevada in March, 2013. Mobile is a prerevenue Internet company. Mobile was founded to enter the global on-line outsourcing industry through the Internet and mobile devices by providing global enterprises, small- to medium-sized businesses, and early-stage companies with a talent-as-a-service (TaaS) solution for part, if not all, of their staffing needs. Conversely, Mobile provides knowledge-based workers and freelancers, and over all, the contingent work force, roughly one-third of the existing global work force, with an on-line community to network, and the ability to brand, find work and transact on-line. Mobile expects to commence generating revenues by the second quarter of 2016. For more information about Mobile, visit the Mobile website.
All information in this news release, regarding Harvest and Mobile, was supplied by the parties, respectively, for inclusion herein. Each party and its directors and officers have relied on the other party for any information concerning the other party.
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.
We seek Safe Harbor.
© 2018 Canjex Publishing Ltd. All rights reserved.