Completion of Hypernetics and Triodetic acquisitions
OTTAWA, April 2 /PRNewswire-FirstCall/ -- Acquisitions
Plaintree Systems Inc. ("Plaintree" or the "Company") today announced that it has completed its acquisition (the "Acquisition") of all of the issued and outstanding share capital of Hypernetics Limited ("Hypernetics") and 4439112 Canada Inc., which through a wholly-owned subsidiary owns all of the share capital of Triodetic Building Products Inc. and other subsidiaries (the "Triodetic Group of Companies"). In consideration for the $9,000,000 purchase price for the Hypernetics shares, Plaintree issued 9,000 class A preferred shares to Targa Electronics Systems Inc. In consideration for the $11,000,000 purchase price for the 4439112 Canada Inc. shares, Plaintree (i) paid the amount of $750,000 to William David Watson II and issued to William David Watson II 1,925,000 post-consolidation common shares and 5,203.75 class A preferred shares; and (ii) paid the amount of $750,000 to Nora Watson and issued to Nora Watson the 1,570,000 post-consolidation common shares and 4,121.25 class A preferred shares. The Acquisition was previously disclosed in a press release issued by the Company on February 21, 2008. The shareholders of the Company approved the Acquisition at the Company's annual and special meeting of shareholders on March 18, 2008.
As previously reported, Hypernetics was established in 1972 and is a manufacturer of avionic components for various applications including aircraft antiskid braking, aircraft instrument indicators, solenoids, high purity valves and permanent magnet alternators. The Triodetic Group of Companies, with over 40 years of experience, is a design/build manufacturer of steel, aluminum and stainless steel specialty structures such as commercial domes, free form structures, barrel vaults, space frames and industrial dome coverings. Business Combination Immediately following the completion of the Acquisition, Plaintree also amalgamated the businesses of each of Hypernetics and the Triodetic Group of Companies into Plaintree and going forward those businesses will be operated by Plaintree as separate divisions of the Company. Credit Facility The previously disclosed credit facility (the "Credit Facility") from Targa Group Inc., a company controlled by David and Nora Watson and Plaintree's largest shareholder, in the amount of up to $2.8 million to Plaintree consisting of a demand loan of $1.8 million and a revolving $1 million credit line has also been formally entered into between Targa Group Inc. and the Company. All amounts advanced to Plaintree are payable on demand and bear interest at a rate per annum equal to 2% above the prime lending rate of Targa Group Inc.'s banker as from time to time determined. The Credit Facility is secured by a security interest granted over the assets of Plaintree. $1.5 million of the $1.8 demand loan has been used by Plaintree to pay to David and Nora Watson the cash portion of the purchase price for the shares of the Triodetic Group of Companies. The balance of the demand loan and the credit line are available for drawdown by Plaintree for general capital working purposes. Creation of Class A Preferred Shares, Consolidation of Common Shares and The Company today also created the class A preferred shares which were issued as consideration in the Acquisition, consolidated the outstanding common shares of the Company on a 10 pre-consolidation shares for 1 post consolidation share basis and deleted the old unused class of preferred shares of the Company that were outstanding. Letters of transmittal will be delivered by the Company's transfer agent to the Company's registered shareholders to allow for the collection of the share certificates representing the pre-consolidation common shares of the Company and to further allow for the issuance of share certificates representing the post-consolidation common shares of the Company. Return of Options for Cancellation The Company also announced today that William David Watson II, the President and Chief Executive Officer of the Company, returned to the Company for cancellation 3,000,000 pre-consolidation options to acquire common shares of the Company and William David Watson, the Chairman of the Board of Directors and Vice President of Mergers and Acquisitions of the Company, returned to the Company for cancellation 2,800,000 pre-consolidation options to acquire common shares of the Company. As a result, the total number of outstanding options of the Company to acquire common shares of the Company has decreased to 217,500 post-consolidation options to acquire common shares and the number of options available for future issuance has increased to 982,500 post-consolidation options to acquire common shares. About Plaintree Systems
Plaintree is publicly quoted in the U.S. on the OTC BB (LANPF), with 12,721,634 common shares (post-consolidation) and 18,325 class A preferred shares outstanding. This press release may include statements that are forward-looking and based on current expectations. The actual results of the company may differ materially from current expectations. The business of the company is subject to many risks and uncertainties, including changes in markets for the company's products, delays in product development and introduction to manufacturing and intense competition. For a more detailed discussion of the risks and uncertainties related to the company's business, please refer to documents filed by the company with the U.S. Securities and Exchange Commission, including the Company's Form 20-F dated September 28, 2007.
CONTACT: Lynn Saunders, (613) 623-3434 ext. 3002
2008-04-02 17:42:16 0326900 PRNEWSWIRE
HOME || Press Release Archive || © Leigh Media Corporation || Terms of Use || Privacy Policy || Publish Your Press Release Here |