Stockwatch: Pamerica Corp: Pamerica gets what it wants with LOI to acquire Wanted

Pamerica Corp (TSX-V:PME)
Shares Issued 7,000,000
Last Close PME.P 9/9/2004 $0.35
Friday December 03 2004 - News Release

Mr. Guy Girard reports


Pamerica Corp. has signed a letter of intent with the shareholders of Wanted Technologies Inc., dated Sept. 30, 2004, and has agreed, subject to regulatory and shareholders approvals, to initiate procedures for the conclusion of an arm's-length qualifying transaction in accordance with the policies of the TSX Venture Exchange corporate finance manual. The proposed qualifying transaction consists of the acquisition of all of the issued and outstanding shares of Wanted, a private Canadian company based in Quebec City.

Operating since 1998, Wanted was incorporated under the laws of Canada and specializes in on-demand business intelligence solutions within the media industry. Wanted's vertical search solutions provide companies with the power to create customized sales leads and market monitoring solutions to meet their goals within all classified advertising categories. Wanted's comprehensive family of software and delivery solutions helps customers easily and cost-effectively capture, transform, and flow competitive advertising data throughout their enterprise. Wanted provides the real-time access and integration companies required today to make more informed business decisions and gain a competitive advantage. Wanted has 20 shareholders with three of them, Desjardins Capital de Risque, La Financiere Banque Nationale and Societe Innovatech Quebec, holding more than 10 per cent of Wanted's capital share, which comprises 15,480,490 Class A shares and 31,780,743 Class C shares. Assets of Wanted are located within Quebec.

In its audited financial statements for the financial year ended June 30, 2004, Wanted reported gross revenues of $825,533. Net loss for the same period amounted to $489,429, including, among others, the following items: $333,732 representing the dividend on the debt component of the Class C shares; $78,805 as amortization expense; and $129,872 as financial expense. As at June 30, 2004, total assets were $672,942, total shareholders' equity was $5,225,066 and total liabilities were $5,898,008. However, the convertible notes payable for an amount of $265,000, the convertible loans for an amount of $235,000 and the Class C shares of Wanted for an amount of $3,962,355, will all be converted into Class A common shares of Wanted before the qualifying transaction.

The parties have agreed that the total purchase price for the shares of Wanted will be $4-million payable by the issuance of 10 million Class A shares of Pamerica at a deemed value of 40 cents per common share.

In conjunction with the qualifying transaction, Pamerica will grant options to management to acquire a maximum of 1,262,500 common shares at an exercise price of 40 cents in accordance with the Pamerica incentive stock option plan.

The completion of the qualifying transaction is subject to shareholders and regulatory approvals, completion of formal agreements among the parties involved, and appropriate due diligence enquiries and investigations by said parties.

The transaction is also subject to the conclusion of a public offering of a minimum of two million common shares for total proceeds of $800,000 and a maximum of 2,625,000 common shares for total proceeds of $1.05-million at a price of 40 cents per common share.

Jones Gable & Co. Ltd., subject to satisfactory completion of due diligence, has agreed to act as agent, on a commercially reasonable best-effort basis, for the public offering. A commission of 8 per cent of gross proceeds will be payable to it on any amount subscribed for, except for subscriptions from Innovatech Quebec, for which there will be no commission. Jones, Gable will also receive broker's warrants to acquire a number of common shares equal to 10 per cent of the number of common shares issued pursuant to the public offering at the price of the said offering. The proceeds from the public offering, together with the existing working capital of the corporation following the qualifying transaction, shall serve a number of purposes including: technology development, working capital and product commercialization activities.

The acquisition of the Wanted shares and the public offering are expected to be completed concurrently and will constitute Pamerica's qualifying transaction in accordance with policies of the TSX Venture Exchange corporate finance manual.

The board of directors of the resulting issuer will comprise seven directors, including David Tanguay and Andre Forest, as well as two of the existing directors of Pamerica, Guy Girard and Christian Savard and three other persons to be named in the next weeks. Mr. Tanguay will act as chief executive officer of Pamerica and Mr. Girard as chief financial officer.

David Tanguay is the chief executive officer and co-founder of Wanted where he has raised over $6-million since 1998. Before founding Wanted, Mr. Tanguay worked as an executive for a multinational Internet solutions provider, where he was responsible for Internet software localization projects outsourced by Netscape Communications, in France, Spain, Portugal, Italy and Germany. Mr. Tanguay was the recipient of the Arista-Sun Life young entrepreneur of the year award in 2001 and sits on the boards of Royal Spring Canada, the VETIQ and the Technology Leader Network. Mr. Tanguay holds a bachelor's degree from Laval University.

Mr. Forest is founder and chief executive officer of, an Internet service dedicated to selling businesses. An engineer by trade, Mr. Forest has 25 years of experience managing and leading companies in the IT and interactive media sector. He was vice-president of the systems integration division of IST (CGI today), and then chief operating officer of SHL Systemhouse. He then founded Jobboom, a site dedicated to employment. As president, he developed the business and operational models and spearheaded the negotiation of strategic alliances with Videotron (InfiniT) and La Presse. He also lead the acquisition of Editions Ma Carriere, making Jobboom the first job board in Canada that operates both on the Web and in print. For the past few years, Mr. Forest has been a consultant to high-tech companies. He has been invited to sit on the board of directors of several companies, including Netgraphe, 3Soft and Wanted.

Guy Girard graduated from Laval University in Quebec City with a finance degree (1985) and a master's degree in finance (1992). Mr. Girard has worked from 1985 to 1998 as an adviser, director and vice-president of different Canadian brokerage firms. From 1998 to 2003, Mr. Girard worked for Corporation Avensys Inc., a firm he founded, as vice-president, finance. Mr. Girard specializes in financing businesses through acquisitions. He is a founder, the president and chief executive officer of Cogivar Corp. and a founder and director of Pamerica Corp.

Christian Savard graduated from McGill University with a bachelor of commerce degree and started his career in 1984 with a major accounting firm. Mr. Savard worked from 1986 to 2003 as a portfolio manager for a large financial institution, as president of a management consulting firm, and as advisor in two large Canadian brokerage firms before becoming, in 2003, president of CS Capital Inc., a company specialized in corporate finance. Mr. Savard is a founder and director of Cogivar Corp. and of Pamerica Corp. Mr. Savard is also president of FRIC (Fonds de rendement sur l'investissement en capital), a private venture capital company. He also holds the designation of Canadian investment manager.

The qualifying transaction was introduced to Pamerica by Blue Ship Investments Inc., who will receive a finder's fee payable through the issuance of 581,250 common shares (at a deemed price of 40 cents per common share) of the resulting issuer, for a total amount of $232,500.

Completion of the 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 shareholders approval. Where applicable, the transaction cannot close until the required shareholder approval is obtained. There can be no assurance that the transaction will be completed as proposed or at all.

© 2004 Canjex Publishing Ltd.


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