Bio-key's Offer to Purchase ComnetiX Shares Breaches May 2006
OAKVILLE, ON, Jan. 30 /CNW/ - ComnetiX Inc. (TSX: CXI) announced today
that it has written to Bio-key International, Inc. and demanded that Bio-key
immediately undertake all necessary steps to withdraw its unsolicited
take-over bid for the common shares of ComnetiX.
The demand was made by ComnetiX because the offer by Bio-key is in clear
breach of a contractual undertaking made by Bio-key in favour of ComnetiX in
In May 2006, during preliminary discussions between ComnetiX and Bio-key
with respect to a possible merger or other business combination, which did not
materialize, Bio-key agreed in writing, among other things, not to acquire
ComnetiX's shares, or make an offer to acquire ComnetiX's shares, for a period
of one year. ComnetiX has not waived this "standstill" agreement, which
remains in effect until May 17, 2007.
ComnetiX has also notified Bio-key that ComnetiX may commence legal
proceedings should Bio-key fail to immediately withdraw its offer and that
ComnetiX holds Bio-key responsible for any and all costs and fees incurred by
ComnetiX (including legal fees) and any and all damages suffered by ComnetiX
as a result of Bio-key's breach of the May 2006 agreement. ComnetiX also
reserved the right to seek punitive and exemplary damages against Bio-key.
Separately, ComnetiX announced the Ontario Securities Commission has been
informed of Bio-key's breach of the "standstill" agreement.
The Board of Directors of ComnetiX continues its unanimous support of
ComnetiX's arrangement with L-1 Identity Solutions, Inc. and recommends that
ComnetiX's shareholders and warrantholders vote FOR the special resolution
approving the arrangement with L-1, under which L-1 will pay ComnetiX
shareholders US$1.12 per share in cash for all of the issued and outstanding
shares of ComnetiX, at the annual and special meeting of shareholders to be
held on February 8, 2007.
To ensure that each shareholder's or warrant holder's vote will be
counted, it is imperative that proxies be returned in advance of the Meeting
or delivered to the Chairman of the Meeting at any time prior to the
commencement of the Meeting on February 8, 2007. SHAREHOLDERS AND
WARRANTHOLDERS MAY REVOKE A PREVIOSULY-SUBMITTED PROXY VOTING AGAINST THE PLAN
OF ARRANGMENT BY COMPLETING AND DELIVERING A LATER-DATED COMNETIX MANAGEMENT
PROXY. A LATER-DATED PROXY AUTOMATICALLY REVOKES ANY AND ALL PRIOR PROXIES
GIVEN IN CONNECTION WITH THE MEETING.
Shareholders who need assistance voting or revoking a prior proxy should
contact Georgeson at 1-866-598-9985.
About ComnetiX(TM) Inc (www.ComnetiX.com)
ComnetiX(TM) Inc provides secure identification and authentication
solutions to both the public and private sectors throughout North America.
ComnetiX offers multimode biometric identification solutions for use in areas
such as applicant screening, financial services, health care, transportation,
airlines and airports, casinos and gaming, and energy and utilities. Clients
include American Airlines, Lehman Brothers, New York City Health and Hospital
Corporation, New York State Division of Criminal Justice Services, Toronto
Police Services Board, Boston Police Department and the Royal Canadian Mounted
Police. ComnetiX is also Canada's premier applicant fingerprinting services
company, facilitating tens of thousands of criminal background checks each
year through its chain of ten offices across Canada. In addition, ComnetiX has
established more than 40 applicant fingerprinting services locations
throughout the United States.
Forward Looking Statements
Statements made in this news release that relate to future plans, events
or performances are forward-looking statements. Any statement in this release
containing words such as "believes," "plans," "expects" or "intends" and other
statements that are not historical facts are forward-looking, and these
statements involve risks and uncertainties and are based on current
expectations. Consequently, actual results could differ materially from the
expectations expressed in these forward-looking statements.
For further information:
For further information: Kelly Reid, ComnetiX Inc., (905) 829-9988,