Bling Capital Corp.
TSX VENTURE : BLI.P

March 27, 2008 18:34 ET

Bling Capital Corp. Announces Letter of Intent to Acquire All the Outstanding Securities of DataTrail Inc. in Conjunction With Acquisition of ON4 Communications, Inc.

CALGARY, ALBERTA--(Marketwire - March 27, 2008) -

NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES. ANY FAILURE TO COMPLY WITH THIS RESTRICTION MAY CONSTITUTE A VIOLATION OF U.S. SECURITIES LAWS.

Further to its press release dated November 2, 2007 announcing the acquisition of the outstanding securities of ON4 Communications, Inc. ("ON4") as the proposed qualifying transaction of Bling Capital Corp. (the "Corporation"), (TSX VENTURE:BLI.P) the Corporation is pleased to announce that it has also entered into a second letter of intent with DataTrail Inc., a company incorporated pursuant to the laws of Alberta (the "Target" or "DataTrail") dated March 20, 2008 (the "Letter of Intent"), whereby the Corporation has agreed to acquire all of the issued and outstanding securities of the Target (the "Proposed Acquisition"), ON4 and DataTrail will both become subsidiaries of the Corporation upon completion of the Proposed Acquisition and the acquisition of the outstanding securities of ON4 (the "ON4 Acquisition").

The Target is a private company in the business of providing location-based services ("LBS") solutions. The Proposed Acquisition was negotiated at arm's length.

The Proposed Acquisition

Terms of the Proposed Acquisition

Pursuant to the terms of the Letter of Intent, and subject to the fulfillment of certain conditions, the Corporation intends to acquire all of the common shares and preferred shares of the Target, ("Target Shares"), all warrants to purchase common shares of the Target ("Target Warrants") and all options to purchase common shares of the Target (the "Target Options"), which are outstanding as at the date of the closing of the Proposed Acquisition. It is expected that the Proposed Acquisition will occur by way of business combination and will be subject to regulatory approval. The Letter of Intent contains certain conditions, including among others the completion of the ON4 Acquisition.

As of the date of the Proposed Acquisition it is anticipated that the securities of DataTrail will consist of 16,230,298 Class "A" common shares, 6,069,440 Target Warrants and 2,482,926 Target Options, subject to adjustment. As of the date hereof, the McCann Family Holding Company ("MFHC"), the principal shareholder of the Target, holds 12,403,191 Target Shares and 4,555,555 Target Warrants.

Pursuant to the terms of the Letter of Intent, the holders of Target Shares ("Target Shareholders"), shall receive, as consideration for the Proposed Acquisition, an aggregate of 10,914,597 common shares of the Corporation (each a "Bling Share") at a deemed price of $0.45 per Bling Share. Additionally, the Target Options will be exchanged for 1,669,725 options of the Corporation (the "Bling Options") each Bling Option entitling the holder to purchase one Bling Share at an exercise price of $0.45 per Bling Share and the Target Warrants will be exchanged for 4,081,593 warrants of the Corporation (the "Bling Warrants") each Bling Warrant entitling the holder to purchase one Bling Share at exercise prices ranging from $0.65 to $0.75 per Bling Share on such other terms and conditions acceptable to the parties and the Exchange. The Corporation has also agreed to repay several debts of the Target. The Bling Shares to be issued pursuant to the Proposed Acquisition will be subject to the escrow requirements of the Exchange, if applicable.

Upon completion of the Proposed Acquisition, the Corporation will carry on the business of the Target and ON4 as currently constituted and it is expected that the Corporation will be classified as a Tier 2 Technology issuer under the policies of the Exchange.

The Private Placement

In conjunction with the Proposed Acquisition, the Corporation intends to complete a private placement of a maximum of $5,000,000. A minimum dollar amount will be determined in consultation with the Exchange for the purposes of meeting minimum listing requirements, at a purchase price that is to be determined and is acceptable to the Corporation and the Target, acting reasonably and in good faith. The proceeds from the private placement will be utilized to provide the Corporation with additional working capital to carry on the business plans of On4 and DataTrail on a consolidated basis to continue research and development efforts, expand sales and marketing, extend existing commercial activities, purchase additional inventory, and for general corporate purposes.

Board Composition

Upon closing of the ON4 Acquisition and the Proposed Acquisition, the board of directors of the Corporation will be reconstituted to consist of 4 directors, which shall be comprised of three nominees of ON4 and one nominee of MFHC, who all shall be subject to the approval of the Exchange and compliance with all appropriate corporate and securities legislation.

The Target

DataTrail's business involves the sale of LBS solutions. DataTrail delivers solutions through the use of wireless global positioning system ("GPS") devices from numerous manufacturers, data communications from multiple wireless carriers, DataTrail-designed and built proprietary web-based software, and enterprise scale information technology infrastructure. The DataTrail platform supports multiple LBS solutions for sale through resellers and directly to large customers and also provides professional services to resellers to develop LBS solutions for specific market verticals. Over the past two years, DataTrail has targeted the manufacturing and cargo transportation industries with high performance tracking solutions for asset security and improved logistics. Through its partnership with ON4, DataTrail plans to expand into consumer applications in 2008.

All information provided in this press release related to the Target has been provided by management of the Target and has not been independently verified by management of the Corporation.

Update

The Corporation is continuing its due diligence on the Qualifying Transaction and is actively working towards preparing the disclosure documents and filing materials required by the Exchange. In addition, as previously announced, ON4 intended on completing a private placement to a maximum of US$2,000,000 at a price of US$1.00 per share. ON4 has advised the Corporation that currently, it has raised aggregate proceeds of US$1,760,600 pursuant to that press release.

The Corporation completed its previously announced private placement of 816,667 Bling Shares at $0.30 per share for gross proceeds of $245,000 on March 17, 2008. The proceeds will be used to pay for the ongoing costs associated with identifying and evaluating potential qualifying transactions, including those previously disclosed, and to pay for the costs of the private placement.

Sponsorship of Qualifying Transaction

Sponsorship of a "qualifying transaction", as such term is defined in the policies of the TSX Venture Exchange (the "Exchange"), of a capital pool company is required by the Exchange unless exempt in accordance with Exchange policies. The Corporation is currently negotiating with a member firm to act as the sponsor for the Qualifying Transaction and the particulars will be disclosed when available.

Insiders of the Resulting Issuer and Summary Financial Information

Audited and interim financial statements of the Target are currently being prepared in accordance with the requirements of the Exchange and are not available at the time of this press release. However, the Corporation will in due course make available to the Exchange, all financial information as required by the Exchange and will provide, in a press release to be disseminated at a later date, summary financial information derived from such statements. In addition, details on the insiders of the resulting issuer, as required by the Exchange, were not available at the time of this press release. The Corporation will provide in a press release to be disseminated at a later date, the details on the insiders of the resulting issuer.

Description of Significant Conditions to Closing

Completion of the Proposed Acquisition is subject to a number of conditions, including, but not limited to the completion of the ON4 Acquisition, Exchange acceptance and the closing of the Private Placement of the Corporation. As the Proposed Acquisition is an arm's length transaction, shareholder approval will not be required. In addition, other necessary conditions to close the Proposed Acquisition include obtaining all other necessary regulatory, and third party approvals and authorizations, the completion of a definitive agreement setting forth the terms and conditions set forth in the Agreement, the concurrent completion of the Private Placement referred to herein and the completion of due diligence. There can be no assurance that the Proposed Acquisition will be completed as proposed or at all.

Investors are cautioned that, except as disclosed in the filing statement to be prepared in connection with the Proposed Acquisition, 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.

In accordance with Exchange policy, the Corporation's shares are currently halted from trading and will remain halted until further notice.

Cautionary Statements

This news release contains "forward-looking statements" within the meaning of applicable securities laws relating to the proposal to complete the Proposed Acquisition and associated transactions, including statements regarding the terms and conditions of the Proposed Acquisition and associated transactions. Readers are cautioned not to place undue reliance on forward-looking statements. 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 Proposed Acquisition and associated transactions, that the ultimate terms of the Proposed Acquisition and associated transactions will differ from those that currently are contemplated, and that the Proposed Acquisition 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 statements in this news 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, DataTrail Inc., or their respective financial or operating results or (as applicable), their securities.

The TSX Venture Exchange, Inc. has in no way passed upon the merits of the Proposed Acquisition and associated transactions and has neither approved nor disapproved of the contents of this press release.

Contact Information

  • Bling Capital Corp.
    Stuart Peterson
    President and Director
    (403) 234-0734
    or
    ON4 Communications Inc.
    Cameron Robb
    Chief Executive Officer
    (480) 284-4260
    or
    DataTrail Inc.
    Patrick Hamilton
    President
    (403) 253-3651