SAN DIEGO, July 26, 2017 /PRNewswire/ -- InfoSonics
Corporation ("InfoSonics" or the "Company") (NASDAQ: IFON) and
Cooltech Holding Corp. ("Cooltech") today announced that the
companies have entered into a definitive merger agreement under
which InfoSonics will acquire Cooltech. Cooltech is an Apple
licensed partner and reseller that operates as a vertically
integrated company combining a diverse distribution business with a
growing retail footprint under its OneClick branded stores.
Cooltech is one of a limited number of partners under the Apple
Premium Reseller and Apple Authorized Reseller Mono-Brand programs
in Latin America, as well as a
growing presence of OneClick stores in the United
States.
Upon the closing of the merger transaction, Cooltech will become
a wholly-owned subsidiary of InfoSonics in exchange for 62.5
million shares of InfoSonics common stock. The merger, which
has been unanimously approved by the Special Committee of
InfoSonics' Board of Directors, is subject to approval by the
Company's shareholders and a number of customary closing
conditions. The parties expect to close the transaction in
the fourth quarter of 2017.
"Cooltech has built an exceptional relationship with the largest
company in the world, Apple, to aggressively expand in related
markets to our existing business," said Joseph Ram, President
and CEO of InfoSonics. "We believe this merger represents an
accretive opportunity for InfoSonics shareholders to participate in
Cooltech's growth and maximize the value of our NASDAQ-listed
company with several synergies between our businesses."
Contemporaneous with the signing of the merger agreement,
Cooltech has signed a binding financing obligation to purchase
2.5 million shares of InfoSonics common stock at a price of
$0.40 per share in cash and warrants
exercisable into 2.5 million additional shares of InfoSonics
common stock with an exercise price of $0.484 per share (a 10% premium to the closing
bid price of InfoSonics common stock on the NASDAQ Capital market
on July 24, 2017). The
approximately $1 million of proceeds
from this private placement will be used by InfoSonics to cover
costs associated with the merger. InfoSonics also agreed to
sell investors an additional 4.375 million shares of common stock
and warrants to purchase an equal number of shares under the same
terms, contingent upon receipt of stockholder approval of such
issuance in accordance with Nasdaq rules. The proceeds from such
sale will be escrowed pending receipt of stockholder approval and
the closing of the merger.
"We are excited about this combination with InfoSonics to
enter the public markets as we continue to execute on our growth
plans in various regions with strong partners," said Mauricio Diaz, President and CEO of
Cooltech. "Our senior team has a depth of experience in
consumer electronics at many high profile companies, including
Apple, Cisco Systems, Samsung, Panasonic, and Tech Data. Our
investors have significant private equity and industry expertise,
including very successful investments in a number of other retail
plays."
About InfoSonics Corporation
InfoSonics is a
San Diego-based manufacturer and
provider of wireless handsets, tablets and related products to
carriers, distributors and retailers in Latin America under the verykool® brand.
The Company is committed to delivering quality products with
innovative designs that appeal to consumers and offer exceptional
value. Additional information can be found on its corporate
websites at www.infosonics.com and www.verykool.net.
About Cooltech Holding Corp.
Cooltech is a
Miami-based company comprised of
OneClick, a chain of retail stores and an Apple authorized reseller
under the Apple Premier Partner, APR (Apple Premium Reseller) and
AAR MB (Apple Authorized Reseller Mono-Brand) programs; and Icon
Networks, an authorized distributor to the OneClick stores and
other resellers of Apple products and other high-profile consumer
electronic brands. OneClick is one of a very limited and select
number of partners currently under the APR and AAR MB program in
Latin America. Oneclick currently has over 20 stores open in
the Americas, and has committed with Apple to an expansion plan of
stores in the region, given the experience of Cooltech's management
in this area where Apple currently has limited market
presence. Cooltech also has 4 stores in the United States, a focal point of its growth
plan moving forward. Additional information can be found on
its websites at www.cooltech.co/site/ and
www.oneclickstore.com.
Cautionary Statement Regarding Forward-Looking
Statements
This press release includes statements related to
the proposed merger between InfoSonics and Cooltech that contain
forward-looking statements, including statements regarding expected
benefits of the merger, the timing of the merger, and the
contemporaneous financings. Actual results could differ materially
from those projected or forecast in the forward-looking statements.
Factors that could cause actual results to differ materially
include the following: InfoSonics shareholders may not approve
the transaction; the conditions to the completion of the
transaction may not be satisfied; closing of the transaction may
not occur or may be delayed, either as a result of litigation
related to the transaction or otherwise; the parties may be unable
to achieve the anticipated benefits of the transaction; revenues
following the transaction may be lower than expected; operating
costs, customer loss, and business disruption (including, without
limitation, difficulties in maintaining relationships with
employees, customers, and suppliers) may be greater than expected;
the Company may assume unexpected risks and liabilities; completing
the merger may distract the Company's management from other
important matters; and the other factors discussed in "Risk
Factors" in InfoSonics' Annual Report on Form 10-K for the
fiscal year ended December 31, 2016 and in the Company's
other filings with the U.S. Securities and Exchange Commission
("SEC"), which are available at http://www.sec.gov.
InfoSonics assumes no obligation to update the information in this
release, except as otherwise required by law. Readers are cautioned
not to place undue reliance on these forward-looking statements
that speak only as of the date hereof.
Important Additional Information and Where to Find
It
In connection with the proposed transaction, InfoSonics
will file with the SEC and mail or otherwise provide to its
shareholders a registration statement on Form S-4 and proxy
statement regarding the registration of the merger consideration
shares and approval if the proposed transaction. BEFORE MAKING ANY
VOTING DECISION, INFOSONICS' SHAREHOLDERS ARE URGED TO CAREFULLY
READ THE PROXY STATEMENT IN ITS ENTIRETY WHEN IT BECOMES AVAILABLE
AND ANY OTHER DOCUMENTS FILED WITH THE SEC IN CONNECTION WITH THE
PROPOSED TRANSACTION OR INCORPORATED BY REFERENCE THEREIN BECAUSE
THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED
TRANSACTION AND THE PARTIES TO THE PROPOSED TRANSACTION. Investors
and security holders may obtain a free copy of the proxy statement
and other documents that InfoSonics files with the SEC (when
available) from the SEC's website at www.sec.gov and InfoSonics'
website at http://www.infosonics.com/. In addition, the proxy
statement and other documents filed by InfoSonics with the SEC
(when available) may be obtained from InfoSonics free of charge by
directing a request to Vern LoForti,
Vice President and Chief Financial Officer, InfoSonics Corporation,
3636 Nobel Drive, Suite 325, San
Diego, CA 92122, vern.loforti@infosonics.com; Phone:
858-373-1675.
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SOURCE InfoSonics Corporation