Powerstar International Inc.

April 26, 2007 10:52 ET

Powerstar International Inc. Announces Completion of Qualifying Transaction With Solutrea Inc.

CALGARY, ALBERTA--(CCNMatthews - April 26, 2007) -


Powerstar International Inc. (TSX VENTURE:PWS) ("Powerstar") is pleased to announce that it has received all required regulatory approval and has completed its Qualifying Transaction with Solutrea Inc. ("Solutrea").

Powerstar had previously announced in its press release of November 28, 2006 that it had entered into a letter agreement dated September 8, 2006, as amended by a further letter agreement dated October 26, 2006 with Solutrea respecting a proposed business combination between the two corporations. On April 5, 2007 Powerstar filed a filing statement describing the terms of the transaction with the securities regulatory authorities in the Provinces of Alberta, British Columbia and Ontario and with the TSX Venture Exchange. The filing statement can be accessed on Powerstars internet profile on SEDAR at www.sedar.com. The transaction, which was negotiated at arm's length, was effected by way of an exempt take-over bid whereby Powerstar acquired all of Solutrea's issued and outstanding common shares in exchange for an aggregate of 19,552,744 common shares of Powerstar. Each Solutrea shareholder received 169,537.36 Powerstar common shares for each Solutrea share held.

With the completion of the transaction, the total number of shares outstanding in Powerstar is 31,338,455 common shares. Of these shares, an aggregate of 2,575,000 Powerstar common shares are held in escrow pursuant to an escrow agreement dated July 6, 2005 between Powerstar, Computershare Trust Company of Canada and certain shareholders of Powerstar. These shares were placed in escrow in connection with the initial public offering of Powerstar. In addition, 14,632,770 Powerstar common shares issued to Solutrea shareholders in connection with the transaction are held in escrow pursuant to a TSX Venture Exchange Tier 2 Surplus Security Escrow Agreement and 4,919,974 Powerstar common shares issued to Solutrea shareholders are held in escrow pursuant to a TSX Venture Exchange Tier 2 Value Security Escrow Agreement. Both of these agreements were entered into concurrently with closing of the transaction. In addition, of the 19,552,744 of the Powerstar common shares issued to Solutrea shareholders, 5,500,000 of these shares are subject to a performance escrow as further described in the filing statement.

Powerstar also issued 300,000 common shares to an individual as a finder's fee in connection with the transaction and 300,000 warrants to acquire Powerstar common shares were issued to Haywood Securities, as sponsor, as part of its advisory fee. In connection with closing of the transaction, Powerstar also issued 1,443,824 options to purchase Powerstar common shares to directors, officers, employees and consultants at $0.20 per share exercisable for a period of 5 years.

Powerstar will now carry on the business of Solutrea, offering integrated digital communications services to businesses, such as digital signage, satellite services, business television, WiFi (hot spots), WiMAX and PC games. Solutrea is primarily a US company; however, the company anticipates conducting business in Canada, Central America and Europe in the future. Powerstar plans to generate revenue in the short term by continuing to sell satellite and business TV services. In the medium term, Powerstar expects to generate advertising revenue from digital signage. Powerstar is planning to be an operator of WiFi hot spots around the globe. Powerstar plans to become a leading competitive broadband data services provider to businesses and consumers by providing a unique set of value added services to its clients that save money and even generate revenue for its clients.

Powerstar is pleased to announce a new management team and board of directors.

Hatim Zaghloul -Chairman of the Board, Chief Executive Officer and Director

Dr. Zaghloul, is currently the Chairman of Solutrea Inc. Dr. Zaghloul co-founded Wi-LAN Inc. (TSX: WIN) and Cell-Loc Inc. (TSV:LTI). Dr. Zaghloul co-invented wideband orthogonal frequency division multiplexing (WOFDM) and multicode direct sequence spread spectrum (MCDSSS). WOFDM is now the foundation of most high speed wireless communications standards including WiFi, and WiMAX. MCDSSS is the distinguishing feature of CDMAOne, CDMA2000 and WCDMA . Dr. Zaghloul is the first inductee to the Broadband Wireless Hall of Fame. Dr. Zaghloul is currently the Chairman of the Board of Wi-LAN Inc., and the CEO and Chairman of Innovative Products for Life Inc.. Dr. Zaghloul holds a B.Sc. in Electrical Engineering from Cairo University and a M.Sc. and a Ph.D. in Physics from the University of Calgary.

David Lauterbach -Director of Powerstar and President of Solutrea Inc.

Mr. Lauterbach is co-founder and President of Solutrea Inc., overseeing operations and development worldwide. Mr. Lauterbach's expertise and vision for the integration of digital communications networks for the business and retail environment provides the backbone of Solutrea's market strategy and success. Mr. Lauterbach previously served as the Director of Technical Operations at Loral Skynet. Mr. Lauterbach led the team that created some of the first satellite IP video multicast networks, led all BTV engineering and continues to lead pioneering efforts in these areas. At Global Access, Mr. Lauterbach's engineering teams were responsible for the development of the first system that was able to broadcast MPEG II video over standard T1 telephone lines, significantly reducing the cost of broadcast production. Prior to this, Mr. Lauterbach was part of the founding management team of the Business Television Group at EchoStar Communications, a key member of the engineering team that did much of the pioneering work on the DVB MPEG II platform and was part of the engineering/design team that built EchoStar's core Cheyenne Uplink center. Mr. Lauterbach has played key roles in various organizations and charities, including serving on the advisory board to Denver Technical University. Mr. Lauterbach received his Bachelor of Science degree from the University of South Florida.

Lawrence Podrasky - Chief Financial Officer

Mr. Podrasky, has recently been Chief Financial Officer for two publicly-listed resources companies. He previously held senior management roles in the banking sector including Executive Vice President for Bankers Trust responsible for major corporate clients in Asia Pacific, First VP for Credit Lyonnais responsible for project finance lending at head office, and Budget & Accounting Manager for U.S. Leasing. Mr. Podrasky holds a MBA in Finance & Accounting from Cornell University.

Robert Schulz - Director, Chairman of the Audit Committee and member of the Governance Committee

Dr. Schulz, is a Professor of Strategic Management with the Haskayne School of Business at the University of Calgary, where he has taught since 1973. His practical approach has resulted in 20 awards for outstanding teaching, including "top 10" in Canada among 39,000 professors. Dr. Schulz was the first recipient of the Order of the University of Calgary for his service to others. Among his four degrees are an engineering degree from Notre Dame and a PhD in Business from Ohio State. Dr. Schulz has served on many public and private boards, including many years with Wi-LAN Inc. As a consultant, Dr. Schulz has facilitated the strategic planning for numerous public and private companies and animated more than 1,300 workshops and presentations. Dr. Schulz is the co-author of the book, Corporate Integrity: A Toolkit for Managing Beyond Compliance (Wiley, 2005). Dr. Schulz holds a B.A. from St. Vincent College, a B.S.M.E. from the University of Notre Dame, a M.B.A. from the University of Pittsburgh and a Ph.D. from the Ohio State University.

James Skippen - Director and Chairman of the Compensation Committee and member of the Audit Committee

Mr. Skippen is President and Chief Executive Officer of Wi-LAN Inc. and a member of the Board of Directors. Prior to joining Wi-LAN Inc. in June 2006, Mr. Skippen held a number of senior management positions with MOSAID Technologies. In 2003, Mr. Skippen was appointed Senior Vice President, Patent Licensing and General Counsel for MOSAID, and was responsible for managing the company's highly successful patent licensing program. While at MOSAID, he played an integral role in helping the company distinguish itself as an intellectual property powerhouse by leading the effort to license its patent portfolio to many of the world's best known electronics companies and successfully managing many large complex patent litigations. Mr. Skippen has extensive legal experience, having practiced technology law for many years in two of Canada's largest law firms. He is currently a board member of Icron Technologies Inc., a member of the Executive for the Ottawa Technology Law Group and a member of the Licensing Executives Society. He is a former Chairman of the Toronto Computer Lawyers Group and a former Vice-Chairman and Director of the Canadian Diabetes Association. Mr. Skippen is a frequent speaker at conferences and has delivered numerous papers and articles concerning management of intellectual property, patent licensing and technology law.

David E. Prasow Q.C. - Secretary and Director, Chairman of the Governance Committee and member of the Audit Committee and the Compensation Committee

Mr. Prasow, has been President of David E. Prasow Professional Corporation from 1977 to the present and is currently a corporate and commercial lawyer practicing in Calgary, Alberta with an association of independent law practices under the name Spier Harben. Mr. Prasow has over 30 years practice experience in the fields of corporate, commercial and business law. Mr. Prasow is currently the Secretary and a director of Powerstar and is a past Chief Financial Officer, Treasurer, Secretary and Director of GRD Enterprises Inc. (now Call Genie Inc.), a junior technology issuer listed on the Exchange; a past Secretary and Director of IMS Petroleum Inc. (now Pocaterra Energy Inc.), a junior oil and gas issuer listed on the Exchange; and past Secretary and Director of Tarasol Ventures Inc., listed on the former Alberta Stock Exchange. Mr. Prasow holds a B.A. from the University of Calgary and an L.L.B. from the University of Alberta.

Forward Looking Information

Certain statements in this release, other than statements of historical fact, may include forward-looking information that involves various risks and uncertainties. There can be no assurance that such forward-looking statements will prove to be accurate. Actual result and future events could differ materially from those anticipated in such statements. These and all subsequent written and oral forward-looking statements are based on the estimates and opinions of management on the dates they are made and expressly qualified in their entirety by this notice. Powerstar assumes no obligation to update forward-looking statements should circumstances or management's estimates or opinions change, other than as required pursuant to applicable securities laws.

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy of this press release.

Contact Information

  • Powerstar International Inc.
    Hatim Zaghloul
    Chairman and Chief Executive Officer
    (403) 285-0223
    (403) 285-0226 (FAX)
    Email: HZaghloul@solutrea.com