REBEL CAPITAL INC. ANNOUNCES LETTER OF INTENT FOR ACQUISITION OF A DATA CENTER PROPERTY AS QUALIFYING TRANSACTION Including C$34 Million Equity Private Placement
REBEL CAPITAL INC. ANNOUNCES LETTER OF INTENT FOR ACQUISITION OF A DATA
CENTER PROPERTY AS QUALIFYING TRANSACTION
Including C$34 Million Equity Private Placement
May 31, 2019 VANCOUVER, British Columbia – Rebel Capital Inc. (“Rebel” or the “Corporation”)
(TSXV: RBL.P), a capital pool company, is pleased to announce that it has entered into a non-
binding letter of intent dated May 30, 2019 (the “Letter of Intent ”) with Chief Commercial
Construction L.P., a Pennsylvania limited partnership (the " Vendor"), to acquire a property
located in Pittsburgh, Pennsylvania containing a 91,790 square foot data center with a three-story
connected 43,800 square foot office property on an approximately 7.65 acre site (collectively, the
“Property”) for a total purchase price (the “Purchase Price”) of US$32 million (the “Proposed
Transaction”).
The completion of the Proposed Transaction will be subject to requisite regulatory approval,
including the approval of the TSX Venture Exchange (the “TSXV”), and a number of additional
conditions precedent, including the negotiation and execution of a definitive agreement, and the
completion of a brokered private placement financing to fund a portion of the Purchase Price.
There can be no assurance that the Proposed Transaction will be completed on the terms
proposed in the Letter of Intent or at all.
The Proposed Transaction is intended to constitute Rebel’s “Qualifying Transaction” in
accordance with TSXV Policy 2.4 - Capital Pool Companies . On closing of the Proposed
Transaction, Rebel anticipates being classified as a "Tier 1" real estate issuer that will meet the
TSXV's initial listing requirements applicable therefor. The Proposed Transaction will not be a
Non-Arm's Length Qualifying Transaction (as that term is defined under the TSXV policies), and
as a result, it is anticipated that the approval of the shareholders of Rebel to the Proposed
Transaction will not be required. However, depending on the ultimate structuring of the Proposed
Transaction, Rebel may be required to obtain shareholder approval under corporate law to
approve certain matters ancillary to the Proposed Transaction.
Earnest Money Deposit and Proposed Non-Brokered Private Placement Financing
Pursuant to the Letter of Intent, Rebel has a 60-day period from the date of the Letter of Intent to
conduct due diligence on the Property. In connection therewith, Rebel is required to deposit
US$640,000 (the “Deposit”) as earnest money with Chicago Title Insurance Company within five
days of the date of the Letter of Intent. The Deposit will be held in trust pending completion or
termination of the Proposed Transaction. If the Proposed Transaction proceeds, the Deposit
would be credited on account of the Purchase Price on closing of the Proposed Transaction.
It is anticipated that a newly created entity to be acquired by Rebel on completion of the Proposed
Transaction will, as soon as possible, complete a non-brokered equity private placement (the
“Non-Brokered Financing”) for gross proceeds of no less than C$1 millionto fund payment of
the Deposit and certain other diligence-related costs and expenses in connection with the
Proposed Transaction. The actual size of the Non-Brokered Financing (subject to a minimum of
C$1 million) and the issue price will be determined in the context of the market.
Proposed Brokered Private Placement Financing
It is also anticipated that Rebel will complete a brokered private placement of subscription receipts
(the “Brokered Financing”) for gross proceeds of approximately C$34million to fund a portion
of the Purchase Price. The actual size of the Brokered Financing and the issue price will be
determined in the context of the market.
Rebel has engaged Canaccord Genuity Corp. (“Canaccord”) to act as the lead agent in
connection with the Brokered Financing. In connection with the Brokered Financing, Canaccord
will be paid a cash commission equal to 6.0% of the gross proceeds of the Brokered Financing
and, subject to regulatory approval, compensation options exercisable at any time up to 18
months following the date of closing of the Brokered Financing to purchase up to that number of
common shares of Rebel as is equal to 6.0% of the number of Subscription Receipts sold pursuant
to the Brokered Financing, at an exercise price equal to the issue price of the Subscription
Receipts.
The gross proceeds of the Brokered Financing will be held in escrow pending satisfaction of
certain specified escrow release conditions, including the satisfaction of all conditions precedent
to the completion of the Proposed Transaction (other than the payment of the Purchase Price).
The Non-Brokered Financing and the Brokered Financing are both subject to TSXV approval.
Appointment of Shant Poladian and Anish Chopra to Rebel’s Board of Directors
Rebel is pleased to announce that Shant Poladian and Anish Chopra have been appointed to
Rebel’s board of directors, subject to TSXV approval. In addition, Mihalis Belantis has agreed to
resign as a director of the Corporation.Messrs. Poladian and Chopra bring significant experience
in real estate and capital markets. For additional information see Messrs. Poladian and Chopra’s
biographies under “Proposed Management and Directors” below.
Proposed Management and Directors
Subject to TSXV approval, on completion of the Proposed Transaction, it is currently anticipated
that the board of directors of Rebel will consist of the following five directors and the management
will consist of Mark MacDonald, Shant Poladian, Joe Damiani and Wilbur Wong.
Mark MacDonald, Director and Co-Chief Executive Officer
Mr. MacDonald is founder and Chief Executive Officer of C15Edge Data Centers, which has
developed and operates a highly secure, redundant 24/7 colocation facility in Toronto, Ontario. In
addition, Mr. MacDonald has over 30 years of experience in broad investment, corporate
development and restructuring, including co-managing Ontario Teachers Pension Plan’s $4.5
billion portfolio of private investments.
Shant Poladian, Director and Co-Chief Executive Officer
Mr. Poladian has over 20 years of experience in real estate and capital markets, including as the
founding Chief Executive Officer of FAM REIT which developed, leased and financed a 3 MW
64,000 square foot mission critical data center in Winnipeg, Manitoba for Bell MTS. In addition,
Mr. Poladian has acted as a director of Amica Mature Lifestyles Inc., Equity Research Analyst at
Canaccord Genuity and Managing Director – Investment Banking at Eight Capital.
Joe Damiani, Chief Operating Officer
Mr. Damiani is a data center and cloud service professional with over 25 years of international
experience in Service Provider, IT Outsourcing and Financial Services verticals. Most recently
Vice President at C15Edge Data Centers, Mr. Damiani assisted with the launch and growth of the
organization. Mr. Damiani was formerly VP & GM, Capris Data Center, Director, ThinOffice at
Ceryx and Director, Product at Bird on a Wire Networks (acquired by AT&T Canada).
Wilbur Wong, Interim Chief Financial Officer and Chief Investment Officer
Mr. Wong has over 10 years of experience in real estate and capital markets, including VP of
Investments for FAM REIT. Mr. Wong is a former VP of Investment Banking at Eight Capital,
Director of Asset Management at KEYreit, Asset Manager for GWL, and Real Estate Analyst for
Delta Hotels and Blackwood Partners.
T. Richard Turner, Independent Director
Mr. Turner currently serves as Board Chair of ViveRE Communities Inc. He has acted as chair
and/or director of many public real estate companies/REITs, including Pure Industrial Real Estate
Trust, Invesque Inc., HealthLease Properties Real Estate Trust, IAT Air Cargo Income Fund and
Sunrise Senior Living Real Estate Trust.
Andrew Oppenheim, Independent Director
Mr. Oppenheim is a partner and corporate lawyer at Gowlings WLG and has acted as the lead
independent director of Amica Mature Lifestyles Inc.
Anish Chopra, Independent Director
Mr. Chopra is a Managing Director and Portfolio Manager at Portfolio Management Corp. Mr.
Chopra has acted as a Managing Director and Head of the Innovative Solutions Group at TD
Asset Management.
Details of insiders of Rebel will be disclosed in a further news release.
Filing Statement and Information Circular
In connection with the Proposed Transaction and pursuant to the requirements of the TSXV,
Rebel will file a filing statement or a management information circular on its issuer profile on
SEDAR at www.sedar.com, which will contain details regarding the Proposed Transaction, the
Brokered Financing and the Property.
Sponsorship
Sponsorship of a qualifying transaction of a capital pool company is required by the TSXV unless
an exemption from the sponsorship requirement is available. The parties will be seeking a waiver
of any requirement for a sponsor, but in the event a waiver is not available, the parties will update
the markets accordingly.
Trading Halt
Trading in the Rebel Shares has been halted in compliance with the policies of the TSXV. Rebel
anticipates that trading will remain halted pending the review of the Proposed Acquisition by the
TSXV.
General
Rebel will issue additional news releases relating to the Proposed Transaction, including
information relating to transaction structure, the Brokered Financing and summary financial
information of the Property, if and when the parties enter into the definitive agreement. For further
information, please contact:
Craig Lindsay
(604) 218-0559
Completion of the Proposed Transaction is subject to a number of conditions, including but not
limited to, TSXV acceptance and if applicable pursuant to TSXV, majority of the minority
shareholder approval. Where applicable, the Proposed Transaction cannot close until the
required shareholder approval is obtained. There can be no assurance that the Proposed
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 Proposed Transaction, any information released
or received with respect to the Proposed 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.
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
the TSXV nor its Regulation Services Provider (as that term is defined in the policies of the TSXV)
accepts responsibility for the adequacy or accuracy of this release.
Cautionary Statements Regarding Forward-Looking Information
This press release contains forward-looking information within the meaning of Canadian securities
laws. Such information includes, without limitation, information regarding the terms and
conditions of the Proposed Transaction, the terms of the Non-Brokered Financing and the
Brokered Financing and the composition of the board of directors of the resulting issuer upon
completion of the Proposed Transaction. Although Rebel believes that such information is
reasonable, it can give no assurance that such expectations will prove to be correct.
Forward looking information is typically identified by words such as: “believe”, “expect”,
“anticipate”, “intend”, “estimate”, “postulate” and similar expressions, or are those, which, by their
nature, refer to future events. Rebel cautions investors that any forward-looking information
provided by Rebel is not a guarantee of future results or performance, and that actual results may
differ materially from those in forward looking information as a result of various factors, including,
but not limited to: Rebel's ability to complete the Proposed Transaction; the expected timing and
terms of the Proposed Transaction and the related private placements; the state of the financial
markets for Rebel's securities; the state of the real estate sector in the event the Proposed
Transaction is completed; recent market volatility; Rebel's ability to raise the necessary capital or
to be fully able to implement its business strategies; and other risks and factors that Rebel is
unaware of at this time. The reader is referred to Rebel's initial public offering prospectus for a
more complete discussion of applicable risk factors and their potential effects, copies of which
may be accessed through Rebel’s issuer page on SEDAR at www.sedar.com.
The forward-looking statements contained in this press release are made as of the date of this
press release. Rebel disclaims any intention or obligation to update or revise any forward-looking
statements, whether as a result of new information, future events or otherwise, except as required
by law.
About Rebel
Rebel is incorporated under the provisions of the Business Corporations Act (British Columbia)
with its registered and head office in Vancouver, British Columbia. Rebel is a “reporting issuer” in
the provinces of Ontario, British Columbia and Alberta. The Rebel Shares are listed for trading on
the TSXV under the symbol “RBL.P”.
SOURCE: Rebel Capital Inc.