Berkeley Capital Corp. I
TSX VENTURE : BCP.P

October 05, 2007 18:33 ET

Berkeley Capital Corp. I Announces Proposed Qualifying Transaction With iLOOKABOUT Holdings Inc.

TORONTO, ONTARIO--(Marketwire - Oct. 5, 2007) -

NOT FOR RELEASE OR DISSEMINATION INTO THE UNITED STATES

Berkeley Capital Corp. I ("Berkeley"), a capital pool company listed on the TSX Venture Exchange (TSX VENTURE:BCP.P), announces that it entered into a letter agreement on October 4, 2007 with iLOOKABOUT Holdings Inc. ("iLOOKABOUT") for its Qualifying Transaction that is not a Non Arm's Length Qualifying Transaction in accordance with the policies of the TSX Venture Exchange. iLOOKABOUT is a private software company based in London, Ontario offering imaging solutions. The letter agreement provides for the amalgamation of Berkeley with iLOOKABOUT. The Qualifying Transaction will constitute a "business combination" under OSC Rule 61-501 for Berkeley and require minority shareholder approval. All of the common shares of Berkeley and iLOOKABOUT will be cancelled and exchanged for common shares of the amalgamated company in accordance with exchange ratios based upon the valuation of the amalgamated company in a prospectus offering or private placement to be completed concurrently with the closing of the amalgamation, the outstanding common shares, options and warrants of each company, and the price per share in the concurrent offering. Upon the closing of the Qualifying Transaction, the name of the amalgamated company will be iLOOKABOUT Corp. ("NewCo"), and the current shareholders of iLOOKABOUT will collectively exercise control over NewCo.

Completion of the proposed Qualifying Transaction is subject to, among other things, regulatory approval, shareholder approval of iLOOKABOUT and Berkeley, and the closing of the concurrent offering in the minimum amount of $5 million and the maximum amount of $10 million at an agreed per share price of $0.50, as described below.

In accordance with the terms of the letter agreement, all executive officers, directors and 5% or greater shareholders of iLOOKABOUT will enter into support agreements concurrently with the execution of the amalgamation agreement pursuant to which they will agree to vote in favour of the Qualifying Transaction and against all other matters and transactions that could adversely effect or impede the Qualifying Transaction, and agree not to transfer their shares prior to the iLOOKABOUT shareholder meeting to approve the Qualifying Transaction. Such iLOOKABOUT shareholders will grant Berkeley an irrevocable proxy to vote the shares owned by them in accordance with the support agreements.

About iLOOKABOUT Holdings Inc.

iLOOKABOUT was founded in 2000 by Jeff Young and Jeff Hack as a virtual tour software company. iLOOKABOUT was predominantly a research and development company until its proprietary virtual tour software was commercialized in 2002. iLOOKABOUT's application service provider processing service was created to provide Virtual Tour, a real estate and tourism marketing product. The system provides virtual tour photographers a convenient, web-based tool that facilitates the packaging and distribution of unique virtual tours to partner sites. Virtual Tour generates revenue based upon transaction and subscription models. iLOOKABOUT has developed a user-managed website product that it licenses on a monthly subscription basis to real estate professionals. In addition, iLOOKABOUT offers image management software called ImageStore on a license basis, and custom application programming to its customers, to enable the storage, management and reformatting of images in connection with its Virtual Tour product across large scale enterprise web applications. iLOOKABOUT has three patents pending in Canada and the United States on its proprietary Virtual Tour software and its revenues through June 30, 2007 have been derived almost exclusively from this aspect of its business.

iLOOKABOUT has developed a proprietary system called iLOOKABOUT StreetScape for collecting, processing and geo-coding street-level image data, which provides a series of panning images depicting street level frontage. iLOOKABOUT's image-capturing database is compatible with all major mapping applications (Google, Yahoo, MSN, ESRI, Intergraph, etc.) and its data is licensed through a subscription-based web service. iLOOKABOUT has completed or is currently engaged in pilot and preliminary projects for various businesses, including those in the real estate, tourism, construction and engineering markets, as well as for governments and related agencies. iLOOKABOUT expects to officially launch iLOOKABOUT StreetScape in the fall of 2007, and the company is attempting to complete the data capture for 14 cities in Canada, the United States and the European Union within the next 12 months.

iLOOKABOUT has raised approximately $3.7 million in private capital since its formation. As at October 3, 2007, the outstanding securities of iLOOKABOUT consisted of (i) 25,633,134 common shares; (ii) options to purchase an aggregate of 795,000 common shares; and (iii) warrants to purchase an aggregate of 1,828,387 common shares.

On the basis of unaudited financial statements for the year ended December 31, 2006, as at December 31, 2006, iLOOKABOUT had total assets of $483,478, liabilities of $42,671, accumulated losses of $657,884, shareholders' equity of $440,807 and available working capital of $354,180. For the fiscal year ended December 31, 2006, iLOOKABOUT recorded revenue of $336,470 and a net loss of $137,774. On the basis of unaudited financial statements prepared by management for internal use, iLOOKABOUT recorded revenue of approximately $228,000 and a net loss of approximately $303,915 for the six months ended June 30, 2007.

iLOOKABOUT currently has 17 employees and consultants. In addition, the company has retained the services of a sales agent to oversee the marketing and sale of iLOOKABOUT products and services in the European Union, and engages the services of local temporary staffing agencies and independent photographers to collect its Virtual Tour and iLOOKABOUT StreetScape data.

iLOOKABOUT was incorporated pursuant to Ontario law on October 6, 2000 as Just Iced Cubed Holdings Inc. On May 8, 2007, the company's name was changed to iLOOKABOUT Holdings Inc.

iLOOKABOUT currently has three wholly-owned subsidiaries: (i) iLOOKABOUT Inc., which was incorporated in Ontario on April 28, 2000 and is iLOOKABOUT's Canadian operating company; (ii) iLOOKABOUT Inventions Inc., which was incorporated in Ontario as Just Iced Cubed Inventions Inc. on October 6, 2000 and holds iLOOKABOUT's technology and trademarks; and (iii) iLOOKABOUT Global Inc., which was incorporated in Barbados on July 26, 2007 and conducts all of iLOOKABOUT's non-Canadian operations and owns all data collected by iLOOKABOUT outside of Canada.

Terms of the Proposed Qualifying Transaction

The letter agreement provides that upon Berkeley's amalgamation with iLOOKABOUT, all of the common shares of Berkeley and iLOOKABOUT will be cancelled and exchanged for shares of NewCo in accordance with exchange ratios based upon the valuation of iLOOKABOUT in the concurrent offering and a fixed valuation of $1,916,666 agreed to by the parties for Berkeley, the aggregate number of common shares of iLOOKABOUT and Berkeley outstanding or issuable upon the exercise of all options, warrants and other rights outstanding to acquire common shares of iLOOKABOUT and Berkeley, and the price of common shares of NewCo issued in the concurrent offering described below. Holders of options to purchase Berkeley common shares will receive from NewCo an option to purchase an adjusted number of common shares of NewCo based on the exchange ratio at a correspondingly adjusted exercise price.

Subject to applicable regulatory approval, holders of options and warrants to purchase common shares of iLOOKABOUT will receive from NewCo an option or warrant, as applicable, to purchase an adjusted number of common shares of NewCo based on the exchange ratio at a correspondingly adjusted exercise price. Preliminary indications from prospective agents for the concurrent offering are that the valuation of iLOOKABOUT will be between $30 million and $36 million, and the parties have agreed that the Qualifying Transaction will be conditional on the completion of the concurrent offering on mutually satisfactory terms. Assuming a valuation of iLOOKABOUT of $35 million, the iLOOKABOUT exchange ratio would be approximately 2.4773. Based upon the agreed fixed valuation for Berkeley, the Berkeley exchange ratio will be approximately 0.3333. According to such exchange ratios and the proposed per share offer price of $0.50 in the concurrent offering, an aggregate of 63,501,072 NewCo common shares would be issued to the current holders of iLOOKABOUT common shares, and an aggregate of 3,367,340 NewCo common shares would be issued to the current holders of Berkeley common shares.

Between now and the amalgamation, holders of iLOOKABOUT options and warrants may exercise such securities, resulting in the issuance of additional iLOOKABOUT common shares, with the result that the number of common shares of NewCo to be issued to holders of common shares of iLOOKABOUT will increase, while the number of common shares reserved of NewCo for issuance to holders of iLOOKABOUT options and iLOOKABOUT warrants will correspondingly decrease. For greater clarity, the consideration to be issued to the holders of common shares iLOOKABOUT and Berkeley will not be increased to take into account, or otherwise give effect to, the exercise price associated with outstanding options and warrants.

Currently each of Jeff Young, Jeff Hack, Cassandra Capital LP and The Dukes Trust, either directly or through entities controlled by them or over which they exercise control, each owns 10% or more of the outstanding common shares of iLOOKABOUT. Cassandra Capital LP is an Ontario limited partnership controlled by John Drake, a Berkeley director. The Duke Trust is a Jersey, United Kingdom trust controlled by HSBC, as trustee, for the benefit of E Digital Consulting Ltd., a United Kingdom company that is controlled by Mark Hadley, which provides sales agency services to iLOOKABOUT in European. Jonathan Drake, an iLOOKABOUT director, owns approximately 4.0% of the outstanding common shares of Berkeley. Brice Scheschuk and Simon Lockie, each a Berkeley director, are investors in iLOOKABOUT and own approximately 0.8% and 0.1% of the outstanding common shares of iLOOKABOUT, respectively. Each of John Drake, Simon Lockie and Brice Scheschuk, being all of the directors and officers of Berkeley, hold approximately 13.2% of the outstanding common shares of Berkeley.

Following the completion of the Qualifying Transaction and the concurrent offering, the principal shareholders of NewCo, either directly or through entities controlled by them or over which they exercise control, will be Jeff Young, Jeff Hack, John Drake (via Cassandra Capital LP) and The Dukes Trust, all of whom are residents of Ontario other than The Dukes Trust, which is a resident of Jersey, United Kingdom.

After the completion of the Qualifying Transaction and the concurrent offering at an assumed amount of $7.5 million, Jeff Young and Jeff Hack will each own or control, either directly or indirectly, 16.3% of the outstanding common shares of NewCo, and John Drake (including the shares of Cassandra Capital LP) will own 15.4% of the outstanding common shares of NewCo, respectively.

Upon completion of the Qualifying Transaction, it is expected that NewCo will be a Tier 1 issuer pursuant to the policies of the TSX Venture Exchange. Upon closing of the Qualifying Transaction, and assuming $7.5 million is raised in the concurrent offering at a valuation of $35 million for iLOOKABOUT, there would be 88,834,100 NewCo common shares outstanding or issuable upon exercise of outstanding options and warrants. Of these, the current shareholders and other security holders of iLOOKabout would hold an aggregate of 70,000,000 shares, or approximately 78.8%, the current shareholders of Berkeley would hold an aggregate of 3,834,100 shares, or approximately 4.3%, and investors in the offering would hold an aggregate of 15,000,000 shares, or approximately 16.9%.

Concurrent Offering

The Qualifying Transaction with be conditional upon the completion of a NewCo concurrent prospectus offering or private placement of not less than 10,000,000 common shares and not more than 20,000,000 common shares, sold at $0.50 per share, representing a minimum offering of $5 million and a maximum offering of $10 million. Preliminary indications from prospective agents are that the valuation of iLOOKABOUT for the concurrent offering will be between $30 million and $36 million. iLOOKABOUT and Berkeley will mutually select the agent to NewCo in respect of the offering.

The proceeds from the concurrent offering, together with the combined working capital of iLOOKABOUT and Berkeley following the completion of the proposed Qualifying Transaction, will be used for data capture, expansion of infrastructure, sales and marketing initiatives and for working capital. Upon completion of the proposed Qualifying Transaction and concurrent offering, iLOOKABOUT anticipates having sufficient financial resources to carry on its business plan for a period of at least 18 months.

Berkeley intends to apply to the TSX Venture Exchange for a waiver of the sponsorship requirements for the Qualifying Transaction based upon the brokered concurrent offering.

Proposed Directors and Management Team

At the closing of the Qualifying Transaction, Jeff Young, Jeff Hack, Jonathan Drake and Alfred Jay will be the nominees of iLOOKABOUT to be elected to the Board of Directors of NewCo. Brice Scheschuk will be the nominee director of Berkeley to be elected to the Board of Directors of NewCo and appointed as Chairman of the Board. Upon completion of the Qualifying Transaction, the new senior management team of NewCo will consist of Jeff Young, President and Chief Executive Officer, Jeff Hack, Chief Technology Officer, Mark Sheppard, Chief Operating Officer, and Robin Dyson, Chief Financial Officer and Secretary.

The following are brief resumes of the currently proposed directors and senior officers of NewCo following the Qualifying Transaction:

Brice Scheschuk, President, Chief Executive Officer, Chief Financial Officer and Secretary and Director, Berkeley Capital Corp. I - Mr. Scheschuk, 36, is the Chief Financial Officer of Globalive Communications Corp., a provider of telecommunications solutions globally, and has been with Globalive since September 2003. He is also the Co-President and Secretary of Brave Consulting Corporation, a private investment company, and has held those positions since May 2000. He is a director of Hy-Drive Technologies Inc., a TSX-Venture listed company as well as numerous private companies. Mr. Scheschuk has 13 years of financial experience in the telecommunications, technology, media and financial industries. From April 2001 to September 2003, Mr. Scheschuk was the Corporate Controller of Leitch Technology Corporation, a manufacturer of hardware and software for the professional video market listed on the Toronto Stock Exchange. From March 1999 to March 2001, he was Vice President of Finance and Secretary of Level Jump Financial Group, Inc. (and predecessor companies), an investor relations company listed on the U.S. OTC Bulletin Board and a NASD registered broker-dealer. Mr. Scheschuk received a B.Comm. (Honours) Finance degree from Dalhousie University in April 1994 and earned his Canadian Chartered Accountant designation while working for Coopers & Lybrand (now PricewaterhouseCoopers) from May 1994 through September 1998.

Jeffrey Young, President and Chief Executive Officer and Director, iLOOKABOUT Holdings Inc.- Mr. Young, 41, is a founder of iLOOKABOUT and has served as its President and Chief Executive Officer since its formation in 2000. Mr. Young has founded two companies and has 17 years experience as President and Chief Executive Officer of such companies. From February 1992 to August 2003, Mr. Young was founder, President and Chief Executive Officer of National Flag Distributors, which was the largest flag distribution operation in London, Ontario prior to its sale in 2003. From February 1990 to September 1993, he was the President and Chief Executive Officer of Vernor's Bottling Company, in London, Ontario. From November 1994 to present, Mr. Young has been the Secretary and Treasurer of DJ Consortium Inc., a real estate investment company. From April 1994 to December 1999, Mr. Young served as President of Bubba's Diner, Restaurant and Catering. Mr. Young has a Bachelor of Arts Degree from the University of Western Ontario.

Jeffrey Hack, Chief Technology Officer and Director, iLOOKABOUT Holdings Inc. - Mr. Hack, 44, founded iLOOKABOUT with Jeffrey Young in 2000 and has been the Chief Technology Officer of iLOOKABOUT since that time. Mr. Hack has extensive software engineering experience and is the inventor of all of iLOOKABOUT's proprietary software to date, including the technology comprising iLOOKABOUT's patents and patents pending. From 1998 to the fall of 2000, Mr. Hack worked with Mr. Young for National Flag Distributors, providing graphic design services. From 1993 to 2000, Mr. Hack provided software development and programming consulting services primarily to real estate and window and door manufacturing businesses. Mr. Hack attended Civil Engineering Courses at the University of Western Ontario from September 1991 to April 1996.

Robin Dyson, Chief Financial Officer and Secretary, iLOOKABOUT Holdings Inc. - Ms. Dyson, 34, joined iLOOKABOUT in July 2007 as its Chief Financial Officer. Ms. Dyson has been a Chartered Accountant for 6 years, and has both public accounting and industry experience. Immediately prior to becoming Chief Financial Officer of iLOOKABOUT, Ms. Dyson was a Manager with KPMG LLP, working out of its London and Waterloo offices. Ms. Dyson also worked for KPMG LLP as a Staff Accountant in the Assurance Group and later as a Senior Accountant in the Corporate Recovery Group from September 1998 to May 2001. From June 2001 to January 2002, she was Internal Audit Manager for London Life Insurance Company. From January 2002 to January 2004, she held the position of Assistant Controller at JMP Engineering Inc., in London, Ontario. Before rejoining KPMG LLP in August 2004, Ms. Dyson was the Finance Controller for Filogix Inc, also in London Ontario. Ms. Dyson received her Bachelor of Arts (Honours Business Administration) Degree from the Richard Ivey School of Business, University of Western Ontario in 1998 and her Chartered Accountant designation in 2001.

Mark Sheppard, Chief Operating Officer, iLOOKABOUT Holdings Inc. - Mr. Sheppard, 42, originally joined iLOOKABOUT in 2000 as its Vice-President, Business Development and Strategy, and was promoted to Chief Operating Officer in July 2007. Mr. Sheppard has 15 years of marketing and operational experience that span several industries. Immediately prior to joining iLOOKABOUT, Mr. Sheppard held the position of marketing manager at MyPlant.com, an e-business initiative launched by Honeywell Inc. From 1999 to 2000, Mr. Sheppard was a Procurement Analyst and Consultant with Dofasco Inc., in Hamilton, Ontario. From 1994 to 1998 Mr. Sheppard was a Marketing Representative with Pearson Educational and he worked as Campaign Manager for the Heart and Stroke Foundation in 1992 and 1993. Mr. Sheppard received his Master of Business Administration from the Richard Ivey School of Business at the University of Western Ontario in 2000.

Alfred Adrian Jay, Director, iLOOKABOUT Holdings Inc. - Since founding Ramius Corporation, in January 1998, Mr. Jay, 39, has served as its President and Chief Executive Officer. Ramius is an Internet software company focused on the development of social software, which has developed and commercialized its proprietary award-winning Java-based software, attracting over 1.5 million users worldwide. The company's enterprise customers include SAP, NASA, Juniper Networks, Compuware, IEEE, Kaiser Permanente, and Nokia. In 2000, Mr. Jay was named to the Ottawa Business Journal Top Forty under 40. Prior to founding Ramius, he held the position of Vice President of AlphaGraphics, an Ottawa based franchisee of an electronic printing organization headquartered in Tucson Arizona Mr. Jay received his Bachelor of Arts (Honours Business Administration) from the Richard Ivey School of Business at the University of Western Ontario in 1990.

Jonathan Drake, Director, iLOOKABOUT Holdings Inc. - Since May of 2005, Mr. Drake has held the position of Securities Analyst at Whippoorwill Holdings Inc., a London-based Private Equity/Venture Capital Investment Company. From June 2000 to December 2004, Mr. Drake was a Business Consultant to Whipporwill Holdings on a part-time basis. From January 2002 to October 2003, Mr. Drake was a consultant to Palmieri's Fine Foods, a London-based restaurant business. In addition to his duties as a director of iLOOKABOUT, Mr. Drake is also a director of Calotto Capital Inc., a TSXV capital pool company, and Welles Remy Crother Charitable Trust, a September 11 charity. Mr. Drake received his Bachelor of Arts from Boston College in Massachusetts in 1999.

Conditions to Completion of Qualifying Transaction

Completion of the Qualifying Transaction is subject to a number of conditions, including, but not limited to, the closing of the concurrent offering, acceptance by the TSX Venture Exchange, NewCo's satisfaction of the minimum listing requirements of the TSX Venture Exchange for a Tier 2 issuer, other regulatory approvals and third party consents, shareholder approval of iLOOKABOUT and Berkeley (including majority of the minority for Berkeley), completion of satisfactory legal, accounting and financial due diligence by both Berkeley and iLOOKABOUT, and completion of formal agreements, including an amalgamation agreement among Berkeley and iLOOKABOUT and certain of iLOOKABOUT's security holders. The transaction cannot close until the required shareholder approval of iLOOKABOUT and Berkeley is obtained. There can be no assurance that the Qualifying Transaction will be completed as proposed or at all.

Investors are cautioned that, except as disclosed in the management information circular to be prepared in connection with the Qualifying Transaction and any prospectus prepared in respect of the concurrent offering, any information released or received with respect to the Qualifying 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.

Cautionary Note Regarding Forward-looking Statements

This news release contains forward-looking statements (including, without limitation, information regarding the proposed Qualifying Transaction and the business opportunities of iLOOKABOUT and the amalgamated company) that involve risks and uncertainties that could cause the results of Berkeley to differ materially from management's current expectations. Actual results may differ materially due to a number of factors including, among others: the Qualifying Transaction may not close; market acceptance of iLOOKABOUT's products and services; the impact of competitive products and services; the possibility of such products and services infringing patents and other intellectual property rights of third parties; and costs of product development. The matters discussed in this news release also involve risks and uncertainties described in Berkeley's documents filed from time to time with the Canadian securities regulatory authorities. Berkeley assumes no obligation to update the forward-looking information contained in this new release.

iLOOKABOUT, ImageStore and iLOOKABOUT StreetScape are trademarks of iLOOKABOUT Holdings Inc. Other names mentioned herein are the property of their respective owners.

The TSX Venture Exchange has in no way passed upon the merits of the proposed transaction and has neither approved nor disapproved the contents of this press release. The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy for this release.

Contact Information

  • Berkeley Capital Corp. I
    Brice Scheschuk
    President
    (416) 204-0240
    or
    iLOOKABOUT Holdings Inc.
    Jeff Young
    President and Chief Executive Officer
    (519) 963-2015