TORONTO, Nov. 17, 2016 /CNW/ - Smoothwater Capital Corporation (Smoothwater Capital) announced today that it has acquired by way of a private agreement 697,728 common shares of Equity Financial Holdings Inc. ("Equity") (EQI:TSX) at a price of $9.50 per share (the "Private Purchase"). The common shares represent approximately 7.32% of the issued and outstanding common shares of Equity (based upon the 9,543,508 common shares stated to be issued and outstanding as at November 8, 2016 by Equity in its management's discussion and analysis for the quarter ended September 30, 2016 filed on SEDAR on November 8, 2016). Smoothwater made the Private Purchase for investment purposes using the "private agreement exemption" contained in Section 4.2 of National Instrument 62-104 – Takeover Bids and Issuer Bids ("NI 61-104") through the facilities of the Chi-X and Toronto Stock Exchange.
After giving effect to the Private Purchase, Smoothwater has ownership and control over 3,299,039 common shares of Equity, representing approximately 34.57% of the outstanding common shares of Equity.
Stephen J. Griggs ("Griggs") is the Chief Executive Officer and a director of Smoothwater, and a director and the Chair of the board of directors of Equity, and may be considered to be a "joint actor" with Smoothwater. Mr. Griggs exercises control over and has an ownership interest in Underwood Capital Partners Inc. ("Underwood"). Underwood has ownership and control over 38,137 common shares of Equity representing approximately 0.40% of the issued and outstanding common shares of Equity. Griggs is also the beneficial owner of 3,052 common shares of Equity pursuant to the employee share purchase plan (the "Plan") of Equity, representing approximately 0.03% of the issued and outstanding common shares of Equity. Accordingly, Mr. Griggs exercises control and direction over 41,189 Equity Shares representing approximately 0.43% of the issued and outstanding common shares of Equity. Mr. Griggs also participates in the deferred share unit plan of Equity available to directors in payment of their quarterly directors' fees.
Smoothwater and Griggs together beneficially own or exercise control and direction over an aggregate of 3,340,228 common shares of Equity, representing approximately 35.00% of the issued and outstanding common shares of Equity.
In purchasing the shares subject to the Private Purchase, Smoothwater was entitled to rely on the "private agreement exemption" because (i) the purchase of the Equity common shares was not made from more than five persons in the aggregate, (ii) the offer to purchase was not made generally to all holders of common shares of Equity, and (iii) the value of the consideration paid for the Equity common shares pursuant to the Private Purchase, including brokerage fees or commissions, was not greater than 115% of the market price of common shares of Equity on the Toronto Stock Exchange, as determined in accordance with section 1.1 of NI 62-104.
Depending on market conditions and regulatory restrictions, Smoothwater Capital, Mr. Griggs and/or Underwood may from time to time in the future acquire or dispose of common shares of Equity through open market purchases, private agreements or otherwise for investment purposes.
This news release is issued pursuant to the early warning requirements of applicable Canadian securities laws. Smoothwater Capital will file early warning reports in accordance with applicable securities laws, copies of which will be available on SEDAR at www.sedar.com or upon request to Smoothwater Capital.
Equity is located at 200 University Avenue, Suite 400, Toronto, Ontario, M5H 4H1.
About Smoothwater Capital:
Smoothwater Capital Corporation focuses on investing in small to midcap Canadian public companies where there is an identifiable path to significantly improve shareholder value. Smoothwater works to effect change in targeted companies, often collaboratively with institutional and other like-minded investors who hold material positions but are not able to take on the time consuming and costly activist role.
SOURCE Smoothwater Capital Corporation
For further information: or to obtain a copy of the related early warning report, please contact: Smoothwater Capital Corporation, Suite 2500, 120 Adelaide Street West, Toronto, Ontario, M5H 1T1, Attention: Stephen J. Griggs, Chief Executive Officer, Telephone: 416.644.6582, Email: [email protected]