Montreux Capital Corp.

May 01, 2012 19:08 ET

Montreux Capital Corp. Proposed Acquisition of Kowops eCommunity Solutions Phils and Certain Assets of Kowops eCommunity Solutions Inc.

VANCOUVER, BRITISH COLUMBIA--(Marketwire - May 1, 2012) - Montreux Capital Corp. (TSX VENTURE:MRX.H) (the "Company") reports that it has negotiated the general terms of a purchase letter agreement (the "Agreement") dated April 26, 2012, to acquire certain assets of Kowops eCommunity Solutions Inc. ("Kowops") and to own not less than 97.33% of the issued and outstanding shares of Kowops eCommunity Solutions Phils Inc. (Kowops Phils) of the Philippines by the Company subscribing for new shares in Kowops Phils (collectively the "Proposed Transaction"). Pursuant to the policies of the TSX Venture Exchange (the "Exchange"), trading in the Company's shares has been halted pending this announcement. The Proposed Transaction is intended to be the Company's Qualifying Transaction ("QT") under Exchange Policy 2.4.

Kowops is a private British Columbia banking software company with proprietary banking solutions for use in emerging markets. Kowops Phils is a private Philippine banking software service company that has in place numerous contractual relationships with local financial institutions currently using the proprietary software of Kowops.

The Proposed Transaction

It is intended that the Company will acquire from Kowops certain proprietary banking software technology, including sources codes and executable programs for money remittances and for a cooperative bank accounting system known as Integrated Credit Union Resources Management (collectively the "Software"). The Company will also subscribe for sufficient shares in Kowops Phils to own not less than 97.33% of all of the issued and outstanding shares of Kowops Phils (the "Interest").

To acquire the Software and Interest, the Company will be issuing to Kowops common shares in its capital stock (the "Payment Shares") and pay a subscription fee (the "Subscription Payment") to Kowops Phils, respectively. The exact number of Payment Shares to be issued by the Company and the amount of the Subscription Payment will be determined once due diligence has been concluded.

Certain of the Payment Shares may be subject to escrow requirements and all will be subject to a four (4) month hold period imposed by the Securities Act (British Columbia).

In addition it is anticipated that prior to the closing of the Proposed Transaction (the "Closing"), the Company will complete a private placement (the "Private Placement") of its securities for an amount and on terms mutually acceptable to Kowops and the Company. All securities issued by the Company pursuant to the Private Placement, will be subject to a four (4) month hold period imposed by the Securities Act (British Columbia). The Company reserves the right to pay finder`s fees in cash and/or securities of the Company to qualified arm's length parties in connection with the Private Placement.

The Agreement was negotiated at arm's length.

About Kowops and Kowops Phils

Kowops is a private, British Columbia bank software company which has been in business since 2009. Kowops has two (2) shareholders with holdings in excess of 10% of its total issued and outstanding share capital, those being Edgar Quinto (19.8%) and Romeo V. Villaneva (11.2%).

The Software enables individuals, micro, small and medium-sized enterprises and customers of alternative finance institutions ("AFIs") in emerging markets to be served with cost-effective e-commerce and electronic financial services. The Software will be distributed to the AFIs in developing countries under a free licensing agreement which then serves as a platform for revenue generation in the services it enables.

The current market for Kowops' Software is the Philippines where Kowops Phils has operations, software licensing agreements with more than 100 credit cooperatives and relationships with many others.

Kowops Phils, installs and services Kowop's Software to local credit cooperatives in the Philippines for a nominal monthly maintenance fee. The Software will support mobile payments (SMS text message payments), as well as money remittances and certain on line banking functions. Once development is completed, the mobile payment platform will allow for goods and services to be paid for via SMS text messages from a cell phone.

AFIs are alternative financial institutions including Credit Cooperatives (Credit Unions), and member-owned financial institutions that provide traditional banking, funds transfer and payment services that are not available in large, remote communities not served by commercial banks. The AFIs in the Philippines are duly registered with the Philippine government's Cooperative Development Authority, which is mandated to regulate and monitor the activities of its registrants.

Kowops and Kowops Phils have not generated any significant revenues to date.

Terms of the Proposed Transaction

The purchase of the Software and the Interest by the Company is subject to, among other things, the following conditions precedent:

(1) the completion of due diligence, to the satisfaction of the Company, with respect to Kowops, and Kowops Phils which due diligence must be completed no later than May 31, 2012;
(2) each of the Kowops, Kowops Phils and the Company obtaining by May 31, 2012 the approval of its respective boards of directors for the Proposed Transaction;
(3) the tendering of resignations at Closing of all but two of the Company's current directors and one of its officers and the appointment of Kowops' and Kowops Phils replacement representatives to the Company's board of directors and the appointment of replacement officers;
(4) mutual agreement on the amount and terms of the proposed Private Placement and the successful closing of same;
(5) if required, the passing of resolutions by the shareholders of the Company approving the Proposed Transaction contemplated hereby; and
(6) receipt of written notice from the Exchange that it has approved the Proposed Transaction and the Private Placement.

Upon satisfactory completion of legal, financial and technical due diligence, the Company will finalize and enter into a definitive agreement with Kowops and Kowops Phils at which time more particulars of the Proposed Transaction will be disclosed including the number of Payment Shares to be issued to Kowops, the amount of the Subscription Payment, the Private Placement, and certain financial information of Kowops and Kowops Phils.

Changes in Management

It is proposed that Messrs. David Thomas and Philip Pincus, founder of the Company and CFO respectively, will remain on the Company's board and Messrs. Edgar Quinto, Romeo Villanueva, and Jose Apeles will be appointed as Officers and to the Company's Board of Directors in place of other current board members and officers.

The following provides information regarding the members of the Company's proposed Board of Directors and new Officers:

Edgar Quinto - Proposed President and CEO

Mr. Quinto, age 64, is the CEO of Kowops. Mr. Quinto has more than 30 years experience as member of the board of directors and senior manager for a large Philippine conglomerate with more than 16,000 employees that is engaged in banking, finance, insurance, international trade, and manufacturing. Mr Quinto is the creator of the Kowops business model, which he developed by leveraging the proprietary cooperative banking and payment technologies of Kowops, which empowers the Credit Unions to compete in the acquisition of members and deposits, and promotes the social and economic opportunities in the underserved communities in the developing and least developed countries.

Mr. Quinto graduated from San Beda College in the Philippines with a Bachelor of Science degree in Business Administration. He was a member of Team Canada that consisted of CEOs of Canadian corporations that accompanied the Prime Minister in Trade Missions in the latter part of 1990. Mr. Quinto is a Canadian citizen and resides in Vancouver, B.C.

Romeo V. Villaneva - Proposed Chairman

Romeo V. Villanueva, age 65, brings his management skills for the last 30 years as the President and CEO of a family-owned successful distribution company of pharmaceutical products and medical equipment based in San Diego, California. Prior to his migration in the United States, he managed a family-owned 100-room hotel and convention center located in the summer capital of the Philippines. He also owned and operated a company that undertook the construction of roads, bridges and high-rise building contract.

Mr. Villaneva graduated from San Beda College with a degree in Bachelor of Science in Business Administration. Mr. Villaneva is an American citizen and resides in San Diego, California.

Jose Apeles - Proposed Director and CTO

Jose Apeles, age 45, is an Executive Director and the Chief Information and Communications Technology Officer of Kowops. He graduated from the University of Santo Tomas in the Philippines with a Bachelor of Science degree in Electronics and Communications Engineering. He is a licensed electronics and communications engineer in the Philippines. Prior to his migration to Canada, he was a former ICT manager of a multinational Philippine company involved in managing technology solutions and services for the banking, financial, telecommunication and retail industries. Mr. Apeles is a Permanent Resident of Canada and resides in Coquitlam, B.C.

David Thomas - Director

Mr. Thomas, age 50, has been a director and CEO of the Company since September 24, 2007. He has practiced law in British Columbia since May 1989, and has practiced law as David L. Thomas Law Corp. of North Vancouver, BC since November 1994. Mr. Thomas has a LL.B (1988) from Osgoode Hall Law School, York University, Toronto, Ontario, and a BA (1985) from the American College of Switzerland, Leysin, Switzerland. Mr. Thomas resides in West Vancouver, B.C.

Philip Pincus -Director and CFO

Mr. Pincus, age 54, has been a director and CFO of the Company since October 3, 2007. Upon completion of the QT Mr. Pincus will remain as a director and officer. Mr. Pincus has a BS degree (1980) from New York University in New York, New York and was granted a CPA license by the State of New York in November 1982 (currently inactive). Mr. Pincus is an American citizen and has lived in Canada for the past 19 years. Mr. Pincus is currently President of APT Investments Corp of Vancouver BC since July 2009 and previously was Managing Director of Accolade Equities Inc. from July 2005 to July 2009. From February 2003 until April 2005 Mr. Pincus was controller of Quality Move Management, a corporate relocation services company, of Delta, BC. He was self-employed from October 1992 to 2003. Mr. Pincus is a Permanent Resident of Canada and resides in Vancouver, B.C.


The Company will be interviewing brokerage firms to act as sponsor in connection with the Proposed Transaction. An agreement to sponsor should not be construed as any assurance with respect to the merits of the Proposed Transaction or the likelihood of completion.

In accordance with Exchange policy, this Proposed Transaction is the Company's QT and the Company's shares will remain halted pending the Closing or the termination of the Proposed Transaction.

For additional information readers are invited to review additional corporate information available on SEDAR at


David L. Thomas, Chief Executive Office

Completion of the Proposed 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 Proposed Transaction cannot close until the required shareholder approval is obtained. There can be no assurance that the Proposed 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 Proposed 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 news 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 release.

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