TULSA, Okla., Jan. 16, 2004 (PRIMEZONE) -- Icoworks Inc. (OTCBB:ICOW) today announced that its 53% owned subsidiary Icoworks Holdings Inc. has secured $750,000 in financing commitment.
The financing commitment is comprised of a $500,000 convertible debenture and a postponement of a prior security interest to allow the Company to receive proceeds of a $250,000 mortgage financing. The convertible debenture entitles the holder to convert to a 40% interest in Icoworks Holdings Inc. If such conversions occurs prior to the proposed merger, Icoworks Inc.'s percentage ownership of Icoworks Holdings Inc. would be reduced to 32%. The convertible debenture and mortgage financing are expected to close within 30 days.
The financing will provide additional time for management to obtain alternate financing to replace the bridge loan, which had been obtained to provide capital to acquire Premier Auctioneers International Inc. and Santiago Sports and Classic Car Auctions.
Icoworks CEO Graham Douglas stated, "The challenges over the next several months will see the group trying to achieve positive cash flow while maintaining a growth strategy and securing long term financing to replace the current bridge loan. This convertible loan has provided us the flexibility to maintain our strategy and achieve our objectives."
About Icoworks
Icoworks Inc. has acquired a 53% interest in Icoworks Holdings Inc. (http://www.icoworks.com/) an integrated Commercial/Industrial Auction company. In November of 2002 Icoworks Inc. announced its intent to merge with Icoworks Holdings. Icoworks Inc. plans to acquire the remaining 47% interest in Icoworks Holdings by issuing two shares of its common stock for each remaining share of Icoworks Holdings. The Icoworks merger remains subject to approval by the shareholders. The shareholder meeting will be held once requisite regulatory documents have been prepared and filed.
Icoworks Inc., named after the Latin word "ico" (meaning to strike a bargain), is an integrated commercial/industrial auction company focused on consolidating the industry. Through its subsidiaries, Icoworks offers a complete array of industrial, oilfield, commercial appraisal, liquidation and auction services. As a consolidator of the traditional industrial auction industry, the company enhances bricks and mortar businesses by employing electronic information technologies to provide a trading environment that allows buyers and sellers of both mobile and stationary equipment to conduct transactions in a secure, convenient, geographically independent marketplace.
This Press Release may contain, in addition, to historical information, forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These statements are based on management's expectations and beliefs, and involve risks and uncertainties. These statements may involve known and unknown risks and uncertainties and other factors that may cause the actual results to be materially different from the results implied herein. Key factors that could cause actual results to differ materially from those described in forward-looking statements are:
(i) the inability of Icoworks to complete the merger with Icoworks Holdings to acquire the minority interest of Icoworks Holdings that it does not own, of which there is no assurance; and
(ii) the inability of Icoworks to achieve the financing required to pursue its plan of operations, of which there is no assurance.