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MONTREAL, Jan. 4, 2024
/CNW/ - Bold Capital Enterprises Ltd. ("Bold")
(TSXV: BOLD.P) is pleased to announce details concerning its
proposed arm's-length acquisition (the "Transaction") of
Stardust Solar Holdings Inc. ("Stardust"), a corporation
formed under the laws of British
Columbia.
Overview of Bold
Bold is a "capital pool company" under the policies of the TSX
Venture Exchange (the "Exchange") and it is intended that
the Transaction will constitute the "Qualifying Transaction" of
Bold, as such term is defined in Exchange Policy 2.4 – Capital Pool
Companies. The common shares of Bold are currently listed on the
Exchange and Bold is a reporting issuer in the provinces of
British Columbia, Alberta, Ontario and Québec. Bold was incorporated
under the Canadian Business Corporations Act on May 16, 2018.
Overview of Stardust
Stardust is a privately-held British
Columbia based company that is a franchisor of renewable
energy installation services, including solar panels (PV), energy
storage systems, and electric vehicle supply equipment. Stardust
lends its brand and business management services to entrepreneurs
looking to enter the industry of renewable energies. Stardust
franchisees install and maintain clean energy systems for
residential and commercial purposes. As a franchisor, Stardust
supplies its franchisees with the following products: solar PV
equipment, energy storage equipment, and electric vehicle supply
equipment. As well, Stardust supports its franchisees with many
services from corporate headquarters including marketing, sales,
engineering, plan sets, customer service, and project
management. A revenuing generating business, selected
financial information regarding Stardust will be provided in a
subsequent press release, which is expected to be filed
concurrently with the draft Exchange filing statement.
Transaction
It is intended that Stardust and 14204344 Canada Inc., a
wholly-owned subsidiary of Bold, will amalgamate and form one
company under the provisions of the Business Corporations
Act (British Columbia) (the
"BCBCA"). In this regard, the parties have entered
into an amalgamation agreement dated December 27, 2023 (the "Definitive
Agreement") to give effect to the proposed Transaction whereby
Bold, to be renamed "Stardust Solar Energy Inc." (the
"Resulting Issuer"), will hold all of the issued and
outstanding shares in the share capital of Stardust.
Pursuant to the Transaction, Bold will, among other things,
consolidate its issued and outstanding common shares on the basis
of 2.4876 common shares Bold for one common share of the Resulting
Issuer (each a "Resulting Issuer Share"), and issue an
aggregate of 51,304,0012 Resulting Issuer Shares to the Stardust
shareholders, at a deemed issue price of $0.30 per Resulting Issuer Share, valuing
Stardust at $15.4 million. Upon
completion of the Transaction, the shareholders of Stardust are
expected to hold 51,304,012 Resulting Issuer Shares, representing
73% of the 70,304,012 issued and outstanding Resulting Issuer
Shares on a non-diluted basis, and the current shareholders of Bold
are expected to hold 19,000,000 Resulting Issuer Shares,
representing 27% of the 70,304,012 issued and outstanding Resulting
Issuer Shares on a non-diluted basis.
In addition, the Resulting Issuer is expected to have the
following convertible securities issued and outstanding upon
completion of the of Transaction: (i) 25,600 warrants to purchase
25,600 Resulting Issuer Shares, at a price of $0.25 per Resulting Issuer Share; (ii) 3,539,474
RSUs exchangeable for an aggregate of 3,539,474 Resulting
Issuer Shares; and (iii) 625,155 options to purchase up to an
aggregate of 625,155 Resulting Issuer Shares (125,155
post-consolidation Bold options at $0.24876 until April
2024 and 500,000 Resulting Issuer options at $0.40 for a period of three years following the
closing of the proposed Transaction), such that the fully diluted
number of Resulting Issuers is expected to be 74,494,241.
Certain of the Resulting Issuer Shares issued to the principals
of Stardust who will become directors and management of the
Resulting Issuer, will be subject to escrow in accordance with the
policies of the TSX Venture Exchange (the "Exchange").
To the knowledge of the directors and executive officers of
Bold and Stardust, the only persons who currently beneficially own,
directly or indirectly, or exercise control or direction over more
than 10% of the issued and outstanding Stardust shares are
(i) Mr. Mark Tadros, CEO and
founder of Stardust, and (ii) Victory Square Technologies Inc., a
technology accelerator listed on the CSE. Assuming completion
of the Transaction, it is expected that Mr. Tadros will hold
16,039,613 Resulting Issuer Shares, representing approximately
22.8% of the issued and outstanding Resulting Issuer Shares, and
Victory Square Technologies Inc. will hold 5,486,440 Resulting
Issuer Shares, representing approximately 7.8% of the issued and
outstanding Resulting Issuer Shares.
Bold shareholder approval is not required with respect to the
proposed Transaction because the Transaction does not constitute a
"Non-Arm's Length Qualifying Transaction" pursuant to the policies
of the Exchange. Nonetheless, shareholders of Bold will be
asked to vote on certain matters that are accessory to the
Transaction as described below under the heading "Annual and
Special Meeting of Bold Shareholders".
Completion of the Transaction will be subject to certain
conditions, including but not limited to: (a) completion of
due diligence by the parties; (b) receipt of all necessary
shareholder approvals of Stardust and Bold; (c) receipt of all
required regulatory and third party approvals; (d) approval of the
Transaction by the Exchange as Bold's "Qualifying Transaction"; and
(e) closing of the Transaction on or before June 30, 2024, unless
extended in writing by Bold and Stardust.
The parties have not contemplated any concurrent financing as it
is currently expected that the Resulting Issuer will have
sufficient working capital resources to meet its business
objectives following the closing of the Transaction. In
addition, Bold has not paid any deposit, advance or loan to
Stardust in connection with the signature of the Definitive
Agreement, and there are no finder or broker fees payable under the
Transaction.
Trading in the Bold Common Shares has been halted and is not
expected to resume until the Transaction is completed or until the
Exchange receives the requisite documentation to resume
trading.
It is expected that upon completion of the Transaction, the
Resulting Issuer will be listed as a Tier 2 Technology Issuer on
the Exchange.
Proposed Management and Directors
of the Resulting Issuer
It is the intention of Bold and Stardust to establish and
maintain a board of directors of the Resulting Issuer with a
combination of appropriate skill sets that is compliance with all
regulatory and corporate governance requirements, including any
applicable independence requirements. Upon completion of the
Transaction, the board of the Resulting Issuer is expected to be
comprised of five individuals. The following are brief descriptions
of the proposed initial management and directors of the Resulting
Issuer. A fifth independent director of the Resulting Issuer
will be confirmed prior to the closing of the Transaction, with any
such additional director nomination subject to the approval of the
Exchange.
Mark Tadros, CEO and
Director
Mark Tadros is an entrepreneur
who studied Political Science at University of Concordia and earned
a DEC in Economics from John Abbott
College. At 29 years old he founded PDL (Pro Draft League)
and became a pioneer in the world of fantasy sports, creating a
virtual stock market of professional athletes. By 2015 he had
scaled that company to be a globally recognized brand which was
acquired by Victory Square. Eager to return to the entrepreneurial
endeavour he launched iHazmat Regulatory in 2016, a dangerous goods
transport education company with over 200+ corporate clients
worldwide. Mark sold iHazmat to ICC Compliance Center in
June 2021, for the purpose of
allowing him to focus all his attention on Stardust Solar.
In 2017, he founded Stardust Solar Technologies Inc. a solar energy
franchise business. Stardust Solar now has a network of over 2500+
trained/certified individuals and franchisees across North America. Mark learned about business by
running his own, and now believes that anyone with the right vision
and commitment can do the same. Through franchising, he plans to
give thousands of aspiring entrepreneurs the chance to live their
dreams of business ownership in the renewable energy sector.
Eamonn McHugh, COO and
Director
Eamonn began practice in the electrical industry in 2009. He was
certified as a Red Seal Electrician with the Ontario College of Trades in 2015, a PLC
Programming Technician with George Brown
College later in 2015, an Instrumentation & Controls
Technician with the Ontario
College of Trades in 2016, a Master Electrician with Technical
Safety British Columbia in 2017, a Solar Photovoltaic Systems
Electrician with Canadian Standards Association in 2018, and a
Photovoltaic Associate with the North American Board of Certified
Energy Practitioners in 2019.
Eamonn joined Mark Tadros and
Evan Kraemer at Stardust Solar
Technologies with an in-depth understanding of the renewable energy
industry in 2019. As Chief Operating Officer, Eamonn is responsible
for developing and driving operations across all departments,
ensuring company objectives are achieved effectively, and
maintaining continual customer and stakeholder satisfaction.
Young Bann, Director
Mr. Bann is CEO of Purpose ESG Holdings in Vancouver. Mr. Bann has 30 years of management
and business development experience. In the first 15 years, Mr.
Bann developed a career in global management consulting firms, such
as Booz.Allen & Hamilton, Accenture, and IBM. Mr. Bann was
appointed as a lead consultant for Samsung Electronics Mobile Phone
Business Division to contribute it to become global #1 brand in
competitive global markets. During the second 15 years, Mr. Bann
furthered his career as a business leader for both global and
Korean conglomerates. He served as a corporate executive in General
Electric, and CEO of Hyundai Materials, an affiliated company of
Hyundai Motor Group. He worked for General Electric Power Business
Division to win back #1 market share for its Gas Turbine fleets in
North Asia by winning $265M of orders from global clients during severe
market downturn. Mr. Bann received a MBA from the University of Chicago.
Ezra Auerbach,
Director
Co-Founder of NABCEP and over 30 years of experience in off grid
and residential energy storage. Ezra has worked in
the solar industry since the mid 1980s, over that time he developed
a diverse skill set which he offers his clients as a renewable
energy consultant.
Vitaly Melnikov, Chief
Financial Officer and Corporate Secretary
Seasoned corporate finance executive, CPA and MBA offering over
20 years of Canadian and international financial leadership
experience building, leading, and advising corporations through
complex finance restructurings, international expansion, and
capital markets transactions. Highly skilled in collaborating with
all members of the organization to achieve business and financial
objectives. Accomplished in structuring and negotiating
transactions and favorable terms with private and institutional
investors. Excellent financial leader with a track record of
contributions streamlining financial processes, enhancing
productivity levels and internal controls.
Evan Kraemer, Chief Technology
Officer
Evan studied Geography at the University of
Regina completing his BA in 2010. He continued his studies
at the University of Regina earning a
Master's degree in Interdisciplinary through the Faculty of
Engineering and Applied Science along with Geography and
Environmental Science through May
2015. His thesis on climate change affecting water resources
and crop evapotranspiration provided the basis for his interest in
Solar PV.
Evan joined Mark at iHazmat in 2016 as Chief Regulatory Officer
and was integral part of that company's success. His main role at
iHazmat was delivering training courses for the dangerous goods
transport industry in Canada and
the USA.
He then Joined Mark at Stardust Solar as Chief Technology
Officer leading the development of their accredited solar training
material. Evan's role includes continuing education of all
employees and franchisees ensuring they all stay up-to-date with
the ever-changing technologies used in Solar PV Systems. He also
heads their solar PV system design team, creating plan sets used
for installation projects across Canada.
Sponsorship
Sponsorship of a Qualifying Transaction is required by the
Exchange unless the Transaction qualifies for an exemption from the
sponsorship requirement. Bold intends to apply for a waiver from
the sponsorship requirement in connection with the Transaction and
will provide further details in due course.
Annual and Special Meeting of Bold
Shareholders
Bold also wishes to announce that it has filed a notice of
meeting and record date in connection with its annual and special
meeting (the "Meeting") of shareholders to be held on
February 12, 2024. At the
Meeting, Bold shareholders will be asked:
- to receive the annual consolidated financial statements of Bold
for the fiscal years ended December 31,
2021 and December 31, 2022,
and the external auditors' reports thereon;
- to elect the incumbent directors of Bold;
- to re-appoint Mallette LLP as the external auditor of
Bold;
- conditional on and effective upon the completion of the
Transaction, to elect the directors of the Resulting Issuer (please
see below);
- conditional on and effective upon the completion of the
Transaction, to approve Bold's new omnibus equity incentive
plan;
- conditional on and effective upon the completion of the
Transaction, to approve an amendment to Bold's articles to change
the corporate name from "Bold Capital Enterprises Ltd." to
"Stardust Solar Energy Inc." or such other name as may be
determined by the board of directors of the Resulting Issuer;
- conditional on and effective upon the completion of the
Transaction, to approve an amendment to Bold's articles to change
the province in which the corporation's registered office is
situated from Quebec to
British Columbia; and
- conditional on and effective upon the completion of the
Qualifying Transaction, to approve an amendment to Bold's articles
so as to consolidate the issued and outstanding common shares of
the Corporation on the basis of 2.4876 common shares of Bold for
every common share of the Resulting Issuer.
As indicated above, Bold will be seeking approval from
shareholders and the Exchange for the adoption and implementation
of a new omnibus equity incentive plan (the "Omnibus Plan").
Bold will be including the full text of the Omnibus Plan in the
circular that will be sent to obtain shareholder's approval at the
upcoming Meeting. Once approved, the Omnibus Plan will replace the
corporation's current stock option plan that was last approved in
2021 and which is now a simple fixed plan (the "Previous
Plan"). The board of directors determined that it is
desirable to have a wide range of incentive awards, including stock
options ("Options"), restricted share units ("RSUs"),
performance share units ("PSUs"), and deferred share units
("DSUs") (collectively, the "Awards") to attract,
retain and motivate employees, directors, executive officers and
consultants of the corporation and the Resulting Issuer in
anticipation of the proposed Transaction. The aggregate
number of Resulting Issuer Reserved for issuance pursuant to Awards
of Options granted under the Omnibus Plan (including the
predecessor options currently outstanding under the Previous Plan)
shall not exceed 10% of the Resulting Issuer's total issued and
outstanding shares from time to time. In respect of DSUs, RSUs or
PSUs, the aggregate number of Resulting Issuer Shares reserved for
issuance pursuant to Awards other than for Options granted under
the Omnibus Plan shall not exceed 7,000,000 Resulting Issuer
Shares. The Definitive Agreement provides for the granting of
an aggregate of 500,000 Options of the Resulting Issuer to the
current board of directors of Bold immediately prior to the
completion of the Transaction.
The Meeting materials will be posted on SEDAR+ shortly.
Forward Looking
Information
This press release contains statements that constitute
"forward-looking information" ("forward-looking
information") within the meaning of the applicable Canadian
securities legislation. All statements, other than statements of
historical fact, are forward-looking information and are based on
expectations, estimates and projections as at the date of this news
release. Any statement that discusses predictions, expectations,
beliefs, plans, projections, objectives, assumptions, future events
or performance (often but not always using phrases such as
"anticipate", "believe", "continue", "estimate", "expect",
"intend", "projected" or variations of such words and phrases or
stating that certain actions, events or results "may", "could",
"would", "might" or "will" be taken to occur or be achieved) are
not statements of historical fact and may be forward-looking
information.
More particularly and without limitation, this press release
contains forward-looking statements concerning the Transaction
(including the structure, terms and timing thereof), the continued
business of Stardust, the issuance of additional news releases
describing the Transaction, the name of the Resulting Issuer, the
trading of the Bold Common Shares on the Exchange, the completion
of due diligence, and the holding of shareholder meetings in
connection with the Transaction. In disclosing the forward-looking
information contained in this press release, Bold has made certain
assumptions, including that: all parties will complete satisfactory
due diligence of the other parties; all applicable shareholder and
regulatory approvals for the Transaction will be received; and the
Transaction will be completed on mutually acceptable terms and
within a customary timeframe for transactions of this nature.
Although Bold believes that the expectations reflected in such
forward-looking information are reasonable, it can give no
assurance that the expectations of any forward-looking information
will prove to be correct. Known and unknown risks, uncertainties
and other factors may cause the actual results and future events to
differ materially from those expressed or implied by such
forward-looking information. Such factors include but are not
limited to: availability of financing; delay or failure to receive
board, shareholder or regulatory approvals; and general business,
economic, competitive, political and social uncertainties. There
can be no certainty that the Transaction will be completed on the
terms set out in the Definitive Agreement or at all. Accordingly,
readers should not place undue reliance on the forward-looking
information contained in this press release. Except as required by
law, Bold disclaims any intention and assumes no obligation to
update or revise any forward-looking information to reflect actual
results, whether as a result of new information, future events,
changes in assumptions, changes in factors affecting such
forward-looking information or otherwise.
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 highly
speculative.
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.
Neither the TSX Venture Exchange nor its Regulation
Services Provider (as that term is defined in the policies of the
TSX Venture Exchange) accepts responsibility for the adequacy or
accuracy of this news release.
The securities 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 Bold Capital Enterprises Ltd.