Technical Ventures RX Corp.
TSX VENTURE : TIK.P

May 14, 2013 09:15 ET

Technical Ventures Announces Qualifying Transaction

VANCOUVER, BRITISH COLUMBIA--(Marketwired - May 14, 2013) -

NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES.

Technical Ventures RX Corp. (TSX VENTURE:TIK.P) (the "Corporation"), a capital pool company listed on the TSX Venture Exchange, announces it has entered into a Letter of Intent dated for reference April 18, 2013, regarding a proposed transaction (the "Transaction") with TheraVitae Inc. ("TVI"), a privately held company incorporated under the Business Corporations Act (Canada), with offices in Toronto, Canada and Ness Ziona, Israel. TVI operates as a clinical-stage Canadian biotechnology company focused on developing, manufacturing and commercializing blood-derived autologous adult stem cell therapies to treat severe medical disorders.

The Corporation intends that the Transaction will constitute its "Qualifying Transaction" for the purposes of Policy 2.4 of the TSX Venture Exchange Inc. ("Exchange"). Subject to any regulatory, shareholder, director or other approvals that may be required, the completion of satisfactory due diligence by the Corporation and other conditions contained in the Letter of Intent, it is intended that the Corporation will acquire TVI in a reverse takeover transaction which will be effected by way of amalgamation or plan of arrangement. Following completion of the Transaction, it is anticipated the resulting issuer will be classified as a Tier 2 life sciences issuer.

The Transaction

Under the Transaction, the Corporation will acquire 100% of the issued and outstanding common shares of TVI (the "TVI Shares") whereby the holders of TVI Shares will receive common shares of the Corporation in exchange for their TVI Shares. Pursuant to the share exchange, the Corporation shall issue 50,000,000 post-consolidation common shares to the shareholders of TVI at a deemed issue price of $0.50 per common share, for an aggregate purchase price of $25,000,000. Immediately prior to closing the Transaction, the Corporation will complete a share consolidation of its common shares on a one for five basis (the "Consolidation") and a corporate name change to "Hemostemix Ltd. or such other name as TVI and the Corporation may determine (the "Name Change").

In addition, all outstanding stock options to purchase common shares of the Corporation will be exchanged for replacement stock options to purchase resulting issuer shares with the number and exercise prices thereof adjusted to reflect the Consolidation. It also anticipated that at closing the resulting issuer will grant options to acquire resulting issuer shares at a price of $0.50 per share to the new directors, officers, employees and consultants of the resulting issuer. Further details will be provided in a subsequent news release.

About TheraVitae Inc.

TVI conducts operations through its wholly owned subsidiary, Hemostemix Ltd., ("Hemostemix") a company incorporated under the laws of Israel. Hemostemix is a clinical-stage biotechnology company with patented technology focused on developing, manufacturing and commercializing blood-derived autologous cell therapies to treat severe medical disorders. Hemostemix's technology platform, with the potential to generate distinct therapeutic products to treat multiple types of indications, was granted the Technology Pioneer Award by the World Economic Forum in 2006. Hemostemix develops cell therapy products from the patient's own blood, a relatively low-risk, cost-effective and non-invasive source of therapeutic cells. In late 2012, Hemostemix received regulatory clearance from Health Canada to initiate a Phase 2 clinical study in Canada for patients with critical limb ischemia.

Hemotemix's objective is to initially focus on the development of a treatment for critical limb ischemia ("CLI") in addition to the co-development of cell-based therapies for other indications. CLI is an unmet medical need caused by inadequate blood supply to the limbs and it affects more than 1 million people in the U.S. and more than 3 million people in Europe. Hemostemix's cell therapy has the potential to revolutionize CLI treatment.

TVI currently has 459,054,482 common shares outstanding, which, after giving effect to the TVI Offering, as defined herein, will increase to approximately 479,054,482, will be exchanged for 50,000,000 common shares of the Corporation as described above. When a definitive agreement between the Corporation and TVI is executed, which is anticipated shortly, in accordance with the policies of the Exchange, the Corporation will issue a subsequent news release containing the details relating to sponsorship and summary financial information in respect of TVI.

Proposed Offerings

TVI has engaged Wolverton Securities Ltd. as agent (the "Agent") for a private placement offering, on a commercially reasonable efforts basis, of a minimum of 20,000,000 TVI Shares at a pre-transaction price of $0.05 per TVI Share, for minimum gross proceeds of $1,000,000 (the "TVI Offering"). The proceeds from the TVI Offering will be used to finalize the planning and implementation of Hemostemix's Phase 2 clinical study in Canada and for general working capital requirements. The TVI Offering is expected to close concurrently with the execution of the definitive agreement between the Corporation and TVI. The Agent will be entitled to a commission of up to 8.0% of the gross proceeds raised under the TVI Offering which may be paid, at the election of the Agent, in cash or common shares (each common share with a deemed price of $0.05 per common share) and the Agent will also be entitled to options (the "Agent's Options") equal to up to 8.0% of the number of common shares issued under the Offering, with each Agent's Option exercisable at $0.05 for 60 months from the date the completion the Transaction. In addition, the Agent will receive a corporate finance fee in connection with the TVI Offering.

Further details regarding the TVI Offering will be provided in a subsequent news release.

Insiders and Board of Directors of the Resulting Issuer

The current directors and officers of the Corporation will resign and be replaced by the existing management team and board of directors of TVI, who collectively possess many years of business and life science industry experience. The following is a description of the proposed directors and officers of the resulting issuer.

Bill Baker - Armstrong, British Columbia - Proposed Chairman and Director of the Resulting Issuer

Mr. Baker is currently the Executive Chairman and a Director of TVI. Mr. Baker has over 40 years of senior management experience and has served on the board of directors of several public companies, including Butte Energy Inc., Circle Energy Inc., Early Resources Ltd., and Scarlet Exploration Inc. Mr. Baker is a founding shareholder of TVI and has been in executive management of TVI since 2010.

Dr. Valentin Fulga - Toronto, Ontario - Proposed President, Chief Executive Officer, and Director of the Resulting Issuer

Dr. Fulga is currently the President and Director of TVI. Dr. Fulga is a serial entrepreneur with 20 years of experience in the biopharmaceutical industry, primarily the cell therapy sector. He founded and has held senior executive positions previously with Riolan Ophthalmics, Theravitae, and Proneuron Biotechnologies. Dr. Fulga is the inventor of the technology for which he was granted the Technology Pioneer Award by the World Economic Forum. Dr. Fulga is the inventor of more than 10 patents and the author of many scientific and medical articles, has given numerous presentations at medical, scientific and business meetings and has been interviewed by many prestigious journals and electronic media, such as Time Magazine, Red Herring, and Sixty Minutes.

David Eldar - Jerusalem, Israel - Proposed Chief Financial Officer of the Resulting Issuer

Mr. Eldar has over 15 years experience in high-tech and biotech companies. Previously, Mr. Eldar served as Chief Financial Officer of Proficiency Inc., and Vice President, Finance & Administration of IDgene Pharmaceuticals Ltd. Mr. Eldar also served as controller and internal auditor at AVX Israel. Since 2010, Mr. Eldar he has been Chief Financial Officer for Peregrine Ventures Inc., an Israeli venture capital fund. Mr. Eldar holds a Bachelor of Business at the Academic Studies of the College of Management in Tel Aviv, and a Certified Public Accountants (CPA) license from the Israeli Ministry of Justice.

Lee Buckler - Vancouver, British Columbia - Proposed Director of the Resulting Issuer

Mr. Buckler is currently a Director of TVI. Mr. Buckler was the founder and managing director of Cell Therapy Group, a leading boutique consultancy focused on the cell therapy and regenerative medicine industry. Mr. Buckler's expertise includes competitive intelligence, market research and analysis, strategic development and communications. Mr. Buckler has held senior roles at Progenitor Cell Therapy, Stem Cell Technologies, and the International Society for Cell Therapy.

Roger Bergersen - Palm Springs, California - Proposed Director of the Resulting Issuer

Mr. Bergersen is currently a Director of TVI. Mr. Bergersen is the 35th patient to be treated with TVI's ACP-01 and has celebrated the 7th year following his stem cell treatment. Initially trained with Merrill Lynch in New York, Mr. Bergersen has been involved in the securities industry and the investment banking field since 1968. Mr. Bergersen is a founding shareholder of TVI. Being semi-retired, he works as an independent investment-banking and marketing consultant.

Sponsorship of Qualifying Transaction

Sponsorship of a qualifying transaction of a capital pool company is required by the Exchange unless exempt in accordance with Exchange policies. The Corporation intends to apply for an exemption from the sponsorship requirements. There is no assurance that the Corporation will ultimately obtain an exemption from sponsorship.

Reinstatement to Trading

The common shares will remain halted pending receipt by the Exchange of certain required materials from the Corporation until the Corporation engages a sponsor or a sponsorship exemption is granted. The Corporation will issue a further press release when further updates on these items are available.

Additional Information and Description of Significant Conditions to Closing

The Transaction will be carried out by parties dealing at arm's length to one another and therefore will not be considered to be a Non-Arm's Length Qualifying Transaction, as such term is defined under the policies of the Exchange.

A filing statement or information circular in respect of the Transaction will be prepared and filed in accordance with Policy 2.4 of the Exchange. A press release will be issued once the filing statement or information circular has been filed or mailed to shareholders, as the case may be, as required pursuant to Exchange policies.

Completion of the Transaction is subject to a number of conditions including, but not limited to, the closing of the TVI Offering, the satisfaction of the Corporation and of TVI in respect of certain due diligence investigations to be undertaken by each party, the completion of the Consolidation and Name Change, the completion of a definitive agreement setting forth the terms and conditions set out in the Letter of Intent, closing conditions customary to transactions of the nature of the Transaction, Exchange acceptance, and shareholder approval in accordance with applicable corporate law. The Transaction cannot close until the required shareholder approval is obtained and there can be no assurance that the Transaction will be completed as proposed or at all.

When a definitive agreement between the Corporation and TVI is executed, which is expected to occur shortly, in accordance with the policies of the Exchange, the Corporation will issue a subsequent press release containing the details of the definitive agreement and additional terms of the Transaction, including information relating to sponsorship, summary financial information in respect of TVI's assets, and to the extent not contained in this press release, additional information with respect to the TVI Offering, history of the assets, and further information regarding potential appointments of additional directors and officers upon completion of the Transaction.

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 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.

THIS PRESS RELEASE, PROVIDED PURSUANT TO APPLICABLE CANADIAN REQUIREMENTS, IS NOT FOR DISTRIBUTION TO U.S. NEWS SERVICES OR FOR DISSEMINATION IN THE UNITED STATES, AND DOES NOT CONSTITUTE AN OFFER OF THE SECURITIES DESCRIBED HEREIN. THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAWS, AND MAY NOT BE OFFERED OR SOLD IN THE UNITED STATES OR TO U.S. PERSONS ABSENT REGISTRATION OR APPLICABLE EXEMPTION FROM REGISTRATION REQUIREMENTS.

Cautionary and Forward-Looking Statements

This news release contains forwardlooking statements and forwardlooking information within the meaning of applicable securities laws. These statements relate to future events or future performance. All statements other than statements of historical fact may be forwardlooking statements or information. Forwardlooking statements and information are often, but not always, identified by the use of words such as "appear", "seek", "anticipate", "plan", "continue", "estimate", "approximate", "expect", "may", "will", "project", "predict", "potential", "targeting", "intend", "could", "might", "should", "believe", "would" and similar expressions.

More particularly and without limitation, this news release contains forwardlooking statements and information concerning the expected results of the Transaction; anticipated closing dates of the Transaction; the closing of the Offering and the anticipated timing thereof and the expected use of proceeds from the Offering. The forwardlooking statements and information are based on certain key expectations and assumptions made by management of the Corporation, including project development and overall business strategy. Although management of the Corporation believes that the expectations and assumptions on which such forward looking statements and information are based are reasonable, undue reliance should not be placed on the forwardlooking statements and information since no assurance can be given that they will prove to be correct.

Forward-looking statements and information are provided for the purpose of providing information about the current expectations and plans of management of the Corporation relating to the future. Readers are cautioned that reliance on such statements and information may not be appropriate for other purposes, such as making investment decisions. Since forwardlooking statements and information address future events and conditions, by their very nature they involve inherent risks and uncertainties. Actual results could differ materially from those currently anticipated due to a number of factors and risks. These include, but are not limited to, the risks associated with the stem cell industry in general such as operational risks in clinical trials; competition; incorrect assessment of the value of acquisitions and failure to realize the anticipated benefits of acquisitions; ability to access sufficient capital from internal and external sources; failure to obtain required regulatory and other approvals and changes in legislation, including but not limited to tax laws and government regulations. Accordingly, readers should not place undue reliance on the forwardlooking statements, timelines and information contained in this news release. Readers are cautioned that the foregoing list of factors is not exhaustive.

The forward‐looking statements and information contained in this news release are made as of the date hereof and no undertaking is given to update publicly or revise any forward‐looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws or the TSX Venture Exchange. The forward-looking statements or information contained in this news release are expressly qualified by this cautionary statement.

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.

Contact Information

  • Technical Ventures RX Corp.
    David Wood
    President
    (604) 720-7307