Leezamax Capital Corp.

November 05, 2009 13:06 ET

Leezamax Capital Corp. Announces Proposed Qualifying Transaction

SURREY, BRITISH COLUMBIA--(Marketwire - Nov. 5, 2009) - Leezamax Capital Corp. of Surrey B.C. (TSX VENTURE:LZX.P) ("Leezamax" or the "Corporation") is pleased to announce that that it has entered into a letter of intent dated August 28, 2009 (the "Agreement") pursuant to which it intends to acquire all of the issued and outstanding common shares of Longview Advantage Limited ("Longview"), a Calgary-based company that provides remote fleet and asset management solutions to business, in exchange for the issuance of common shares ("Common Shares") in the capital of the Corporation (the "Longview Acquisition"). It is expected that the Longview Acquisition will constitute a "Qualifying Transaction" for the Corporation as such term is defined in the policies of the TSX Venture Exchange Inc. (the "Exchange").

Pursuant to the terms of the Agreement, it is intended that Longview will, in conjunction with the completion of the Longview Acquisition: (i) complete a private placement financing of units for gross proceeds of a minimum of $600,000, and a maximum of $1,500,000 (the "Private Placement"), and (ii) facilitate the conversion of outstanding shareholder loans in the amount of approximately $1,200,000. Leezamax will also complete a smaller private placement of up to 333,333 Common Shares at a deemed price of $0.15 for maximum gross proceeds of $50,000. At the meeting to be held to approve the Qualifying Transaction with Longview, shareholders will also be asked to approve the consolidation of the Common Shares on the basis of one 'new' common share for each two 'old' common shares. In addition, subject to the approval of the shareholders of Leezamax, it is expected that the Corporation will change its name to "Longview Advantage Corporation", or such other similar name as is acceptable to regulatory authorities and approved by the board of directors.

A special meeting of the shareholders of Leezamax (the "Meeting") will be held to consider and approve certain aspects of the Qualifying Transaction in accordance with the policies of the Exchange and the Business Corporations Act (Alberta), including the appointment of the new board of the Resulting Issuer (as defined in Exchange Policy 2.4), the consolidation of the Common Shares and the change of name. Management of Leezamax will prepare an information circular to be mailed to shareholders of Leezamax in respect of a meeting at which shareholders will be asked to approve the Longview Acquisition by Majority of the Minority Approval (as defined in Exchange Policy 2.4). There can be no guarantee that the shareholders of Leezamax will approve the Longview Acquisition.

All information contained in this news release with respect to Longview was supplied by Longview, and with respect to such information, Leezamax and its board of directors and officers have relied on Longview.

Highlights of the Transaction

The Parties

The Corporation was incorporated on April 9, 2007, under the provisions of the Business Corporations Act (Alberta) and is based in Surrey, British Columbia.

Leezamax is a CPC, as defined in Exchange Policy 2.4 and is governed by the policies of the Exchange. Leezamax common shares trade on the Exchange under the symbol LZX.P. Leezamax's only business is the identification and evaluation of assets or businesses with a view to completing a Qualifying Transaction, as defined in Exchange Policy 2.4.

Longview is a corporation existing under the laws of the Province of Alberta with its head office situated in Calgary, Alberta. Longview is a company which provides leading edge, high value, remote fleet, and asset management, solutions to business. Longview was originally founded in 1999 under the name, Asset Tracking Services, and changed its name to Longview Advantage Limited in 2004, to connote the need for businesses to look to the long term, or strategic view of their business, and choose a partner who was also focused on providing this capability.

New ownership in 2007 changed the company from a technology development company to one solely focused on marketing innovative, value added fleet and asset management solutions to business. Longview has partnered with leading fleet management applications and technology providers, to provide state of the art solutions for its customers.

Longview strives to provide innovative customer solutions that are not only leading edge but create value for the user. Longview is a strong proponent of "value" solutions and works with customers to ensure its solutions deliver a positive return on investment in relatively short timeframes. Longview becomes an integral part of the customer team during implementation of the new value-added solutions. This entails assisting customers with internal administrative changes often needed to ensure the technology solution is not just an "executive" driven solution but one understood and embraced by all levels of the customers' organization. In this way Longview provides a full "end to end" solution that no others in the industry offer.

The following is a summary of Longview financial information (unaudited) prepared by Longview's management for the year ended December 31, 2008:

- total assets $124,045
- total liabilities $1,172,680
- total revenue $718,965
- net income/(loss) ($535,206)

Upon completion of the Longview Acquisition, Longview will be a wholly owned subsidiary of the Corporation. It is anticipated that Leezamax will be a Tier 2 Industrial Issuer under the policies of the Exchange.

The Longview Acquisition

Subject to the completion of satisfactory due diligence, a definitive share acquisition agreement and receipt of applicable regulatory and shareholder approvals, the Corporation intends to acquire all of the outstanding and issued common shares of Longview such that Longview will be a wholly owned subsidiary of Leezamax upon completion of the Longview Acquisition.

The consideration to be paid by Leezamax, for all of the Longview common shares issued and outstanding at the time of closing, shall be satisfied by the issuance of:

i) 5,500,000 post-consolidated Common Shares to the existing shareholders
of Longview, at a deemed price of $0.40 per share,

ii) 4,000,000 post-consolidated Common Shares to existing creditors of
Longview for conversion of shareholder loans, at a deemed price of
$0.30 per share, and

iii) a minimum of 1,500,000 post-consolidated Common Shares, and a maximum
of 3,750,000 post-consolidated Common Shares to investors in the
Private Placement, at a deemed price of $0.40 per share.

The final number of Common Shares to be issued shall be subject to final adjustment as agreed upon by the parties, and subject to completion of the Private Placement and conversion of shareholder loans, as contemplated below, in Longview.

The principal shareholders of Longview are William Quinney of Calgary, Alberta and Adrian Levy of Vancouver, B.C. Messrs. Quinney and Levy each hold approximately 45.5% of the currently issued and outstanding shares of Longview. After giving effect to the debt conversion and the minimum Private Placement Messrs. Quinney and Levy will each hold approximately 19.9% of the Resulting Issuer. After giving effect to the debt conversion and the maximum Private Placement Messrs. Quinney and Levy will each hold approximately 16.9% of the Resulting Issuer.

Related Transactions

In connection with the Longview Acquisition, it is intended that Longview will complete the Private Placement and further obtain the conversion to common shares of Longview of approximately $1,200,000 in existing shareholder loans, each of which is summarized below.

The Private Placement

Concurrently with, and as a condition of the Longview Acquisition, Longview will complete the Private Placement for gross proceeds of a minimum of $600,000 and a maximum of $1,500,000. The net proceeds of the Private Placement will be used for general working capital. Pursuant to the Private Placement, Longview will issue up to 3,750,000 units of Longview (the "Units") at a deemed price of $0.40 per Unit. Each Unit will be comprised of one common share and one common share purchase warrant ("Warrant"). Each Warrant will entitle the holder to purchase one common share at a price of $0.50 per share for a period of two years following the closing of the Private Placement. It is anticipated that a term of the Warrants will allow the Resulting Issuer to deem conversion of the Warrants if the common shares of the Resulting Issuer trade at or above a predetermined price for more than 20 days.

Conversion of Shareholder Loans

Longview will also facilitate the conversion of approximately $1,200,000 of shareholder loans that are currently outstanding. It is anticipated approximately 4,000,000 common shares of Longview will be issued at a deemed price of $0.30 per share in consideration of the conversion of the shareholder loans.

Share Capital of the Corporation

The Corporation currently has 2,833,333 common shares issued and outstanding. Assuming completion of an initial private placement of up to 333,333 Common Shares at a deemed price of $0.15, there will be a total of 3,166,666 Common Shares issued and outstanding prior to Completion of the Qualifying Transaction. These Common Shares will be consolidated on the basis of one 'new' common share for each two 'old' common shares, leaving a maximum of 1,583,333 post-consolidated Common Chares issued and outstanding on closing of the Qualifying Transaction. Assuming the completion of the Longview Acquisition, namely: (i) the issuance of 5,500,000 post-consolidated Common Shares as consideration for the Longview common shares; (ii) the issuance of a minimum of 1,500,000 post-consolidated Common Shares and a maximum of 3,750,000 post-consolidated Common Shares pursuant to the Private Placement; and (iii) the issuance of 4,000,000 post-consolidated Common Shares for the converted Longview shareholder loans, the Resulting Issuer will have a minimum of approximately 12,582,333 post-consolidated Common Shares and a maximum of approximately 14,833,333 post-consolidated Common Shares issued and outstanding, of which the former shareholders of Longview will own approximately 87 %, based on the minimum Private Placement or approximately 89%, based on the maximum Private Placement.

Conditions Precedent to Completion of the Transaction

Completion of the Transaction is subject to a number of conditions, including but not limited to:

i) one or more of the principals of Longview subscribing for a private
placement into Leezamax for an amount of between $25,000 and $50,000
at a price of $0.15 per pre-consolidated Common Share within 30 days
of the issuance of this press release;

ii) completion of the Private Placement by Longview for a minimum of
$600,000 and maximum of $1.5 million gross proceeds, which Private
Placement shall satisfy TSX Venture Exchange requirements for public

iii) approval of all regulatory bodies, including, but not limited to, the
TSX Venture Exchange, the Alberta Securities Commission and the
British Columbia Securities Commission, having jurisdiction in
connection with the subject transactions;

iv) approval of the final terms and conditions of the Longview
Acquisition by the board of directors of Leezamax and the board of
directors of Longview;

v) "Majority of the Minority Approval" of the shareholders of Leezamax,
as defined in TSX Venture Exchange Policy 2.4;

vi) approval of the shareholders of Longview for the Longview

vii) as required, the entering into of formal agreements reflecting the
proposed Longview Acquisition, which are agreeable to all parties;

viii) the Longview Acquisition being accepted by the Exchange as Leezamax's
Qualifying Transaction with a Final Exchange Bulletin being released
by no later than December 31, 2009, or such other date the parties
may agree upon.

Arm's Length Transaction

Under the policies of the Exchange, the Longview Acquisition was negotiated as and is being completed as an arm's length transaction.

Proposed Management

Upon completion of the Longview Acquisition, it is anticipated that Leezamax's board of directors will change with the election of Longview's nominees, including William Quinney, and Adrian Levy.

The backgrounds of each of the proposed members of the board of directors and senior management of the Resulting Issuer are as follows:

William Quinney, B. Eng

Board Chairman, Director - Calgary AB

Mr. Quinney spent his early career as an executive with John Deere Limited in Hamilton, Regina, Edmonton, and Winnipeg leaving the company to lead Agro Equipment, the John Deere dealership in Calgary (consistently recognized as one of the 10 best dealerships in Canada and was always in Calgary's Top 100 Companies). After selling the company in 2000, Mr. Quinney joined Longview as a consultant. In early 2007 with a change in ownership, Mr. Quinney became President. During his career he was the President of Canada West Equipment Dealers Association and the North America Dealers Association. In 2003 Mr. Quinney was appointed to the Olds College Board of Governors by the Province of Alberta and in 2007 was appointed to his current position as Chairman of the Board of Longview.

Don Douglas, B.A.

President/Chief Executive Officer, Calgary Alberta

Mr. Douglas has focused his career within the dynamic high tech sector since his graduation from the University of Alberta. Mr. Douglas has held senior and executive management positions within the telecommunications and information technology sectors, principally within sales, marketing, business development and general management. Prior to Longview, he held executive positions with Nortel Networks, Maxlink Communications, Japan Radio Corporation, and Tandem Computers/Compaq Canada. Most recently Mr. Douglas has used his consulting and advisory practice, Don Douglas & Associates, to assist a number of early stage technology focused companies, developing and implementing business strategies and plans that have enabled many to achieve immediate market success.

Todd Noble, B.Comm., B.A., CFA

Vice President Finance/Chief Financial Officer

Prior to joining Longview, Mr. Noble was the VP Finance and CFO from 2000 to 2005 for two U.S. public companies - Advanced ID Corporation, a developer/manufacturer of radio frequency identification (RFID) technology and GiveMePower Corporation, an early-stage CAD/graphics software technology company. From 1999 to 2000, Mr. Noble consulted in the energy industry where he provided corporate finance and treasury services to AltaGas Income Trust and Suncor Energy. During 1997 to 1998, Mr. Noble was Treasurer of the Forzani Group, the largest specialty retailer of sporting goods in Canada trading on the TSX. From 1994 to 1997, Mr. Noble held roles with increasing levels of responsibility in the Treasury department at Agrium, an international fertilizer producer trading on the NYSE and TSX. As Treasury Manager, he completed numerous finance and capital market initiatives valued in excess of $1.4 billion. During 1992 to 1994, Mr. Noble was a Senior Account Manager at Bank of America, a NYSE company, where he managed the Foreign Currency Services division for southern Alberta.

Adrian Levy

Director - Vancouver, British Columbia

Adrian Levy is the President and CEO of Levy Lorber, a partnership of Adrian Levy and Dr. Robert Lorber. Adrian Levy and Dr. Robert Lorber have worked together since 1979. Together their organization has implemented productivity improvement systems for companies on five continents - Kraft Foods, Teichert Inc., SantaFe International, Chevron, BP/Amoco, Occidental Petroleum, Gillette, Sutter Health, American Express, Mattel, Allied Signal, Raley's VSP, Maxtor, ETS, Wells Fargo, Pillsbury, Pfizer, Kaufman and Broad, Tower, Interfor, Canfor, and many other medium and Fortune 500 companies.

Adrian Levy is an internationally recognized expert on performance coaching, performance management, change implementation, leadership, teamwork, culture and organizational development strategy. He has over 25 years practical experience in leading resources worldwide on performance coaching and corporate change. Mr. Levy is an established professional speaker who has delivered presentations for university, profit and non-profit audiences in North America. He has also shared his insights at universities and on radio and with newspaper audiences across the country. Also, Mr. Levy serves on a non-for-profit Board in the health care industry.

Adrian Levy has a Bachelor of Science Degree in Behavioral Psychology and a Masters of Science Degree in Counseling from Long Island University, New York.

Terry Rogers

Director - Surrey British Columbia

Mr. Rogers has been retired since March 2002. He is currently President, CEO and a director of Leezamax. Mr. Rogers was President, CEO and a director of Ryjencap Inc. a capital pool company from January 2005 to June 2006. Ryjencap Inc. completed its Qualifying Transaction and is now trading as Empire Industries Ltd. Prior to this was the President, Chief Executive Officer, and a director of another CPC, Dewmella Inc. (Contact Image Corporation), from July 2003 to November 2004. Mr. Rogers was Vice President from May 1994 to October 2001 of Ezenet Inc., a publicly traded company on the TSE starting in October 1999. He received his B. Comm. from Concordia University in 1967 and his chartered accountant designation from the Institute of Chartered Accountants of British Columbia in 1972. Mr. Rogers is not practising as a chartered accountant, however his designation remains in effect and his membership in the Institute of Chartered Accountants of British Columbia is current.

It is anticipated that Messrs. Rogers, Levy and Quinney will form the audit committee of the Resulting Issuer.

Temporary Relief Measures

Pursuant to the Exchange Bulletin dated September 11, 2009, End of Temporary Relief Measures Period, Leezamax has made application to the Exchange to extend the time for completion of a Qualifying Transaction to March 31, 2010. The Exchange has granted approval for this extension of time, subject to Leezamax obtaining approval pursuant to the Business Corporations Act (Alberta) for an extension of time to hold an annual meeting to no later than March 31, 2010. The Corporation will be making this application as soon as possible and expects to receive approval for the extension. The meeting called to approve the Qualifying Transaction will be an annual and special shareholder meeting.

Sponsorship and Resumption of Trading

Leezamax is currently seeking a sponsor for the proposed Qualifying Transaction in accordance with Exchange requirements. It is expected that trading in the shares of Leezamax will remain halted until a sponsor has been engaged and the sponsor files a Sponsorship Acknowledgement Form with the Exchange.

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 information circular, 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.

Forward-Looking Statements

Certain statements contained in this news release constitute forward looking statements. The use of any of the words "anticipate", "continue", "estimate", "expect", "may", "will", "project", "should", "believe", "subject to" and similar expressions are intended to identify forward-looking statements. These statements involve known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking statements are based on reasonable assumption but no assurance can be given that these expectations will prove to be correct and the forward-looking statements included in this news release should not be unduly relied upon.

Neither 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 release.

Contact Information

  • Leezamax Capital Corp.
    Terry Rogers
    President and CEO
    (604) 531-8113
    Longview Advantage Limited
    William Quinney
    (403) 291-2905