The Phoenician Fund Corporation I and Digital Payment Solutions, Inc. Announce Intention to Complete a Business Combination and Proposed Financing by the Phoenician Fund Corporation I

Marketwired

TORONTO, ONTARIO--(Marketwire -08/17/12)- NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES

The Phoenician Fund Corporation I (TSX-V:PO.H) ("Phoenician"), a capital pool company, and Digital Payment Solutions, Inc. ("DPSI") are pleased to announce that they have entered into an arm's length letter of intent executed August 16, 2012 (the "Letter of Intent") to complete a business combination (the "Qualifying Transaction"). If completed, the business combination will constitute Phoenician's qualifying transaction pursuant to the policies of the TSX Venture Exchange (the "Exchange").

Phoenician and DPSI are also pleased to announce that Phoenician has signed an engagement agreement with All Group Financial Services Inc. to raise a minimum of $2,000,000 and a maximum of $3,000,000 through a brokered private placement (the "Private Placement") as described below. Under the terms of the Private Placement Phoenician will offer common shares at a price of $0.10 per share.

Information Concerning Phoenician

Phoenician is a company existing under the laws of Ontario and is a reporting issuer in Alberta, British Columbia and Ontario. Phoenician currently has 7,410,333 common shares (the "Phoenician Shares") outstanding, of which 625,000 are currently held in escrow pursuant to the policies of the Exchange, and a convertible debenture (the "Debenture") in the aggregate principal amount of $10,000 that will be converted, subject to receiving approval from the Exchange, on closing of the Qualifying Transaction into an additional 200,000 common shares (the "Convertible Shares"). Phoenician also intends to issue between 20,000,000 and 30,000,000 common shares (the "PP Shares") pursuant to the Private Placement for gross proceeds of a minimum of $2,000,000 and a maximum of $3,000,000 to be completed on or prior to completion of the Qualifying Transaction. The proceeds of the Private Placement will be used for marketing and working capital.

Phoenician has granted stock options to acquire up to an aggregate of 375,000 additional common shares in the capital of Phoenician at a price of $0.16 per share (the "Phoenician Options") to directors, officers and consultants of Phoenician. Phoenician has also issued options to a registered charity to acquire up to an aggregate of 37,500 additional common shares in the capital of Phoenician at a price of $0.16 per share (the "Phoenician Charity Options"). Other than the Phoenician Options, Phoenician Charity Options and the Debenture, no other securities of Phoenician, convertible or exchangeable into shares of Phoenician, are outstanding.

Further information concerning Phoenician can be found in the prospectus of Phoenician dated August 30, 2007. Its audited financial statements for the year ended September 30, 2011 and accompanying management discussion and analysis and its interim financial statements for the six months ended March 31, 2012 and accompanying management discussion and analysis all of which can be found on SEDAR at www.sedar.com.

Information Concerning DPSI

DPSI is a private company incorporated under the laws of Canada and is a unique, Canadian integrated payment solutions company which is focused on providing alternative financial services to a growing population of Canadians.

DPSI invests in and develops companies and technologies that leverage internet and mobile technologies to deliver innovative and vital financial solutions to a growing population of consumers and businesses.

DPSI's core business is comprised of four products / services, operated under the four wholly owned subsidiaries set out below:

MobiCash Solutions Inc., a money transfer business;

Quantum Card Services Inc. a prepaid cards company;

PayCheck Plus Inc., a company providing payday loan services; and

NovelPay Inc, a company that provides global payment technologies & solutions.

DPSI has invested in developing the technology and administrative platform for its core business. All the necessary technology to implement DPSI's strategic business plan is either owned directly by DPSI or, where licensed by DPSI, includes full control of the source code.

DPSI's un-audited financials as at March 31st 2012 reflect total assets of $730,000 and total liabilities of $2,100,000 with $1,900,000 of which is in the form of a long term shareholder loan liability which will be converted into equity prior to the completion of the Qualifying Transaction.

Phoenician intends to issue 60,000,000 common shares priced at $0.10 per share to DPSI on completion of the Qualifying Transaction for all outstanding common shares of DPSI at the date of closing. Phoenician also intends to issue additional options representing up to 10% of the outstanding capital of Phoenician post Qualifying Transaction (the "Additional Phoenician Options") to directors, officers, employees and consultants, each such option entitling the holder thereof to purchase one Phoenician Share at a price of $0.10 per share.

There are currently 5 registered shareholders of DPSI. Prior to completion of the Qualifying Transaction Loriana Valente will own a total of 40% of the outstanding shares of DPSI (the "DPSI Shares"), Elesha Singh will own 40% of the DPSI Shares (10% directly and 30% through Dramuda Inc., which is controlled by Ms. Singh), Shayna Singh will own 10% of the DPSI Shares and Kendal Singh will own 10% of the DPSI Shares prior to completion of the Qualifying Transaction. All of the shareholders of DPSI are resident in Ontario other than Ms. Shayna Singh who resides in New York. Following the completion of the Qualifying Transaction only Loriana Valente and Elesha Singh will own more than 10% of the issued and outstanding shares of Phoenician. Biographical paragraphs for these shareholders are set out below.

Other than the shares and options referred to above, no other securities of DPSI, convertible or exchangeable into shares of DPSI, are outstanding.

Information Concerning the Proposed Qualifying Transaction

Phoenician and DPSI have entered into the Letter of Intent setting out certain terms and conditions pursuant to which the proposed Qualifying Transaction will be completed. The Qualifying Transaction is subject to the parties successfully negotiating and entering into a definitive business combination agreement, amalgamation agreement, share purchase agreement or other similar agreement such that the Qualifying Transaction may be completed on a tax preferred basis to the parties thereto.

The completion of the Qualifying Transaction is subject to the approval of the Exchange and all other necessary regulatory approvals. It is also subject to additional conditions precedent, including shareholder approvals of Phoenician and DPSI as required under applicable corporate or securities laws, satisfactory completion of due diligence reviews by both parties, approvals of the board of directors of Phoenician and DPSI and certain other conditions customary for transactions of this nature. As the Qualifying Transaction is an arm's length transaction, it is not contemplated that shareholder approval of Phoenician will be required by the Exchange (except as may be otherwise required by law) provided that Phoenician files a filing statement with the Exchange. The target closing date for the Qualifying Transaction is November 30, 2012 or such other date as the parties may mutually agree on.

Phoenician will make an application to the Exchange for an exemption from the sponsorship requirement of the Exchange policies. There is no certainty that such exemption will be granted.

A filing statement will be prepared by Phoenician in respect of the Qualifying Transaction. Trading in the Phoenician Shares will remain halted until at least the time of such press release upon receipt of the sponsorship exemption or the appointment of a sponsor and pending the completion of certain due diligence investigations by the Exchange including Exchange review of the proposed business and background searches conducted against the directors and officers of the resulting issuer. There can be no assurance that trading in the Phoenician Shares will resume prior to the completion of the Qualifying Transaction.

Management and Board of Directors of Resulting Issuer

Upon completion of the Qualifying Transaction, it is anticipated that management and directors of the resulting issuer will include the persons identified below. Additional proposed directors and officers of the resulting issuer will be identified at a later date.

John Papadakis - Chief Executive Officer

John Papadakis is a strategic executive recognized for his success in building and operating profitable businesses for both large global players and entrepreneurial enterprises. Mr. Papadakis is currently the Chief Executive Officer of Digital Payment Solutions Inc., an alternative money solutions company. Prior to DPSI, Mr. Papadakis was the Chief Operating Officer of Tricrest Corporation, a North American ICT solutions provider.

Before joining Tricrest, Mr. Papadakis was the Senior Vice President of Operations and CTO at 411.ca, a leading independent on-line local search company in Canada. Prior to that, Mr. Papadakis held senior executive roles with various companies including Rogers Communications, where he provided the full life-cycle of services and support of all business revenue, and Avaya where he had full P&L responsibility for Avaya Global Services in Canada.

Mr. Papadakis holds an Honours B.A.Sc. degree in Electrical Engineering from the University of Toronto.

Christopher N. Malone - Chief Financial Officer and Director

Christopher Malone is currently a director of Phoenician and also currently holds the position of Chief Financial Officer at Magna Partners Limited, an IIROC registered dealer member. He is also a director of PrOasis, a professional consulting firm where he has spent the past 20 years managing the firm which focuses on business technology solutions and finance for major Canadian organizations.

Mr. Malone has extensive listing, reporting and governance experience with public companies on the TSX and TSXV in Canada and Plus Markets in the United Kingdom and was formerly a director of Snap Newspaper Group Inc., a community based newspaper franchising company. Mr. Malone's experience stems from over 29 years in the Canadian workforce holding senior financial and information technology systems roles in some of Canada's largest multi-national organizations. He has held senior level financial positions in food processing, telecom, media advertising, document management and investment organizations. Mr. Malone holds a CMA designation and graduated from the University of Western Ontario with a B.A. in Commerce and Economics.

Joe Parent - Vice-President Product Development & Operations

Joe Parent has over 20 years experience in senior marketing and sales positions within the highly competitive communications and technology industry. He has worked for such firms as Vonage Communications, Sprint Canada, Unitel/AT&T and others. He has worked with newly deregulated and rapidly growing new market entrants and also has extensive experience with start up companies. He has held a variety of responsibilities including product management/development, branding, strategy, communications, media & public relations and regulatory affairs. Mr. Parent also has experience working with communications companies in the United States and Europe. Mr. Parent earned a Bachelors degree in Economics from the University of Windsor and an MBA from McMaster University (Marketing & International Business).

Elesha Singh - Director and Insider

Ms. Singh has over 10 years experience in operational management and marketing in the financial services industry. With specific focus on start-up ventures, Ms. Singh supervised the research, design and implementation of a pre-paid credit card program used to facilitate money remittance services.

Ms. Singh brings a wealth of experience in project management, creating marketing strategies, developing policies and administrative procedures that structure business processes and transforming owner/operator models into corporate structures.

Ms. Singh received her Bachelor's degree in Economics from York University in Toronto and her Masters of Business Administration in Marketing from Centenary College in New Jersey.

Bhaktraj (Raj) Singh - Director

Mr. Singh is a senior results oriented business executive with over 20 years of experience building and managing technology services and solutions companies. Mr. Singh blends his visionary and strategic thinking with a sound analytical and operations background and has conducted business globally. Mr. Singh has extensive experience advising clients on their global procurement and human capital management strategy, solutions and infrastructure.

Mr. Singh was the co-founder, President & CEO and director of Brainhunter Inc., a technology solutions & services firm that was publicly traded on the Toronto Stock Exchange. Prior to founding Brainhunter.com, Mr. Singh was an executive at a leading Toronto based IT services firm where he played a key role in its substantial growth and success.

Mr. Singh holds a B.Sc. from York University, an MBA from Florida International University and has completed executive development training in M&A at Wharton School of Business.

Mr. Singh has been a speaker and panelist at various staffing industry events.

Mr. Singh has co-authored and published 3 scientific research papers in international research journals.

Loriana Valente - Insider

Ms. Valente, a York University graduate with a B.A. degree, has spent many years as a client service manager for a large financial planning organisation; In the past few years she has owned and operated two successful Banquet and conference centres; Most recently, Ms. Valente has been actively involved in the family run businesses in the financial services sector. She was involved with predecessor companies in their initial research and development stages, which has led to the creation of the DPSI companies.

Phoenician and DPSI are currently undertaking a search for a fourth director who will be independent of management and the controlling shareholders of DPSI. Additional information will be provided once the selection process has been completed.

As noted above, completion of the Qualifying Transaction is subject to a number of conditions, including, but not limited to, acceptance by the Exchange and if applicable pursuant to Exchange requirements, majority of the minority shareholder approval. Where applicable, the Qualifying Transaction cannot close until the required approvals have been 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 proposed Qualifying Transaction, any information released or received with respect to the proposed 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 to be highly speculative.

This press release contains projections and forward-looking information that involve various risks and uncertainties regarding future events. Such forward-looking information can include without limitation statements based on current expectations involving a number of risks and uncertainties and are not guarantees of future performance of Phoenician. These risks and uncertainties could cause actual results and Phoenician's plans and objectives to differ materially from those expressed in the forward-looking information. Actual results and future events could differ materially from those anticipated in such information. These and all subsequent written and oral forward-looking information are based on estimates and opinions of management on the dates they are made and expressly qualified in their entirety by this notice. Phoenician assumes no obligation to update forward-looking information should circumstances or management's estimates or opinions change.

The Exchange has in no way passed upon the merits of the proposed Qualifying Transaction and has neither approved nor disapproved the contents of this release.

(NOT FOR DISSEMINATION IN THE UNITED STATES OF AMERICA)

Contact:

Phoenician Fund Corporation I
Chris Malone
Director
(416) 816-4803
Digital Payment Solutions, Inc.
John Papadakis
Chief Executive Officer
(905) 731-9391

View Comments (0)