Allen-Vanguard and Tailwind Financial Inc. announce proposed merger and shareholder rights offering

    - Transaction is expected to result in recapitalization of Allen-Vanguard
      and a de-leveraged balance sheet
    - Merged entity will be U.S. listed
    - Exchange ratio of Tailwind shares for each Allen-Vanguard share equal
      to 0.046493 times the US$/C$ exchange rate on the closing date
    - Joint investor call scheduled for Monday, January 26, 2009 at 8:30 am

    OTTAWA and TORONTO, Jan. 26 /CNW Telbec/ - Allen-Vanguard Corporation
(TSX: VRS) ("Allen-Vanguard" or the "Company") of Ottawa, Canada and Tailwind
Financial Inc. (NYSE Alternext US:TNF, TNF.U, TNF.WS) ("Tailwind"), a
Delaware-based special purpose acquisition company ("SPAC") with a head office
in Toronto, Canada, today announced that they have entered into an arrangement
agreement pursuant to which Tailwind will acquire all of the shares of
Allen-Vanguard in exchange for shares of Tailwind with closing in mid April,
2009. The name of the merged entity will be Allen Vanguard Corporation.
    Allen-Vanguard is a leading global provider of integrated solutions for
protection and counter-measures against hazardous devices and materials,
including improvised explosive devices (IEDs). Tailwind was formed to effect a
business combination with an operating business and raised US$100 million in
its April 2007 IPO.
    "New capital from the Tailwind transaction and concurrent rights offering
will enable us to reduce our long-term debt in the timeframe required by our
lenders," said David E. Luxton, President and CEO of Allen-Vanguard. "This
will allow management and the board to focus on important global business
opportunities following the progress that we have made since last summer to
improve the Company's operating profit through cost restructuring and building
a strong revenue pipeline".
    "Tailwind is excited to be partnering with a strong management team and a
company with enormous potential," said Gordon McMillan, Tailwind's Chairman.
"Allen-Vanguard's proprietary products and services represent global
leadership in an attractive and growing segment of the defense and homeland
security sectors."
    Allen-Vanguard also announced that it intends to complete a rights
offering, which will be contingent on the completion of the Tailwind
transaction and required regulatory approval. Under the terms of the rights
offering, subject to such regulatory approval, Allen-Vanguard shareholders
will be given the opportunity, pro rata with their existing ownership, to
acquire subscription receipts for C$0.285 per subscription receipt entitling
the holders thereof to acquire one additional common share for each
subscription receipt. The Company will announce the expected size of the
rights offering when it files its final prospectus in the next several weeks;
the arrangement agreement permits Allen-Vanguard to complete a rights offering
of up to C$100 million.
    "We are particularly pleased that the proposed rights offering will allow
shareholders to continue to participate in the future growth of a healthy,
recapitalized Allen-Vanguard," continued Mr. Luxton. Senior management and the
board of Allen-Vanguard have unanimously approved this transaction. "It has
been a strategic objective for us to provide Allen-Vanguard's shareholders
with the benefit of a U.S. listing and Tailwind is currently listed on NYSE
Alternext US," added Mr. Luxton. "We warmly welcome Tailwind shareholders to
share in our vision and growth."
    The merger, by way of plan of arrangement, will result in a combined
entity listed on the NYSE Alternext US (formerly called AMEX). Estimates of
pro forma ownership or financial position or valuation are subject to various
assumptions and adjustments, including among other things, the size of the
rights offering, the right of holders of up to 30% of the Tailwind shares
issued in its IPO to redeem their shares for cash, exercise of warrants
associated with the current credit agreement with Allen-Vanguard's lending
syndicate (the "Lenders"), and the US$/C$ exchange rate. Allen-Vanguard and
Tailwind will make publicly available (as described below) an investor
presentation, which provides further detail on the transaction, the combined
entity, and the outcomes under different assumptions.

    Tailwind Transaction and Proposed Rights Offering

    A summary of other material terms of the Tailwind transaction follows:

    - Tailwind will acquire all of the issued and outstanding common shares
      of Allen-Vanguard in exchange for Tailwind shares. The exchange ratio
      of Tailwind shares to be issued for each Allen-Vanguard share will be
      equal to 0.046493 times the US$/C$ exchange rate on the day prior to
      the closing date.

    - Tailwind will assume all of the outstanding restricted share units and
      warrants of Allen-Vanguard that are not exercised prior to the closing
      of the transaction. All outstanding stock options not exercised prior
      to the closing of the transaction will be cancelled at the closing of
      the transaction.

    - Completion of the transaction is subject to, among other things:
      (i) the approval of two-thirds of Allen-Vanguard shareholders present
      at the meeting called to approve the plan of arrangement with Tailwind,
      (ii) the approval of a majority of Tailwind stockholders with holders
      of less than 30% of the Tailwind shares issued in its IPO exercising
      their right to vote against the transaction and elect conversion of
      their Tailwind shares for cash; (iii) the successful negotiation of a
      revised credit agreement with the Lenders and the consent to the
      completion of the transaction by the Lenders. There are no assurances
      that the Lenders will agree to such a revised credit agreement, or that
      the Lenders will consent to the completion of the transaction, and (iv)
      the approval of the plan of arrangement by the Ontario Superior Court
      of Justice.

    - Allen-Vanguard is required to pay a break fee to Tailwind of
      US$5.0 million under certain circumstances and is permitted to
      recommend an alternative transaction on terms more favorable to its
      shareholders in advance of the Allen-Vanguard shareholder meeting
      (currently scheduled for the middle of March).

    Allen-Vanguard intends to file a preliminary short form prospectus in the
next few days in respect of the rights offering of subscription receipts. The
record date and the expiry date of the rights offering will be determined
prior to the filing of a final prospectus. Allen-Vanguard will make a further
announcement with respect to these matters at the time of the filing of the
final short form prospectus. The rights offering is subject to receipt of all
regulatory approvals, including the approval of the Toronto Stock Exchange,
the Canadian securities regulatory authorities as well as the approval of the

    Joint Investor and Analyst Conference Call and Webcast

    Allen-Vanguard and Tailwind will host a joint investor and analyst
conference call and webcast as follows:

    Date:            Monday, January 26, 2009
    Time:            8:30 a.m. ET
    Dial-in numbers: 1-800-733-7571

    Web access:

    For those unable to listen to the call live, a replay will be available
for a two week period beginning at 11:30 a.m. ET on January 26, 2009. The
replay phone number is 877-289-8525 and the access code is 21295119 (pound
    Materials for this presentation are available at the following locations:

          Allen-Vanguard website, investor presentation section:

          Tailwind website:

    Forward looking statements

    This press release may contain forward-looking statements, which reflect
Allen-Vanguard and Tailwind's current expectations regarding future events,
strategy, expected performance and condition. Forward-looking statements
include statements that are predictive in nature, that depend upon or refer to
future events or conditions, or that include words such as "expects,"
"anticipates," "plans," "believes," "estimates" or negative versions thereof
and similar expressions including the completion of the transaction, the
expected benefits of the transaction and the completion of the Rights
Offering. In addition, any statement that may be made concerning future
performance, strategies or prospects, and possible future acquisitions or
dispositions, is also a forward-looking statement. Forward-looking statements
are based on current expectations and projections about future events and are
inherently subject to, among other things, risks, uncertainties and
assumptions about the parties and economic factors. Forward-looking statements
are not promises or guarantees of future performance, and actual events and
results could differ materially from those expressed or implied in any
forward-looking statements made about Allen-Vanguard or Tailwind. Any number
of important factors could contribute to these digressions, including, but not
limited to, general economic, political and market factors in North America
and internationally, interest and foreign exchange rates, global equity and
capital markets, business competition, technological change, changes in
government regulations, unexpected judicial or regulatory proceedings, and
catastrophic events. We stress that the above-mentioned list of important
factors is not exhaustive. We encourage you to consider these and other
factors carefully before making any investment decision and we urge you to
avoid placing undue reliance on forward-looking statements. Further, you
should be aware that Allen-Vanguard and Tailwind disclaim any obligation to
publicly update or revise any such forward-looking statements whether as a
result of new information, future events or otherwise, prior to the release of
the next Management Discussion and Analysis to be released by each of
Allen-Vanguard and Tailwind or except as required by law .

    Any statements contained in this press release that do not describe
historical facts may constitute forward-looking statements as that term is
defined by the United States Private Securities Litigation Reform Act of 1995.
Any such forward-looking statements contained herein are based on current
expectations, but are subject to a number of risks and uncertainties that may
cause actual results to differ materially from expectations such as material
adverse events affecting Allen-Vanguard and/or Tailwind, the ability of
Tailwind to satisfy the conditions to completion of the business combination
and those other risks and uncertainties detailed in Tailwind's filings with
the Securities and Exchange Commission.

    About Tailwind  Financial

    Tailwind was incorporated in Delaware on June 30, 2006 as a special
purpose acquisition company whose objective is to acquire, through a purchase,
asset acquisition, or other business combination, one or more operating
businesses. Tailwind completed its initial public offering on April 17, 2007
raising proceeds of US$100 million which is held in trust. All of the funds
held in Tailwind's trust account are invested in the JPMorgan 100% U.S.
Treasury Securities Money Market Fund.

    To learn more about Tailwind Financial Inc. (NYSE Alternext US:TNF,
TNF.U, TNF.WS) please visit

    About Allen-Vanguard

    Allen-Vanguard Corporation supports the mission of military and homeland
security forces around the world with leading proprietary solutions for
protection and counter-measures against hazardous devices of all kinds,
whether chemical, biological, radiological or explosive (CBRNE), including
improvised explosive devices (IEDs) and remotely controlled IEDs (RCIEDs).
Allen-Vanguard equipment is in service in more than 120 countries. Products
include Electronic Counter-Measures ("ECM") equipment for jamming remote
detonation of terrorist devices, specialty security equipment for Explosive
Ordnance Disposal ("EOD"), remote intervention robots for hazardous
applications, and personal protective wear for use in dealing with explosive
and bio-chemical agents. Allen-Vanguard is the developer and/or sole,
worldwide licensee of proprietary technologies such as the Med-Eng bomb suit,
the Defender(TM) and Vanguard(TM) Mk2 bomb disposal robots, and the Universal
Containment System and CASCAD Foam system for blast mitigation and
decontamination of bio-chemical warfare agents. Professional services
encompass counter-IED intelligence, training and advisory services, including
the Triton(TM) Report on terrorist incidents around the world. The Company
operates globally through its wholly-owned subsidiaries under the names
"Allen-Vanguard", "Med-Eng" and "Hazard Management Solutions". Head office
operations are located in Ottawa, Ontario, Canada, with manufacturing
operations in Stoney Creek and Pembroke, Ontario; Ogdensburg, New York;
Tewkesbury, U.K.; and Cork, Ireland; The Company has professional services
operations in Shrivenham, UK, Canada and in the U.S. in Arlington, Virginia,
plus sales offices in Canada, the U.S., the U.K. and Asia. Allen-Vanguard's
shares are listed on The Toronto Stock Exchange (TSX) under the symbol "VRS".

    To learn more about Allen-Vanguard Corporation (TSX: VRS), visit
    %SEDAR: 00018026E

For further information:

For further information: Allen-Vanguard Corporation: Robin Sundstrom,
(647) 822-8111,; Tailwind Financial Inc.: Andrew McKay,
(416) 601-2422,

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