FluroTech Enters into Non-Binding Letter of Intent for Reverse Take-Over Transaction and Officer and Board Appointment

Toronto, Ontario--(Newsfile Corp. - December 21, 2023) - FluroTech Ltd. (TSXV: TEST.H) ("FluroTech" or the "Company") and Great Slave Helicopters 2018 Ltd. ("GS Heli") are pleased to announce that they have entered into a non-binding letter of intent in connection with an assignment agreement dated December 21, 2023 (the "Letter of Intent"), pursuant to which the Company and GS Heli intend to complete a business combination or other similarly structured transaction which will constitute a reverse take-over of the Company by GS Heli (the "Transaction"). In connection with the Transaction, the Company intends to acquire all of the issued and outstanding securities of GS Heli (the "GS Heli Shares"). It is intended that the Transaction will constitute a "Reverse Take-Over" for the Company, as such term is defined in Policy 5.2 ("Policy 5.2") of the Corporate Finance Manual of the TSX Venture Exchange (the "TSXV"). Additionally, it is intended that the Transaction will constitute the Company's "reactivation" under the policies of the TSXV and that upon completion of the Transaction (the "Closing") and satisfaction of all conditions of the TSXV, the Company 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.

About Great Slave Helicopters 2018 Ltd.

Information regarding GS Heli

GS Heli is a privately-held corporation existing under the Business Corporations Act (Alberta). 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, whose credentials are outlined below.

Following the Closing, the Company expects to operate in the aviation industry, addressing the needs of helicopter aviation in the Northwest Territories, Yukon, Saskatchewan, Alberta and British Columbia. With the largest local helicopter support infrastructure in northern Canada, the Company anticipates that 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.

Summary of Financial Information of GS Heli

 

About FluroTech

FluroTech was incorporated under the Business Corporations Act (Alberta) on May 24, 2018. FluroTech is currently inactive with limited operations and the common shares of FluroTech ("Common Shares") are currently listed on the NEX. FluroTech has no commercial operations and no assets other than cash and is a reporting issuer in the provinces of Alberta and British Columbia.

Transaction Terms

The material terms and conditions outlined in the Letter of Intent are non-binding on the parties and the Letter of Intent is, among other things, conditional on the execution of a definitive merger, amalgamation, share exchange agreement or other similar form of transaction agreement (the "Definitive Agreement") to be negotiated between the parties. There is no assurance that a Definitive Agreement will be successfully negotiated or entered into.

In connection with the proposed Transaction, it is currently contemplated that all of the issued and outstanding GS Heli Shares will be acquired by the Company for an acquisition price of ~$75 million, subject to customary adjustments, on a debt free basis (the "Purchase Price"). The Purchase Price is expected to be satisfied through a combination of bank term debt, cash and shares of the Resulting Issuer, in proportions to be determined by the Company and GS Heli. The Transaction as proposed is an arm's length transaction under the policies of the TSXV.

GS Heli does not currently have any securities convertible or exercisable for GS Heli Shares outstanding.

Completion of the Transaction is subject to a number of conditions, including, but not limited to, receipt of applicable regulatory and stock exchange approvals, including the approval of the TSXV, completion of satisfactory due diligence and the execution of the Definitive Agreement and related transaction documents.

Summary of Bridge Financing

In connection with the Transaction, FluroTech intends to complete a private placement of Common Shares for minimum proceeds of $500,000 and a maximum of $1,000,000 at a price of $0.10 per Common Share (the "Bridge Financing"). In accordance with Policy 5.2, the proceeds of the Bridge Financing will be used specifically for purposes of funding the costs associated with completing the Transaction, including costs related to audit fees, legal fees, preparation of necessary documentation for the Transaction and due diligence costs. Final approval of the Bridge Financing remains subject to approval of the TSXV, develop the Business (as defined below), and for working capital and general corporate purposes.

Consolidation

Prior to the closing of the Bridge Financing, FluroTech will complete a consolidation of the Common Shares on a 10:1 basis, as approved by the shareholder of FluroTech at its last annual general and special meeting.

Change of Business

Upon Closing of the Transaction and completion of the Concurrent Financing, it is anticipated that FluroTech will carry on the business of the aviation industry, addressing the needs of helicopter aviation in the Northwest Territories, Yukon, Saskatchewan, Alberta and British Columbia, and focus on subsequent acquisition of businesses in the aviation sector (the "Business") and will meet the Tier 1 Initial Listing Requirements for an Industrial Issuer, such that FluroTech will be graduated from the NEX to the TSXV. In connection with the Closing, it is anticipated that FluroTech will change its name to "Canadian Aviation Partners Ltd." in order to more accurately reflect its operations and the Business.

Pursuant to Section 4.1 of Policy 5.2, FluroTech will not be obtaining shareholder approval of the Transaction as: (i) the Transaction is not a "Related Party Transaction" and does not involve any Non-Arm's Length Parties (as such terms are defined in the policies of the TSXV); (ii) FluroTech is without active operations and is currently listed on the NEX; and (iii) FluroTech is not subject to, and, to the best of its knowledge will not be subject to, a cease trade order on completion of the Transaction. However, the structure of the Transaction is being finalized and, based on the final structure as reflected in the Definitive Agreement, shareholder approval may be required under applicable law. Trading in the Common Shares has been halted and is not expected to resume until the Transaction is completed or until the TSXV receives the requisite documentation to resume trading.

Completion of the Transaction is subject to a number of conditions, including, but not limited to, receipt of applicable regulatory and stock exchange approvals, including the approval of the TSXV, completion of satisfactory due diligence and the execution of the Definitive Agreement and related transaction documents.

Appointment of New Chief Executive Officer and Board Member.

The Company is also please to announce the appointment of Michael Rodyniuk as Chief Executive Officer of the Company and the addition of Mr. Rodyniuk to the board of directors of FluroTech. A description of Mr. Rodyniuk's credentials is set out below. Concurrently with the appointment of Mr. Rodyniuk, Mr. Danny Dalla-Longa, the current Chief Executive Officer of the Company, has agreed to resign from his officer position with the Company. Mr. Dalla-Longa will remain as a member of the board of directors of FluroTech. The Company wishes to thank Mr. Dalla-Longa for his services as Chief Executive Officer of the Company and is excited to have him continue on as a director as the Company works to complete the Transaction.

Management and Board of Directors of the Resulting Issuer

Subject to applicable shareholder and TSXV approval, it is anticipated that management and the board of directors of the Resulting Issuer will consist of:

Michael Rodyniuk - Chief Executive Officer and Director

Mr. Rodyniuk is a distinguished leader in the aviation industry and currently spearheads Canadian Aviation Partners Inc. as President and Chief Executive Officer. He has previously held leadership roles with Canadian North Airlines and West Wind Aviation as President and Chief Executive Officer, and with Hawaii Island Air as an executive. Mr. Rodyniuk's previous industry experience is also enriched by his past roles with Winnipeg Airports Authority as Senior Vice-President and Chief Operating Officer, with WestJet as a Director of Revenue and with the Exchange Income Corporation as the Vice-President and Chief Operating Officer.

Michael Partab - Chief Financial Office

Michael Partab, CFA, CPA, FCCA, MBA, is a distinguished finance professional that served as the Chief Financial Officer at Roust. He boasts a rich educational and professional background, including credentials as a Chartered Financial Analyst, Certified Public Accountant, and Fellow of the Chartered Association of Certified Accountants, coupled with a Master of Business Administration. Prior to his role at Roust, Michael was the Head of Finance at British American Tobacco, where he played a crucial role in financial planning and strategy. His expertise in financial management, strategic planning, and risk management has made him a pivotal figure in the industry, known for his analytical skills and ability to navigate complex financial landscapes effectively.

Dale Wang - Chief Investment Officer

At ACUIE Family Office, Mr. Wang oversaw the management of a substantial $450 million assets under management (AUM) portfolio, showcasing his profound capability in asset and investment management. His role involved a strategic approach to General Partner (GP) screening, ensuring that investments were placed with reliable and high-performing fund managers. He also exercised meticulous risk diligence, evaluating potential financial exposures and implementing measures to mitigate them effectively. Additionally, Mr. Wang provided comprehensive underwriting services, assessing the financial viability and stability of investment opportunities to guide sound decision-making. His expertise in these areas underpinned the financial success and integrity of the family office's investment portfolio.

James O'Brien - General Counsel and Corporate Secretary

Former M&A partner at a national law firm for 12 years representing a broad range of clients and regularly advising on various corporate matters focusing on the sale and acquisition of businesses across a wide array of industries including agriculture, manufacturing, aviation, transport and healthcare. Founder of a Canadian real estate asset management firm focused on the development of multi-family housing. Challenged and passed CFA Level 1 and CFA Level 2 exams with the intent of gaining the CFA designation in May of 2024.

Pat Campling - Director

Mr. Campling is the current owner and CEO of GS Heli. Mr. Campling is an aviation executive from Northern Saskatchewan with over 43 years of aviation experience and comes from a long line of aviation pioneers and innovators, being the son of the late Pat Campling Sr., the founder of La Ronge Aviation. Prior to his role as CEO of Great Slave Helicopters, Pat was the co-founder of Trans West Air and served as interim chief executive of Saskatchewan-based group West Wind Aviation.

Sid Dutchak - Director

Mr. Dutchak is a current director of FluroTech and will stay on as a director of the Resulting Issuer. Mr. Dutchak has a background in corporate and commercial law from Saskatchewan, transitioned to Calgary in 1992 as CEO of a publicly traded company. He was previously Saskatchewan's Attorney General and Chairman of Saskatchewan Mining Development Corp. (now Cameco Corp.). In Calgary, Mr. Dutchak has focused on managing public companies, serving in senior roles across various exchanges in Canada and the USA. Mr. Dutchak is skilled in structuring public companies and organizing financings and has been a key player in private and public startup ventures. He holds a B.Law from the University of Saskatchewan and is honored with the Queen's Counsel designation for his legal and public service achievements.

Stefan Georgescu- Director

Mr. Georgescu has a robust background in industry roll-ups having been involved with several high-profile Canadian industry consolidators. Mr. Georgescu has been part of National Bank's M&A investment banking team and Novacap, one of Canada's most successful private equity funds with over $8B of AUM. Mr. Georgescu played a key part in the early success of MSP Corp, an MSP consolidator that achieved a landmark sale to a private equity consortium for over $100M in under 3 years. He also played a key role in driving several operational initiatives for Canada Diagnostic Centres, Canada's largest medical imaging group which is an active consolidator. His career also includes time in Private Equity at Walter Capital and BDG & Partners. Throughout all of his roles, he has had a focus on roll-ups, contributed to operational value enhancement and the execution of M&A strategies.

Details of any further proposed board appointment nominees will be disclosed by press release, when determined.

Proposed Concurrent Financing

Prior to or concurrent with the closing of the Transaction, the Company intends to complete a brokered private placement (the "Private Placement") of subscription receipts (the "Subscription Receipts") at price and aggregate gross proceeds to be determined in the context of the market (the "Offering Price"). Each Subscription Receipt will be automatically exchanged immediately prior to the completion of the Transaction for one Common Share. In connection with the Private Placement, it is anticipated that an agent or a syndicate of agents will be paid fees and a cash commission for their services commensurate with industry norms.

Debt Conversion

At Closing, it is anticipated that approximately $347,000 of FluroTech's existing debt will be converted into shares of the Resulting Issuers at the Offering Price.

Sponsorship

Sponsorship of the Transaction is required by the TSXV unless an exemption from this requirement can be obtained in accordance with the policies of the TSXV. FluroTech intends to apply for an exemption to the sponsorship requirement. There is no assurance that an exemption from this requirement will be obtained.

Trading Halt

In accordance with Policy 5.2, the Common Shares of FluroTech are currently halted from trading and are expected to remain halted pending the requirements of Section 2.5 of Policy 5.2 being met.

Additional Information

Additional information concerning the Transaction and any connected transactions of the Company, GS Heli and the Resulting Issuer, including details on the Bank Debt, Private Placement, Transaction terms, board and management appointments, and other matters, will be provided in subsequent news releases and in the Company's management information circular or filing statement to be prepared in connection with the Transaction, to be filed in connection with the Transaction, which will be available under Flurotech's SEDAR profile at www.sedarplus.ca.

All information contained in this press release with respect to the Company and GS Heli was supplied by or from the respective party for inclusion herein, without independent review by the other party, and each party and its directors and officers have relied on the other party for any information concerning the other party.

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 requirements, majority of the minority shareholder approval, the completion of a Definitive Agreement and closing conditions customary to transactions of this nature. Where applicable, the Transaction cannot close until the required shareholder approval is obtained. There can be no assurance that the 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 Transaction, any information released or received with respect to the 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.

For further information contact:

Curtis Smith
403-472-1412
c.smith@flurotech.com

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 Note Regarding Forward Looking Information

This press release contains forward-looking statements and forward-looking information within the meaning of applicable securities laws. Any statements that are contained in this press release that are not statements of historical fact may be deemed to be forward-looking statements. Forward-looking statements are often identified by terms such as "may", "should", "anticipate", "will", "estimates", "believes", "intends" "expects" and similar expressions which are intended to identify forward-looking information or statements. More particularly and without limitation, this press release contains forward looking statements and information concerning: the Transaction; the proposed structure by which the Transaction is to be completed; the Bridge Financing; the Private Placement and the terms thereof, including the issuance of Subscription Receipts and Offering Price; the completion of the Consolidation; the proposed name change of the Company; that the Transaction will constitute the "reactivation" of FluroTech under the policies of the TSXV; satisfaction of the Purchase Price (including the Bank Debt); and the officers and directors upon completion of the Transaction. FluroTech cautions that all forward-looking statements are inherently uncertain, and that actual performance may be affected by a number of material factors, assumptions and expectations, many of which are beyond the control of FluroTech, including expectations and assumptions concerning FluroTech, the Transaction, the timely receipt of all required TSXV and regulatory approvals and exemptions (as applicable) and the satisfaction of other closing conditions in accordance with the terms of the Letter of Intent. The reader is cautioned that assumptions used in the preparation of any forward-looking information may prove to be incorrect. Events or circumstances may cause actual results to differ materially from those predicted as a result of numerous known and unknown risks, uncertainties, and other factors, many of which are beyond the control of FluroTech. The reader is cautioned not to place undue reliance on any forward-looking information. Such information, although considered reasonable by management at the time of preparation, may prove to be incorrect and actual results may differ materially from those anticipated. Forward-looking statements contained in this press release are expressly qualified by this cautionary statement.

The forward-looking statements contained in this press release are made as of the date of this press release, and FluroTech does not undertake any obligation to update publicly or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise, except as expressly required by securities law.

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