THIS NEWS RELEASE IS NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES CALGARY, Alberta, May 01, 2024 (GLOBE NEWSWIRE) -- FluroTech Ltd. (TSXV:TEST) ("FluroTech"), to be renamed Consolidated Aerospace Finance Corporation ("CAFC") pursuant to the Name Change hereinafter described, and Great Slave Helicopters 2018 Ltd. ("GS Heli") are pleased to announce that further to the news releases dated April 19, 2024 and March 11, 2024, the parties, along with 15915074 Canada Inc. ("FinanceCo" or the "Company"), a wholly owned subsidiary of FluroTech (the "Parties"), have agreed to terms with Research Capital Corporation ("RCC") with respect to terms of the Offering (as defined below). RCC has agreed to act as the lead agent and sole bookrunner (the "Lead Agent"), on behalf of a syndicate of agents, including CIBC World Markets Inc., ATB Capital Markets Inc. and Canaccord Genuity Corp. (collectively, the "Agents"), in connection with a best-efforts basis, private placement offering of subscription receipts of FinanceCo (the "Subscription Receipts") at a price of C$4.00 per Subscription Receipt for aggregate gross proceeds of up to C$22,000,000 (the "Offering"), pursuant to an agreed upon term sheet dated May 1, 2024 Each Subscription Receipt will entitle the holder thereof, without payment of any additional consideration and without further action on the part of the holder, upon the satisfaction of the Escrow Release Conditions (as defined herein) to receive one common share of the Company (an "Underlying Share" or "Underlying Shares"). As previously announced, the Parties entered into a definitive agreement dated April 19, 2024 (the "Definitive Agreement") in respect of the proposed acquisition of GS Heli by FluroTech (the "Transaction"). It is intended that the Transaction will constitute a Reverse Takeover transaction of FluroTech, as such term is defined in Policy 5.2 ("Policy 5.2") of the TSX Venture Exchange (the "TSXV"). Additionally, it is intended that the Transaction will constitute a "Reactivation" under the policies of the TSXV and that upon completion of the Transaction (the "Closing") and satisfaction of all conditions of the TSXV, FluroTech as it exists upon completion of the Transaction (the "Resulting Issuer") will have its listing transferred from the NEX board of the TSXV ("NEX") to the TSXV. The Transaction is expected to be completed in Q2 2024.   About GS Heli GS Heli is a privately held corporation existing under the Canada Business Corporations Act (the "CBCA"). Headquartered in Yellowknife, Northwest Territories, GS Heli is a helicopter company with a long-standing reputation for safety, a diverse range of specialized services and logistical support. GS Heli has over 36 years of successful operations, a fleet of single and twin-engine turbine helicopters and a team of experienced professionals that continue to meet the needs of its customers in the public and private sectors. The only shareholder that holds a controlling interest both directly and indirectly in GS Heli is Mr. Pat Campling. Following the Closing, the Resulting Issuer will operate in the aviation industry, addressing the needs of helicopter aviation in the Northwest Territories, Yukon, Nunavut, Saskatchewan, Alberta, Northwest Ontario and British Columbia. With the largest local helicopter support infrastructure in northern Canada, CAFC anticipates it will significantly expand the demand for its services, drawing on a senior executive team and board that bring experience in key target markets from aviation and aircraft sectors and its strong partnerships with First Nations throughout the Northwest Territories, Nunavut, British Columbia and Alberta. Transaction Highlights - Consolidated Aerospace Finance Corporation Scalable Consolidation Strategy Following the Transaction, CAFC intends to focus on a disciplined roll-up strategy of accretive acquisitions of businesses in the aerospace sector Fragmented aviation and aerospace industry is poised for consolidation by experienced operators and supported by trends of retiring business owners accelerating succession plans Enhancing shareholder returns through prudent use of leverage Compelling Investment Opportunity FluroTech's initial transaction shall be the acquisition of GS Heli, a provider of specialized helicopter aviation services and logistical support Attractive acquisition multiple based on $65 million acquisition price Focus on Operational Efficiency to Drive Re-Rating in the Public Markets Acquire businesses at EV/EBITDA multiples based on trailing EBITDA and taking into account required annual maintenance capex and its effect on free cash flow, and seek to achieve a premium multiple by re-rating in the public markets Focus on driving margin expansion utilizing deep domain operational experience in the aviation and aerospace industry to streamline acquired company operations Opportunity to establish future quarterly dividend from portion of free cash flow from operations World Class Leadership Team Distinguished team of aviation industry leaders with proven track record of aerospace acquisition execution capabilities in the public and private markets Summary Transaction Terms In consideration for acquiring all of the issued and outstanding shares of GS Heli, the former holders of GS Heli Shares ("GS Heli Shareholders") will receive an aggregate acquisition price of $65,000,000, subject to customary adjustments (the "Purchase Price"). The Purchase Price is expected to be satisfied through: (i) the net proceeds of the Offering, including the Agents' Option (as defined below); (ii) $35,000,000 in senior debt (the "Bank Financing"); and (iii) $8,000,000 of the Purchase Price shall be satisfied through the exchange of GS Heli Shares for 2,000,000 Resulting Issuer Shares (as defined below) at the deemed price per share on the closing date of the Transaction. In connection with the Transaction, FluroTech entered into a term sheet for $35,000,000 in senior debt and $5,000,000 revolving facility. Financing Details In connection with the Transaction it is intended that, among other things: (i) the Subscription Receipts will be converted into Underlying Shares; (ii) all the outstanding common shares of the Company (including the Underlying Shares) (each, a "Company Share"), will ultimately be exchanged for Common Voting Shares of the Resulting Issuer (defined below) (the "Resulting Issuer Shares") on a basis of one Resulting Issuer Share (on a post-consolidation basis) following completion of the consolidation of the Company Shares on the basis of one Company Share for every 26.67 pre-consolidation Company Shares (the "Consolidation"), and (iii) FluroTech shall change its name to "Consolidated Aerospace Finance Corporation" (the "Name Change"). Each Resulting Issuer Share will have a deemed price of $4.00 at closing of the Transaction. FinanceCo and FluroTech will grant to the Agents an option (the "Agents' Option") to offer up to an additional number of Subscription Receipts equal to 15% of the Subscription Receipts raised in the Offering, at any time up to 48 hours prior to the closing of the Offering. The net proceeds of the Offering will be used for the acquisition of GS Heli and related transaction costs and expenses. The gross proceeds of the Offering, less the expenses of the Agents and 50% of the Agents' cash commission, will be deposited and held by a licensed Canadian trust company or other escrow agent (the "Escrow Agent") mutually acceptable to the Agents and the Company in an interest bearing account (the "Escrowed Funds") pursuant to the terms of a subscription receipt agreement to be entered into on the Closing Date among the Company, the Lead Agent, the Escrow Agent and, if reasonably required by the Lead Agent, FluroTech. The Escrowed Funds (less any remaining costs and expenses of the Agents) will be released from escrow to the ...