Sceptre Ventures Announces Signing of Term Sheet with IZON Network Inc. for Proposed Qualifying Transaction
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Vancouver, BC – The Newswire – January 9, 2020: Sceptre Ventures Inc. (the “Company”) (TSXV:SVP.H) is pleased to announce it has entered into a non-binding term sheet December 23, 2019 (the “Term Sheet”) with IZON Network Inc. (OTC: IZNN), also known as IZON Digital Media Network (“IZON”) pursuant to which Sceptre proposes to acquire a 100% interest in IZON. IZON creates proprietary media & entertainment platforms for premium & niche marketplaces which reach digital out-of-home audiences.
“Sceptre is very pleased with the signing of the Term Sheet with IZON for both parties’ benefit. After looking at multiple opportunities in which to utilize our CPC it became apparent that IZON Digital Media Network was a growth trajectory company that we wanted to partner and do a transaction with. We are looking forward to finalizing the qualifying transaction and years of success for IZON.” said Mitchell Smith, President and CEO, Sceptre Ventures Inc.
Sceptre is a “capital pool company” under the policies of the TSX Venture Exchange (the “Exchange”). The acquisition of IZON will constitute Sceptre’s “qualifying transaction” under the policies of the Exchange (the “Qualifying Transaction”). Upon completion of the Qualifying Transaction, Sceptre will be listed as a Tier 2 Technology Issuer pursuant to the initial listing requirements of the Exchange.
The Qualifying Transaction is not a Non-Arm’s Length Qualifying Transaction as defined under the policies of the Exchange, and approval from the shareholders of Sceptre is not required.
The Qualifying Transaction
Pursuant to the terms of the Term Sheet, it is expected that Sceptre and IZON will negotiate and enter into a definitive agreement incorporating the principal terms of the Term Sheet.
Subject to any Exchange, regulatory, or other approvals that may be required, the completion of satisfactory due diligence by Sceptre and IZON, the completion of the IZON Financing (as described below) and the satisfaction of other conditions contained within the Term Sheet, it is currently anticipated that as consideration for the acquisition of all of the outstanding securities of IZON, holders of issued and outstanding common shares of IZON will receive, based on an exchange ratio, Sceptre common shares for each IZON common share (the “Exchange Ratio”) based on a Pre-Qualified Transaction valuation of $1 million for Sceptre inclusive of debt and liabilities and $15 million for IZON exclusive of the IZON Financing, and as such IZON shareholders will receive 15 shares of Sceptre for every share of IZON held. The final structure of the Qualifying Transaction is subject to the receipt of tax, corporate and securities law advice for both Sceptre and IZON.
IZON is a reporting issuer in British Columbia and a publicly traded issuer on the OTC Markets. As such, it does not have a controlling shareholder.
Sceptre currently has 20,808,344 shares issued and outstanding and has existing shareholder approval to complete a share consolidation on the basis of one (1) new share for every three (3) shares held (the “Consolidation”).
Upon the Consolidation, Sceptre shall have 6,936,115 shares issued and outstanding.
Prior to completion of the private placement and prior to closing, IZON shall complete a share consolidation of 50 old shares for one new share as announced by IZON on August 13, 2019, resulting in the following securities issued and outstanding: (i) 4,936,606 common shares, (ii) 18,829,231 common shares attributable to the conversion of all convertible preferred and convertible debentures and (iii) 2,255,142 common shares attributable to stock options and warrants.
Pursuant to the transaction, (i) holders of issued and outstanding IZON shares will receive 15 Sceptre shares (post-consolidation) for each IZON share held, (ii) all options, warrants, debentures or other securities convertible into IZON shares shall be exchanged, based on the agreed exchange ratio, for similar securities to purchase Sceptre shares on similar terms and conditions, and (iii) any securities issued pursuant to the private placement will similarly be exchanged (based on the ratio for securities of Sceptre.
Management and Directors of the Resulting Issuer
Upon completion of the Qualifying Transaction, it is currently anticipated that Sceptre’s existing directors and officers will be replaced by the Board and management of IZON.
It is anticipated that the following individuals will be appointed as directors and officers of the Resulting Issuer. In addition, the Resulting Issuer will appoint one additional director and a Chief Financial Officer and a corporate secretary, further details of which will be announced when available.
Giles Somerville, Chairman
Giles Somerville attended Georgetown University, and has over 20 years of experience investing in and directing early stage private companies. Mr. Somerville is a Partner at KG Investments a family office that invests primarily in technology companies via direct investments and secondary loans; notable early stage investments include Facebook, JD.com, Alibaba, Flipkart, Lifelock, Linkedin, Lyft, Unicorn Media, NJOY, Dollar Shave Club and many more. Mr. Somerville is also the Managing Partner at Clearview Investment Partners, which raises institutional capital for niche hedge funds and private equity firms and is an affiliate of Bluesand Securities.
Formerly Mr. Somerville was Managing Partner & Co-Founder of Milestone Equity Partners – one of the most successful accelerator/venture funds of its vintage year 2001. Milestone built a portfolio of over 40 early stage companies; notable companies include: Plaxo, Limelight Networks, Trust Digital, Secure Software, Olive Software, Airdesk. Notable follow on investors in portfolio companies: Sequoia Capital, Kleiner Perkins Caufield & Byers, Goldman Sachs Partner Fund, Oak Ventures, Palo Alto Ventures, Charles River, Harbinger, Globespan, Cisco, Comcast, DAG amongst others.
Mr. Somerville spent the first ten years of his career working with Wall Street firms including Bear Stearns and Paine Webber. Mr. Somerville has extensive public speaking background and has appeared on both FOX News & ABC News multiple times. He splits his time between Scottsdale Arizona and NYC.
Tim Ummel, CEO and Director
Tim Ummel is the CEO of IZON and has a very long history and extensive experience within the domestic and international golf industry as well the advertising world. Tim has over 21 years of experience in the golf, sports and development industries, including the launch of several golf related companies.
Previously, Tim founded and served as a Managing Partner in Innovative Sports Ventures, a boutique venture capital company with an investment focus in the sports, lifestyle and luxury markets. Mr. Ummel has traveled extensively around the globe working on private club and golf developments as well as providing strategic leadership to top sports agencies, overseeing and assisting the portfolios of some of the biggest names in professional golf and baseball. Previous positions included serving as the Vice-President of Business Development at Gaylord Sports Management (now Lagardere Sports & Entertainment), one of the top boutique sports agencies located in Scottsdale, AZ. Gaylord represents numerous professional golfers, baseball players and other athletes. At Gaylord, Tim oversaw all business development and golf course design initiatives, as well as real estate and development projects for clients including Phil Mickelson, Hale Irwin, David Toms, Mark Calcavecchia, Rocco Mediate, Andrew Magee, Dave Pelz, Peter Kostis and Rick Smith. His responsibility included the growth of Gaylord’s consulting division, new client/agency acquisition assessment, and the development of an overall brand and marketing strategy for the firm. He was also intimately involved in the brand identity and launch of new websites for both Phil Mickelson and Hale Irwin.
Prior to Gaylord Sports, Tim was Managing Partner for Cypress Source, LLC, an entity formed to provide guidance, management and support for a newly granted PGA Tour event to be held in Fresno, CA. Tim was responsible for all communication with the PGA Tour concerning the event, as well as interviewing prospective firms to manage the event. Prior to Cypress Source, Tim was a Partner at Copper Advertising, a full-service-advertising agency specializing in advertising, design, public relations and interactive marketing. There he managed clients within the new golf course development, private club and resort sectors for clients across the U.S. & Internationally, including bringing in 12 new golf property accounts. Other career highlights include serving as Founder and CEO of UMLEX Holdings, a full service creative marketing, corporate products and travel services company focused on the golf industry. UMLEX divisions included Nicklaus Golf Photography and Collectibles, as an official licensee of the Jack Nicklaus Companies; Jet Golf, a complete private aircraft, lodging, golf, dining and golf instruction concierge service; and a creative marketing and gift division.
Ummel currently is also the Co-Founder and Managing Partner of TGT Sports Ventures / The GOLF Tank (“Shark Tank” for golf) and currently also serves as the President & COO of Punta Brava Golf & Surf Club, the first Tiger Woods Oceanfront golf design. Called “Augusta for Family” the Wall Street Journal has said “Punta Brava will be a top ten golf course in the world the day it opens”.
Jeff Hosek, President
Jeff Hosek serves as President of IZON Network as well a Member of the Board of Directors with extensive experience running large sales and support organizations selling networks and advertising. Jeff’s previous roles include Director of Support at Global Center and Vice President of Sales & Support of Primenet.
He joined IZON bringing more than 25 years of technology industry leadership, sales and operations, and executive management experience to his role with the company. As an entrepreneur that has worked in the Information Technology and Sales fields, he has held multiple senior management positions with his core experience in managing and growing sales organizations. After attending Penn State University and the Arizona Institute of Business and receiving a degree in accounting, Mr. Hosek became the Senior Director of Sales and Operations for Primenet, an Internet Service Provider. Mr. Hosek helped build and manage the growth in sales from a startup to tens of millions in revenue, when Global Crossing ultimately purchased the company. Hosek remained on as Sr. Director of Sales and lead a team of over 50 direct reports. Subsequently he held a similar position managing a very large team with Frontier Communications. In 2014, Mr. Hosek was tasked with growing Adzzup, Inc, an online marketing agency, which has since helped over 15,000 small businesses across the country build and promote their brands online with annual revenues exceeding $1.6M.
Proposed Financing
In conjunction with, or prior to the closing of the Qualifying Transaction, IZON may complete a private placement of IZON shares (the “IZON Financing”) for gross proceeds of up to $5 million CAD on terms and conditions to be determined, further details of which will be announced when available. In the event that $500,000 of the IZON Financing is not completed by January 31, 2020, Sceptre has the option to terminate the Term Sheet.
Sponsorship of the Qualifying Transaction
Sponsorship of a Qualifying Transaction of a capital pool company is required by the Exchange unless exempt in accordance with Exchange policies. Sceptre is currently reviewing the Exchange’s requirements for sponsorship to determine if it may seek a waiver of the sponsorship requirement.
Additional Information
In accordance with the policies of the Exchange, the Sceptre Shares are currently halted from trading and will remain halted until further notice.
Sceptre and IZON will provide further details in respect of the Qualifying Transaction, in due course once available, by way of press releases including summary financial information in respect of IZON. There can be no assurance that the Qualifying Transaction and the concurrent Financing (as described below) 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 Qualifying Transaction, any information released or received with respect to the Qualifying 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.
About IZON Digital Media Network
IZON is an innovator in creating proprietary media & entertainment platforms for premium & niche marketplaces which reach highly targeted captive digital out-of-home audiences. IZON focuses its efforts on verticals where a premium user base already exists and can be engaged utilizing its digital media network. It’s first solution has been created as the ultimate digital content and GPS platforms for golf. With a rich feature set for the golfer that include IZON Side Games, Tournaments and a proprietary Companion App courses are finding an entirely new way to provide additional value to their customers. At the same time IZON provides the golf course operator an entire Fleet Management, Agronomic and Operational suite of services to manage their course operations. In addition, IZON has created one of the most unique premium outdoor advertising networks as well with its proprietary Ad server, IZON REACH. Recently the newest vertical of focus was announced, IZON Ride. IZON Ride will provide solutions for the consumers inside of premium fleets of rideshare cars, luxury buses and existing black town car & SUV service vehicles. For more information visit www.izonnetwork.com
About Sceptre Ventures Inc.
Sceptre Ventures Inc. is a Capital Pool Company (“CPC”) within the meaning of the policies of the TSX Venture Exchange and has not commenced commercial operations and has no assets other than cash. The Company is currently engaged in identifying and evaluating businesses and assets with a view to completing a Qualifying Transaction under the Exchange’s CPC policy.
For Further Information:
#1501 – 128 West Pender Street
Vancouver, BC, V6B 1R8, Canada
Tel: 604-688-4219 ext. 236 or 237
Email: [email protected]
Forward Looking Statements:
This news release contains certain statements that may be deemed “forward-looking statements. Forward looking statements are statements that are not historical facts and are generally, but not always, identified by the words “expects”, “plans”, “anticipates”, “believes”, “intends”, “estimates”, “projects”, “potential” and similar expressions, or that events or conditions “will”, “would”, “may”, “could” or “should” occur. Although the Company believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results or realities may differ materially from those in forward looking statements. Forward looking statements are based on the beliefs, estimates and opinions of the Company’s management on the date the statements are made. Except as required by law, the Company undertakes no obligation to update these forward-looking statements in the event that management’s beliefs, estimates or opinions, or other factors, should change.
Completion of the Qualifying 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 Qualifying Transaction cannot close until the required shareholder approval is obtained. There can be no assurance that the Qualifying 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 Qualifying Transaction, any information released or received with respect to the Qualifying 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.
A halt in trading shall remain in place until after the Qualifying Transaction is completed or such time that acceptable documentation is filed with the TSX Venture Exchange.
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 press release.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this news release.
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