Margaux Red Capital Inc.
TSX VENTURE : MXC.P

December 24, 2013 09:14 ET

Margaux Red Capital Inc. Announces Qualifying Transaction

VANCOUVER, BRITISH COLUMBIA--(Marketwired - Dec. 24, 2013) - Margaux Red Capital Inc. ("Margaux" or the "Company")(TSX VENTURE:MXC.P), a capital pool company pursuant to Policy 2.4 of the TSX Venture Exchange (the "TSX-V"), has entered into a letter of intent dated December 17, 2013 (the "LOI") with Upriver Aquaculture Inc. ("UPRIVER"), a private Texas company, to acquire all of the issued and outstanding shares of Upriver (the "Transaction"). The Transaction will constitute Margaux's "Qualifying Transaction" under the applicable policies of the TSX-V.

About the Transaction

Pursuant to the terms of the LOI, subject to execution of a definitive acquisition agreement and receipt of applicable regulatory and TSX-V approvals, Margaux will issue 12,000,000 common shares to acquire all of the issued and outstanding securities of UPRIVER or complete some other form of acquisition which has the same effect. There are currently 4,000,000 shares of Margaux issued and outstanding, as well as a total of 550,000 options and warrants exercisable at $0.10. Prior to completion of the Transaction, Margaux will proceed with a reverse split of its shares on the basis of two (2) old shares for one (1) new share resulting in an aggregate of 2,000,000 shares. Current holders of Margaux shares will hold approximately 14.3% of the Margaux shares and current holders of UPRIVER shares will hold approximately 85.7% of Margaux shares issued and outstanding before giving effect to the private placement described below.

For the following three years after the completion of the Transaction, 1,750,000 bonus shares of Margaux may be issued per year, for a total of up to 5,250,000 shares to UPRIVER if certain sales objectives are met.

Margaux has also agreed, under the terms of the LOI, to advance $15,000 to UPRIVER.

The Transaction is not a "non-arm's length transaction" as defined by TSX-V policies. Upon completion of the proposed transaction, Margaux will be listed on the TSX-V under the name Upriver Aquaculture Inc. or such other name as is acceptable to the board and the TSX-V.

Financing

Subject to completion of the Transaction, Margaux will be raising a minimum of $875,000 by way of a non-brokered private placement by the issuance of 3,500,000 units at a price of $0.25 per unit. Each unit will consist of one common share and one share purchase warrant. Each warrant will entitle the holder to purchase one common share at $0.40 per share at any time until the close of business on the day which is 36 months from the date of the issue of the warrant.

Finders' fees may be paid in connection with the non-brokered private placement in accordance with TSX-V policies.

Significant Closing Conditions

Closing and final acceptance of the Transaction are subject to the satisfaction of certain conditions, including the completion of satisfactory due diligence, the execution of a definitive amalgamation agreement, approval by the shareholders of Margaux and UPRIVER if required, completion of the financing and approval by the TSX-V and all other regulatory bodies. There can be no assurance that the Qualifying Transaction will be completed as proposed or at all.

Board of Directors and Insiders following completion of the Transaction

Richard Gil Tubb, President and Chief Executive Officer, Director

Mr. Tubb is a successful entrepreneur with over 40 years of experience in sales, marketing, and management. He has started and managed numerous private operating and investment companies. As CEO of Upriver, he is responsible for the overall direction, management and operation of the business.

Kevin Harrington, Director

Mr. Harrington has been in the Direct Response business for over 25 years and has long been acknowledged as the pioneer and principal architect of the "infomercial" industry. Mr. Harrington has launched over 500 products, resulting in $4 billion in sales and 20 products that reached individual sales of over $100 million. He was a member of the investor panel for the hit show "Shark Tank" on ABC and is the author of "Act Now: How I Turn Ideas into Million-Dollar Products." Mr. Harrington founded Quantum International, Ltd. in the mid 1980s, which merged into National Media Corporation in 1991. As President, National Media reached $500 million in annual sales, distributing in over 100 countries and 20 languages. Mr. Harrington was also CEO of several other entrepreneurial companies including HSN Direct, a joint venture with Home Shopping Network, and Reliant International Media. He is also the founder of the Entrepreneur's Organization and the Electronic Retailing Association.

Jean Jean Pelletier, Director

Jean-Jean Pelletier brings more than 20 years of experience in all aspects of sales and marketing, public relations, corporate finance including strategic advisory services for mergers & acquisitions, private and public capital raising. Mr. Pelletier is the founder and president of JJ's Capital LLC, an advisory firm for small cap corporations which he launched in 2010. He is the co-founder of WaterBank of America (USA) Inc., Global Water Asset, a spring water company in Canada, Cangreengo Agriculture Corp., an agriculture company in Canada and Latin America as well as Beyond Gold Corp. Mr Pelletier holds a bachelor degree in political science from the University of Montreal.

Robert P. Pelletier, Director

Robert Pelletier has been in the marketing and finance industries for over 15 years. He is also a co-founder of WaterBank of America (USA) Inc., North American Spring Water, Chase Communication Network and Talent Corp. Mr. Pelletier is also the president and co-founder of Tupella Aquaculture Group. Mr Pelletier is the founder of www.RPP Blue.com Inc., a corporate image consulting firm. He acted as marketing consultant for such companies as Lise Watier Cosmetics Group, Talent Corporation, Ocean Drive Magazine, Gianni Versace, Pennsylvania Ave and Tosca.

Steve Bajic, Director

Since 1996, Mr. Bajic has been the president of Hexagon Ventures Inc., a company providing financial and business services consulting to private and publicly listed companies. Mr. Bajic has previously held numerous public company director and/or officers positions and is currently a director, President and CEO of Patriot Petroleum Corp., an oil and gas exploration and production company, and a director of Providence Resources Corp. and Bethpage Capital Corp., both of which are resource exploration companies. All of these companies are listed on th TSX-Venture Exchange. He has been in the finance industry for over 19 years and has helped raise capital in various industries in all levels of company advancement. Mr. Bajic holds a Financial Management Diploma from the British Columbia Institute of Technology.

Michel Lebeuf Jr., Corporate Secretary

Mr. Lebeuf is partner in the law firm Briere & Lebeuf and has developed a legal practice focused on securities, institutional financing, corporate finance, as well as public and private mergers ad acquisitions. He represents public corporations, securities brokers, purchasers, sellers, bankers and financial advisors. He provides strategic advice with respect to access to public capital markets and securities matters, including structured products. He acted as counsel to international dealers in several offerings in the Eurobond International debt market. Mr. Lebeuf also represented public and private corporations in various mergers and acquisitions. He acts for issuers and underwriters in the context of public offerings and private placements in Canada, Europe, South America and North Africa. He regularly provides counsel to financial institutions regarding security requirements and the drafting of documents pertaining to enforcement proceedings. Mr. Lebeuf holds a bachelor of law degree from the University of Montreal.

Sponsorship

The Qualifying Transaction will be subject to the Exchange Policy 2.2 on sponsorship and its requirements. Margaux has retained Jones, Gable & Company Limited to act as sponsor for the Transaction. An agreement to sponsor should not be construed as any assurance with respect to the merits of the Qualifying Transaction or the likelihood of completion.

Proposed Finder's fee

Upon closing of the Transaction, Margaux shall pay a finders' fee of 160,000 shares and $40,000 to MediaPark AG.

About Upriver Aquaculture Inc.

Based in Miami, Florida, UPRIVER is a privately held corporation incorporated under the laws of Texas and controlled by Richard Gil Tubb and was founded in 2009. Its activities consist of the production and sale of various seafood products but specializing in traditionally smoked salmon. UPRIVER currently produces its own line of gourmet products in addition to processing and private labeling for several major brands. Upriver operations include full production services: custom smoking, partitioning, vacuumed packaging and repacking.

UPRIVER seeks to become a leader in the smoked salmon production and distribution industry in the eastern United States and Caribbean with expansion goals of market penetration in the rest of the United States and Internationally. UPRIVER's intends to expand the direct to consumer reach via various channels of distribution on television, on-line, and in traditional retail stores with the addition of key personnel having extensive experience in these areas, an injection of investment capital, and more aggressive marketing campaign.In addition, UPRIVER has developed privileged relationships with celebrity chefs and spokespersons to represent the brand.

The common shares of Margaux will remain halted until such time as the TSX-V provides its permission to resume trading. Financial information on Upriver will be provided in a subsequent news release or disclosure document prior to a resumption of trading.

Investors are cautioned that, except as disclosed in the management information circular of filing statement to be prepared in connection with the Transaction, any information released or received with respect to the Transaction may not be accuratre or complete and should not be relied upon. Trading in the securities of a capital pool company should be considered highly speculative.

The TSX-V has in no way passed upon the merits of the proposed transaction and has neither approved nor disappoved the contents of this press release.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term in defined in the policies of the TSX Venture Exchange) accepts responsibility for the accuracy or adequacy of this release.

Contact Information

  • Steve Bajic
    President
    (604) 628-5614
    (604) 662-7950 (FAX)