VANCOUVER, March 8, 2013 /CNW/ - Radiant Communications Corp. ("Radiant") (TSX-V: RCN) is pleased to announce that it has entered into a
definitive agreement (the "Arrangement Agreement") with Maxam Opportunities Fund LP and its affiliated entity, Maxam
Opportunities Fund (International) LP (together, "Maxam"), Pender Growth Fund (VCC) Inc. and its affiliated entity, Pender
Financial Group Inc. (together, "Pender"), and a company established jointly by Maxam and Pender for the
purposes of the transactions contemplated by the Arrangement Agreement
(the "Purchaser" and together with Maxam and Pender, collectively, the "Purchaser Group"), under which the Company would be taken private pursuant to a plan of
arrangement (the "Plan of Arrangement") under the provisions of the Canada Business Corporations Act. Maxam and Pender collectively own approximately 65% of the issued and
outstanding common shares of Radiant ("Common Shares").
Under the Plan of Arrangement, (i) the Purchaser will acquire all of the
Common Shares that Maxam and Pender do not already own for cash
consideration of $0.85 per Common Share (the "Consideration"), and (ii) all of the outstanding options of the Company ("Options"), other than Options held by management of the Company ("Management Options"), will be cancelled and optionholders holding such Options that have
an exercise price that is less than the Consideration will receive a
cash amount equal to the amount by which the Consideration exceeds the
exercise price payable under such Options. Each Management Option
outstanding immediately prior to the effective time of the Arrangement
(the "Effective Time") will be rolled over at the Effective Time into an option to purchase
equity of the Purchaser or its successor entity, subject to the same
terms and conditions as are applicable to the Management Option prior
to the Effective Time or as otherwise agreed by the parties.
The Consideration represents a 19.7% premium to the 20-day volume
weighted average price of the Common Shares on the TSX Venture Exchange
for the period ending March 7, 2013. The transaction provides total
consideration to minority shareholders of approximately $4.5 million
and implies an equity value for Radiant of approximately $12.9 million.
The board of directors of Radiant (the "Board") has unanimously determined (with Messrs. Ciampi, Edmison and Gutmanis
abstaining) that the Plan of Arrangement is in the best interests of
Radiant and is fair to its shareholders.
The determination of the Board was made upon the recommendation of a
special committee of independent directors (the "Independent Committee") and after consideration of the advice of legal and financial advisors
to the Independent Committee and the Company.
Don Calder, Chairman of the Independent Committee stated "This proposal
represents a significant premium to the 20 day volume weighted average
price of the Common Shares prior to today's announcement. We recommend
that shareholders vote in favour of the Plan of Arrangement at the
special meeting of shareholders that will be called to approve the
Evans & Evans, Inc., which is acting as financial advisor to the
Independent Committee, has provided an opinion to the effect that, as
of the date of the opinion and based upon and subject to the
limitations and qualifications therein, the consideration to be
received for the Common Shares is fair, from a financial point of view,
to the holders of the Common Shares (other than Maxam, Pender and their
affiliates). Evans & Evans, Inc. has also prepared and delivered a
formal valuation of the Common Shares under the supervision of the
Independent Committee in accordance with the standards set out in
Multilateral Instrument 61-101 - Protection of Minority Security Holders in Special Transactions ("MI 61-101").
The implementation of the Plan of Arrangement will be subject to
approval by the holders of the affected securities at the special
meeting of the Company (the "Special Meeting") to be held on April 24, 2013. The record date for the determination
of securityholders of the Company entitled to receive notice of and to
vote at the Special Meeting is March 21, 2013.
As the transaction will constitute a "business combination" for the
purposes of MI 61-101, the implementation of the Plan of Arrangement
will be subject to approval by a majority of the votes cast by
shareholders other than Maxam, Pender and their affiliates, in addition
to approval by 66⅔% of the votes cast by holders of Common Shares. The
transaction also will be subject to certain closing conditions
customary in transactions of this nature including, among other things,
a condition that certain members of management of Radiant enter into
employment and shareholder arrangements with the Purchaser.
The Arrangement Agreement provides for, among other things, a
non-solicitation covenant on the part of Radiant (subject to customary
fiduciary out provisions). The Arrangement Agreement also provides the
Purchaser with a "right to match" and requires the Company to pay the
Purchaser Group, in certain circumstances, the actual documented amount
of third party expenses of the Purchaser Group incurred in connection
with the Arrangement Agreement and the Arrangement up to a maximum
amount of $100,000.
Perlus Microcap Fund LP, an arm's length shareholder of Radiant holding
approximately 11% of the outstanding Common Shares, has entered into a
lock-up agreement with the Purchaser to vote the outstanding Common
Shares that it holds in favour of the Plan of Arrangement.
The terms and conditions of the proposed transaction will be disclosed
in an information circular that will be mailed in April 2013 to the
securityholders of Radiant that will be entitled to vote at the Special
Meeting. It is anticipated that the transaction, if approved by Radiant
securityholders and the Supreme Court of British Columbia (the "Court"), will be completed in the second quarter of 2013.
McMillan LLP and Mogan Daniels Slager LLP are acting as legal counsel to
Radiant and the Independent Committee, respectively. Cassels Brock &
Blackwell LLP is acting as legal counsel to the Purchaser and Maxam.
Copies of the Arrangement Agreement, the information circular for the
Special Meeting and certain related documents will be available on the
System for Electronic Document Analysis and Retrieval (SEDAR) website
About Radiant Communications Corp.
Radiant is a leading provider of managed network and cloud hosting
solutions for medium-size enterprises. Leveraging one of the largest
Internet footprints across Canada, Radiant offers a comprehensive
portfolio of reliable, secure and scalable IT infrastructure services,
simplified under a single point of contact. For over 15 years, many of
Canada's most recognized brand names have been relying on Radiant to
support their mission-critical business operations.
Neither TSX Venture Exchange nor its Regulation Services Provider (as
that term is defined in policies of the TSX Venture Exchange) accepts
responsibility for the adequacy or accuracy of this release.
This press release may contain forward-looking information or
forward-looking statements (collectively referred to as
"forward-looking statements"), including statements that use
forward-looking terminology such as "may", "will", "expect",
"anticipate", "believe", "continue", "potential", or the negative
thereof or other variations thereof or comparable terminology. Such
forward-looking statements may include, without limitation, statements
regarding the completion of the proposed transaction, the holding of
the Special Meeting and other statements that are not historical facts.
While such forward-looking statements are expressed by Radiant, as
stated in this release, in good faith and believed by Radiant to have a
reasonable basis, they are subject to important risks and uncertainties
including, without limitation, required Radiant securityholder approval
and necessary Court approval, the satisfaction or waiver of certain
other conditions contemplated by the Arrangement Agreement, and changes
in applicable laws or regulations, which could cause actual results to
differ materially from future results expressed, projected or implied
by the forward-looking statements. As a result of these risks and
uncertainties, the proposed transaction could be modified, restructured
or not be completed, and the results or events predicted in these
forward-looking statements may differ materially from actual results or
events. These forward-looking statements are not guarantees of future
performance, given that they involve risks and uncertainties. Radiant
is not affirming or adopting any statements made by any other person in
respect of the proposed transaction and expressly disclaims any
intention or obligation to update or revise any forward-looking
statements, whether as a result of new information, future events or
otherwise, except in accordance with applicable securities law or to
comment on expectations of, or statements made by any other person in
respect of the proposed transaction. Investors should not assume that
any lack of update to a previously issued forward-looking statement
constitutes a reaffirmation of that statement. Reliance on
forward-looking statements is at investors' own risk.
For further information about Radiant, please visit www.radiant.net.
SOURCE: Radiant Communications Corp.
For further information:
Chuck Leighton, CFO, 604.692.4531, email@example.com