SOURCE: Northstar Electronics, Inc.
VANCOUVER, BC--(Marketwire - Aug 29, 2012) - Northstar Electronics, Inc. (PINKSHEETS: NEIK) provides this update.
Northstar Electronics has previously announced that it has signed a definitive agreement for the sale of its subsidiary, Northstar Network. The purchaser, Empower Technologies, has announced that it has received TSX Venture Exchange conditional approval for the acquisition. Closing of the transaction is subject to a number of conditions typical of a transaction of this nature, as set forth in the definitive agreement between the parties. The parties have agreed that the outside date for completion of the transaction is September 30, 2012.
Under the Amended Agreement, the aggregate purchase price for NNL is reduced to $3,186,176, which Empower will satisfy at closing as follows:
(a) $61,655 advanced by Empower to Northstar Electronics for working capital will be deemed paid and set off against the purchase price;
(b) Empower will assume NNL's liabilities in the amount of $3,012,021; and
(c) Empower will issue to Northstar Electronics common share purchase warrants, which entitle the holder to acquire an aggregate of 4,000,000 Empower common shares for a period of three years from the date of issuance. The terms of the warrants are as follows:
- 1,000,000 warrants will be exercisable at $0.10 per Empower share;
1,000,000 warrants will be exercisable at $0.20 per Empower share;
1,000,000 warrants will be exercisable at $0.25 per Empower share;
1,000,000 warrants will be exercisable at $0.30 per Empower share.
The warrants will provide that the holder will give Empower not less than 30 days prior written notice of any proposed exercise of warrants to acquire more than 200,000 Empower shares.
Empower has advanced an aggregate of $142,726.66 to NNL to date for working capital. This debt will remain outstanding as an intercompany loan following closing.
The Amended Agreement also provides for a new outside closing date of September 30, 2012, after which the agreement will terminate unless further extended by the parties. Closing is anticipated to occur on or before September 30, 2012.
Dr. Wilson Russell, CEO Northstar, says: "Now that conditional approval has been received, we can continue on our path forward with sonar technologies within NEIK. We will keep shareholders updated through press releases and filings as relates to the final completion of this disposition."
Northstar Electronics, Inc. is a holding company with executive management specialized in design engineering, defense, advanced systems, security, sonar, systems integration, and prototyping fields. Northstar is actively pursuing opportunities through acquisition, joint venture, or merger to increase revenues and expand its base of subsidiaries. http://www.northstarelectronics.com
Safe Harbor Statement
This press release contains forward-looking statements. These forward-looking statements are based on the current plans and expectations of management and are subject to a number of uncertainties and risks that could significantly affect the company's current plans and expectations, as well as its future results of operations and financial condition. Such risks include, but are not limited to, the effects of competition with existing enterprises and/or new entrants into the company's markets and industries, fluctuations in currency exchange rates, domestic and global economic conditions generally, the company's ability to obtain financing and attract suitable personnel where required to fully implement its business plan, the adoption and acceptance by the marketplace of the company's technologies and product and service offerings, the possibility of new technologies that are competitive with the company's planned product and service offerings and the effects of future political and economic developments both in the United States and abroad, among others. The company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of information, future events or otherwise.