MANAGEMENT-LED GROUP ANNOUNCES INTENTION TO LAUNCH TAKEOVER BID FOR THE COMMON SHARES OF CANACCORD GENUITY GROUP INC. AT C$11.25 CASH PER COMMON SHARE
The offeror group holds approximately 21.3% of the issued and outstanding common shares
Compelling proposal to the shareholders which is supported by the Company's largest independent shareholder
Represents a 41.9% premium to the preceding 20-day VWAP
TORONTO, Jan. 9, 2023 /CNW/ - 1373113 B.C. Ltd. (the "Offeror") announced today that it intends to commence an all–cash take-over bid (the "Proposed Offer"), on behalf of itself and a management-led group consisting of officers and employees of Canaccord Genuity Group Inc. ("Canaccord Genuity" or the "Company") (TSX: CF) and its subsidiaries (collectively, the "CG Employee Group", and together with the Offeror, the "Offerors"), to acquire all of the issued and outstanding Common Shares of the Company (other than certain Common Shares beneficially owned by the CG Employee Group) at a price of C$11.25 per Common Share (the "Offer Price"). The Proposed Offer values the Common Shares of the Company at approximately C$1.127 billion.
The Offer Price of C$11.25 per Common Share represents a 30.7% premium to the closing price of the Common Shares on January 6, 2023 and a 41.9% premium to the preceding 20-day VWAP.
The CG Employee Group, which collectively owns approximately 21.3% of the issued and outstanding Common Shares, is comprised of the President & CEO, Chairman, all members of the Company's Global Operating Committee and additional senior and tenured employees from all Canaccord Genuity businesses and geographies.
"We are pleased to be presenting this compelling proposal to the Shareholders, including our largest independent Shareholder, who is supportive of the Proposed Offer," said Mr. Daniel Daviau, President and Chief Executive Officer of the Company and indirectly the sole shareholder of the Offeror. "The geographically diverse business has proven to provide excellent advantages for the Company's clients, but the Common Shares, which naturally reflect the inherent volatility of the global capital markets in which the Company operates have proven to be not well-suited for trading in a public marketplace. After the completion of the Proposed Offer, as an employee-owned business, the Company will be able to focus its efforts solely on advancing its proven strategies in ways that serve the best interests of its clients, while continuing to support a vibrant marketplace for issuers in need of capital, entrepreneurs bringing new companies and ideas to market and investors in our wealth management and capital markets businesses."
Upon completion of the Proposed Offer and any compulsory or subsequent acquisition transaction, all of the Common Shares will be indirectly held by officers and employees of the Company and its subsidiaries. The executive leadership, management, underlying corporate structure and operations of the Company are not expected to materially change.
In connection with the Proposed Offer, the Offeror has entered into support agreements with certain non–management holders of Common Shares ("Shareholders"), including the Company's largest Shareholder (collectively, the "Lock-Up Agreements"). Such supporting Shareholders collectively own approximately 10.7% of the issued and outstanding Common Shares as of the date hereof and have agreed to, among other things deposit their Common Shares to the Proposed Offer, subject to certain exceptions and conditions. The Lock-Up Agreement with the Company's largest Shareholder is in respect of approximately 8.8% of the Common Shares and is a "hard" lock–up agreement, meaning that it will not terminate even in the event of a competing proposal.
The Offeror has received a financing commitment from HPS Investment Partners, LLC (on behalf of certain funds or accounts managed, advised or controlled by HPS Investment Partners, LLC) (collectively, "HPS Investment Partners") for an interest-bearing senior secured first lien term loan facility in an aggregate principal amount up to C$825 million, subject to the satisfaction and/or waiver of certain conditions, to complete the Proposed Offer and any subsequent compulsory acquisition or subsequent acquisition transaction, as applicable (the "Debt Financing").
The Proposed Offer will be made only for Common Shares and not for any (i) convertible securities of the Company, including the restricted share units ("RSUs") and performance share options of the Company ("PSOs", and together with the RSUs, "Convertible Securities"), or (ii) preferred shares of the Company. Holders of Convertible Securities may participate in the Proposed Offer by tendering any Common Shares acquired pursuant to the vesting and/or exercise, as applicable, of such securities in accordance with their terms prior to expiry of the Proposed Offer.
The Offeror believes that the Proposed Offer is compelling such that holders of Common Shares should accept the Proposed Offer, including for the following reasons:
- Significant Premium. The Proposed Offer represents (i) a 30.7% premium to the closing price of $8.61 per Common Share on January 6, 2023 (the last trading day prior to this announcement), and (ii) a 41.9% premium to the 20-day volume-weighted average price of $7.93 per Common Share on the Toronto Stock Exchange ("TSX") for the period ending on January 6, 2023.
- Liquidity and Certainty of Value. The Proposed Offer immediately crystalizes full and certain value by providing for 100% cash consideration for the Common Shares, giving depositing Shareholders certainty of value and immediate liquidity while removing financing, market, regulatory and execution risks to Shareholders.
- Support of Shareholders. Certain Shareholders have entered into the Lock-Up Agreements representing in the aggregate approximately 10.7% of the issued and outstanding Common Shares as of the date hereof, subject to certain terms and conditions of such agreements.
- Continuing Ownership by Current Management. Following completion of the Proposed Offer, the Offeror will be indirectly wholly owned by the CG Employee Group, none of whom is interested at this time in participating in any alternative transaction involving any sale of their interest in the Company or in any acquisition by a third party of the Company or any of its material assets. Accordingly, the Offeror does not anticipate that the Company will receive any competing proposal at or exceeding the Offer Price.
- Potential for Downward Impact to Common Share Price if Proposed Offer Not Accepted. If the Proposed Offer is not successful, and no other offer is made for the Company, the Offeror believes the Common Shares would trade below the Offer Price and would continue to trade in a way that reflects the inherent volatility of the global capital markets and the limited liquidity of the Common Shares.
- Fairness Opinion. Pursuant to an engagement letter between Raymond James and the Offeror, Raymond James Ltd. ("Raymond James") delivered to the Offeror an opinion (the "Raymond James Fairness Opinion") to the effect that, based upon and subject to the assumptions and limitations set forth therein and certain other considerations in connection with the preparation of the Raymond James Fairness Opinion, as of January 8, 2023, the consideration payable pursuant to the Proposed Offer is fair, from a financial point of view, to the Shareholders (other than the Offerors, their affiliates and joint actors).
- Fully Financed All-Cash Offer. The Proposed Offer is highly credible, as the Offeror will satisfy the funding requirements of the Proposed Offer pursuant to a fully committed debt financing described above.
Senior management and the employees of the Company and its subsidiaries have demonstrated an unwavering commitment to the Company and its stakeholders during their collective decades of service. Notwithstanding these efforts, the public markets place a low value on the business, given its exposure to a cyclical capital markets environment, something that has been magnified during the tumultuous 2022 in the capital markets and which is expected to continue while the Common Shares remain publicly traded.
In June 2022, the Company's Chief Executive Officer met with the Company's largest Shareholder (the "Major Shareholder") to discuss the Company's prospects as part of a routine dialogue. The Major Shareholder shared its concerns that the public markets and strategic buyers place a low value and P/E multiple on financial services businesses where a substantial portion of revenues and earnings are dependent on a cyclical capital markets business. Accordingly, in order to facilitate liquidity at an attractive premium, the Major Shareholder offered to support a going private transaction pursuant to which the Major Shareholder would sell its Common Shares to a management-led group.
Following the dialogue with the Major Shareholder, the Company's Chief Executive Officer engaged with the other members of the Company's executive leadership to consider whether there was interest in a management-led buyout and whether such a transaction might be feasible. Two principal themes emerged:
- executive leadership members were solely interested in considering a transaction as purchasers of the Company and, as Shareholders, were not prepared to sell to any third-party purchaser or entertain any offers in that regard; and
- executive leadership members, including as a result of the Major Shareholder's views, believed that pursuing an acquisition of all of the Common Shares that they did not already own was in the best interests of the Company and its stakeholders.
As a result of the previous conversations, in early August 2022, the executive leadership team submitted a confidential letter to the Company's board of directors ("Company Board"), outlining their desire to explore a possible management led buyout of the Company, reiterating the principle themes above.
The Company Board formed a special committee of independent directors (the "Special Committee") in August 2022, and in late September 2022 members of executive management entered into a non-disclosure and standstill agreement approved by the Special Committee that (i) allowed for the sharing of confidential information with prospective lenders in connection with a potential transaction, and (ii) permitted an offer at C$11.25 per Common Share to be made at any time.
After engaging with prospective lenders and the Special Committee and its financial and legal advisors, and considering feedback received from the Special Committee and its advisors regarding the most appropriate path for a proposed transaction, in early December 2022 executive leadership ultimately focused its efforts on pursuing a take-over bid at C$11.25 per Common Share, including negotiating the Debt Financing and engaging Raymond James to provide financial advice to the Offeror and prepare the Raymond James Fairness Opinion.
1394025 B.C. Ltd., a holding entity wholly-owned by Daniel Daviau and the sole shareholder of the Offeror ("Holdco"), the Offeror and the CG Employee Group entered into a co-bidding agreement dated as of the date hereof (the "Co-Bidding Agreement") in order to, among other things, facilitate the organization of Holdco and the Offeror, the making and structuring of the Proposed Offer and the post-closing governance of Holdco and the Offeror. Pursuant to the Co-Bidding Agreement, the parties have agreed to, among other things, make the Proposed Offer and use commercially reasonable efforts to consummate such other transactions such that the Offeror becomes the owner of all of the outstanding Common Shares. Completion of certain of the transactions contemplated by the Co-Bidding Agreement including, among others, the exchange of Common Shares (other than Non-Rollover Common Shares) held by the CG Employee Group for common shares in the capital of Holdco ("Holdco Shares"), are conditional upon and will occur, to the maximum extent possible, contemporaneously with the Offeror's first take-up of Common Shares under the Proposed Offer. In addition to the Co-Bidding Agreement, certain holders of shares in the capital stock of Canaccord Financial Group (Australia) Pty Ltd. ("CG AUS"), currently owned 65% by the Company and 35% by minority shareholders, have provided an irrevocable undertaking (the "CFGA Undertaking") in favour of Holdco and the Offeror pursuant to which the holders will, following the completion of a compulsory acquisition or subsequent acquisition transaction, accept an offer to acquire each share of CG AUS in exchange for 0.4227 of a Holdco Share, whereupon CG AUS will become wholly-owned by the Offeror.
Holdco and the Offeror are corporations incorporated in British Columbia. Currently, Holdco owns all of the outstanding shares of the Offeror and Daniel Daviau owns all of the outstanding shares of Holdco.
The CG Employee Group is comprised of Daniel Daviau, David Kassie (Chairman and director), Jeff Barlow (President, Canaccord Genuity LLC (US)), Patrick Burke (President, Capital Markets, Canaccord Genuity Corp. (Canada)), David Esfandi (Chief Executive Officer, Canaccord Genuity Wealth Management (UK & Europe)), Marcus Freeman (Chief Executive Officer, Canaccord Genuity Group (Asia-Pacific)), Fera Jeraj (Chief Technology Officer), Don MacFayden (Executive Vice President and Chief Financial Officer), Jason Melbourne (Global Head of Distribution), Jennifer Pardi (Global Head of Equity Capital Markets), Adrian Pelosi (Executive Vice President, Chief Risk Officer & Treasurer, Canaccord Genuity Group Inc.), Stuart Raftus (Executive Vice President and Chief Administrative Officer and President, Canaccord Genuity Wealth Management (Canada)), Nick Russell (Chief Executive Officer, Capital Markets Canaccord Genuity Limited (UK & Europe)), Andy Viles (Executive Vice President and Chief Legal Officer), Mark Whaling (Global Head of Securities) and additional senior employees, each of whom is an officer and/or employee of the Company and/or a subsidiary thereof. Subject to the receipt of the Requested Exemptive Relief (as defined below), the Offeror intends to approach certain officers and/or employees of the Company and/or its subsidiaries prior to expiry of the Proposed Offer to become additional Offerors ("Additional Co-Offerors") pursuant to the execution of joinders to the Co-Bidding Agreement. Each Additional Co-Offeror will, under the terms of the Co-Bidding Agreement, agree to exchange for Holdco Shares all Common Shares owned as of the date of this press release and any Common Shares acquired through ordinary course settlement of outstanding Convertible Securities after the date hereof and prior to expiry of the Proposed Offer.
Other than in certain circumstances described below, the Offerors intend to formally commence the Proposed Offer as soon as practicable by filing and mailing the take-over bid circular and accompanying documents in respect of the Proposed Offer (the "Offer Documents"). The Proposed Offer constitutes an "insider bid" under applicable Canadian securities laws and therefore cannot formally commence until a formal valuation, prepared by an independent valuator and supervised by a special committee of the Company's independent directors, is obtained. The Offerors have asked the Special Committee to obtain such formal valuation as soon as possible. Once formally commenced, the Proposed Offer will be open for acceptance by holders of Common Shares for 105 days, unless the Proposed Offer is extended, accelerated or withdrawn, in each case, in accordance with the conditions of the Proposed Offer and applicable law. The Raymond James Fairness Opinion does not constitute a formal valuation under applicable Canadian securities laws.
Offer Conditions
The Proposed Offer will be subject to certain conditions to be satisfied or, where permitted, waived by the Offeror at or prior to the expiry of the Proposed Offer, including, among other things, that: (i) the Common Shares validly deposited to the Proposed Offer, and not withdrawn, together with the Common Shares held by the Offeror or to be transferred to the Offeror pursuant to the Co-Bidding Agreement, represent at least 75% of the then-outstanding Common Shares (on a fully-diluted basis, excluding any Convertible Securities that do not vest and/or are not exercisable until after the 56th day following the first take-up of Common Shares under the Proposed Offer); (ii) none of the Lock-Up Agreements have been terminated in accordance with their terms; (iii) all governmental, regulatory and stock exchange approvals, including, among other things, the Requested Exemptive Relief (as defined below), approvals from domestic and international securities regulatory authorities and stock exchanges in all of the applicable jurisdictions in which the Company has presence and certain domestic or international merger and antitrust approvals including pursuant to the Competition Act (Canada), that the Offerors consider necessary or desirable in connection with the Proposed Offer or any compulsory acquisition or subsequent acquisition transaction shall have been obtained; (iv) all third party consents, approvals or waivers that the Offeror considers necessary or desirable in connection with the Proposed Offer and any compulsory acquisition or subsequent acquisition transaction shall have been obtained, including all consents, approvals or waivers required to complete the Proposed Offer and any compulsory acquisition or subsequent acquisition transaction from the lenders under the senior facilities agreement of Canaccord Genuity Wealth Group Holdings (Jersey) Limited dated September 29, 2021, as it may be amended, supplemented or restated from time to time (the "U.K. Credit Facility"); (v) all Convertible Securities shall have been exercised in accordance with their terms, or if not exercised, be adjustable in accordance with their terms at the sole discretion of the Company Board on terms satisfactory to the Offeror, provided that the Company Board shall not have caused the vesting of any outstanding equity awards to be accelerated and no Common Shares held by any of the employee benefit trusts administered by the Company or its subsidiaries thereof have been tendered to the Proposed Offer; (vi) there shall not exist any prohibition at Law against the Offeror from making the Proposed Offer or the Offeror, on behalf of itself and the CG Employee Group, taking up and paying for the Common Shares under the Proposed Offer or completing any compulsory acquisition or subsequent acquisition transaction; (vii) the Company shall not have adopted or implemented a shareholder rights plan, disposed of any material assets, incurred any material debts, commenced proceedings under the Companies' Creditors Arrangement Act (Canada) or the Bankruptcy and Insolvency Act (Canada), implemented any changes in its capital structure or otherwise implemented or attempted to implement a defensive tactic; (viii) no material adverse change or effect shall have occurred in the business, assets, liabilities, operations, capitalization, properties, condition (financial or otherwise), prospects or other affairs of the Company; (ix) there shall not be any action, proceeding, litigation or regulatory order in effect, pending or threatened that may make illegal, enjoin, prohibit, delay, restrict, make materially more costly or otherwise hamper the carrying out of the Proposed Offer and any compulsory acquisition or subsequent acquisition transaction; * the Offeror shall not have become aware of the Company having made any untrue statement of a material fact or omitting to state a material fact that is required to be made to any domestic or international securities regulatory authority or the New Self-Regulatory Organization (formerly the Investment Industry Regulatory Organization of Canada); (xi) no term or condition exists in a material contract or permit to which the Company is a party that, as a result of the transactions contemplated under the Proposed Offer and any compulsory acquisition or subsequent acquisition transaction, could result in the creation or acceleration of any material liability or other adverse impact; (xii) each member of the Company Board (other than David Kassie, Daniel Daviau and any other directors identified by the Offeror prior to expiry of the Proposed Offer) shall have resigned at or prior to expiry of the Proposed Offer, or tendered a resignation that automatically becomes effective as at the time of the first take-up or acquisition of the Common Shares by the Offeror pursuant to the Proposed Offer; and (xiii) the statutory minimum tender and other conditions set out in National Instrument 62-104 – Take-Over Bids and Issuer Bids (which cannot be waived) shall have been satisfied; (xiv) there shall not have been a failure to wind up Canaccord Genuity Wealth Group Holdings Ltd. into, or amalgamate Canaccord Genuity Wealth Group Holdings Ltd. with, the Company; (xv) the Offeror shall not have become aware, through any public announcement or otherwise, of any intention of Shareholders beneficially owning, in the aggregate, greater than 1% of the issued and outstanding Common Shares, to exercise dissent and appraisal rights in connection with any compulsory acquisition or subsequent acquisition transaction; and (xvi) other customary conditions and such other terms and conditions the Offeror considers advisable in the circumstances for a transaction of this nature shall have been satisfied.
Effects of the Proposed Offer and Subsequent Intentions of the Offeror
Following the first take-up of Common Shares under the Proposed Offer, it is expected that a reconstituted Company Board will take such actions as are necessary and permissible (i) to provide that the RSUs will, upon vesting, become entitled to be settled for Holdco Shares, (ii) exchange the limited number of PSOs that are expected to be outstanding for options to acquire Holdco Shares, and (iii) accelerate and vest the outstanding cash-settled executive employee deferred share units and performance share units of the Company, and to thereafter direct the after-tax cash proceeds payable upon the settlement of such cash-settled equity awards to Holdco as the aggregate subscription price of, and subscribe for, such number of Holdco Shares for a price equal to the Offer Price.
Following completion of the Proposed Offer, the Offeror intends to acquire any remaining Common Shares not acquired pursuant to the Proposed Offer pursuant to a compulsory acquisition or a subsequent acquisition transaction to be approved by the Shareholders at a special meeting of such Shareholders to be held within 55 days after completion of the Proposed Offer. Any such subsequent acquisition transaction, including an amalgamation, arrangement, consolidation or other acquisition transaction, would among other things, require the approval of at least 66⅔% of the votes cast by the holders of Common Shares and may require approval of a majority of the votes cast by holders of Common Shares other than the Offerors, their affiliates and joint actors (provided that, under applicable Canadian securities laws, Common Shares acquired under the Proposed Offer from holders that are not Offerors, their affiliates or joint actors will generally be eligible to be voted by the Offeror in respect of such majority approval).
If permitted by applicable laws, the Offeror intends to cause the Company to apply to delist the Common Shares from the TSX as soon as practicable after completion of the Proposed Offer and any compulsory acquisition or subsequent acquisition transaction. However, the Company's obligations as a reporting issuer under applicable Canadian securities laws will continue and the Company will remain a listed issuer subject to the rules and regulations of the TSX by virtue of its publicly listed preferred shares.
Full details of the Proposed Offer will be set out in the Offer Documents, which the Offeror expects to file with the Canadian securities regulatory authorities. This news release is not a substitute for the Offer Documents. Such documents are not currently available, but once available CANACCORD GENUITY SECURITY HOLDERS AND OTHER INTERESTED PARTIES ARE URGED TO READ THESE DOCUMENTS, ALL OTHER APPLICABLE DOCUMENTS AND ANY AMENDMENTS OR SUPPLEMENTS TO ANY SUCH DOCUMENTS WHEN THEY BECOME AVAILABLE, BECAUSE EACH WILL CONTAIN IMPORTANT INFORMATION ABOUT HOLDCO AND THE OFFERORS, THE COMPANY AND THE PROPOSED OFFER. Materials filed with the Canadian securities regulatory authorities will be available electronically without charge under the Company's profile at www.sedar.com.
The Proposed Offer will only be made pursuant to a formal offer and the Offer Documents. The Proposed Offer will not be made in, nor will deposits of securities be accepted from a person in, any jurisdiction in which the making or acceptance thereof would not be in compliance with the laws of such jurisdiction.
Readers are cautioned that the Offeror may determine not to make the Proposed Offer if: (i) the Company Board implements or attempts to implement defensive tactics in relation to the Proposed Offer; (ii) the Company Board determines to re-engage with the Offeror to negotiate the terms of a buyout transaction and the Company Board and the Offeror determine to undertake that transaction utilizing a structure other than a take-over bid, such as a plan of arrangement; (iii) a material adverse effect has occurred in respect of the business, affairs, prospects or assets of the Company prior to commencement of the Proposed Offer; or (iv) prior to the formal commencement of the Proposed Offer, any of the Proposed Offer conditions listed herein would be incapable of being satisfied. Accordingly, there can be no assurance that the Proposed Offer will be made or that the final terms of the Proposed Offer will be as set out in this press release.
Stikeman Elliott LLP is acting as legal advisor to the Offerors in respect of the Proposed Offer and Canadian legal matters in respect of the Debt Financing. Shearman & Sterling LLP is acting as legal advisor to the Offerors in respect of the Debt Financing. McCarthy Tétrault LLP and Kirkland & Ellis LLP are acting as Canadian and U.S. counsel, respectively, to HPS Investment Partners in connection with the Debt Financing.
This news release does not constitute an offer to buy or an invitation to sell, or a solicitation of an offer to sell or invitation to sell, any of the securities of Canaccord Genuity. Such an offer may only be made pursuant to offer and take-over bid circular filed with the securities regulatory authorities in Canada.
Holdco and the Offeror intend to apply to the applicable Canadian securities regulatory authorities for exemptive relief from certain provisions of National Instrument 62-104 – Take-Over Bids and Issuer Bids in relation to the Proposed Offer, the Co-Bidding Agreement, the CFGA Undertaking and certain transactions contemplated therein (the "Requested Exemptive Relief"). As noted above, it is a condition to the Proposed Offer that the Offeror receives the Requested Exemptive Relief.
This document contains "forward-looking statements" (as defined under applicable securities laws). These statements relate to future events or future performance and reflect management's expectations, beliefs, plans, estimates, intentions, and similar statements concerning anticipated future events, results, circumstances, performance or expectations that are not historical facts. Forward-looking statements include, but are not limited to, statements regarding: the Proposed Offer, including the anticipated timing, mechanics, funding, completion, settlement, results and effects of the Proposed Offer; the Offeror's objectives, strategies, intention, expectations and plans for Canaccord Genuity; the ability of the Offerors to complete the transactions contemplated by the Proposed Offer; reasons to accept the Proposed Offer and expectations that such reasons continue to be prevailing; the purpose of the Proposed Offer; expectations regarding the process for obtaining and the ability to obtain any required regulatory approvals or third party consents; intentions to delist the Common Shares; and the completion and effects of a compulsory acquisition, subsequent acquisition transaction or another alternative transaction; the availability of any exemptions under applicable securities laws, including the Requested Exemptive Relief and, if granted, the scope of and conditions to such relief; risks and challenges facing the Company including its forward-looking capital requirements; Additional Co-Offerors, if any, and the terms on which such Additional Co-Offerors will participate as an Offeror; and any other statements that are not material facts. Such forward-looking statements reflect the Offeror's current beliefs and are based on information currently available. In some cases, forward-looking statements can be identified by terminology such as "may", "will", "should", "expect", "plan", "anticipate", "believe", "estimate", "predict", "potential", "continue", "target", "intend", "could" or the negative of these terms or other comparable terminology.
By their very nature, forward-looking statements involve inherent risks and uncertainties, both general and specific, and a number of factors could cause actual events or results to differ materially from the results discussed in the forward-looking statements. In evaluating these statements, readers should specifically consider various factors that may cause actual results to differ materially from any forward-looking statement. These factors include, but are not limited to, market and general economic conditions (including slowing economic growth, inflation and rising interest rates), the dynamic nature of the financial services industry and the risks and uncertainties and the potential continued impacts of the coronavirus (COVID-19) pandemic on the Company's business operations and on the global economy, and the impact of the war in Ukraine and the resulting humanitarian crisis on the global economy, in particular its effect on global oil, agriculture and commodity markets.
Although the forward-looking information contained in this document is based upon what the Offeror believes are reasonable assumptions, there can be no assurance that actual results will be consistent with these forward-looking statements. The forward-looking statements contained in this document are made as of the date of this document and should not be relied upon as representing views as of any date subsequent to the date of this document. Except as may be required by applicable law, the Offeror does not undertake, and specifically disclaims, any obligation to update or revise any forward-looking information, whether as a result of new information, further developments or otherwise.
None of the Offerors, or any of their respective subsidiaries, affiliates, associates, officers, partners, employees, representatives and advisers, makes any representation or warranty, express or implied, as to the fairness, truth, fullness, accuracy or completeness of the information contained in this document or otherwise made available, nor as to the reasonableness of any assumption contained herein, and any liability therefore (including in respect of direct, indirect, consequential loss or damage) is expressly disclaimed. Nothing contained herein is, or shall be relied upon as, a promise or representation, whether as to the past or the future and no reliance, in whole or in part, should be placed on the fairness, accuracy, completeness or correctness of the information contained herein.
Immediately prior to the execution of the Co-Bidding Agreement, neither Holdco nor the Offeror owned or controlled Common Shares. Upon entry into the Co-Bidding Agreement, the Offerors collectively own or exercise control or direction over an aggregate of (i) 21,138,039 Common Shares, representing approximately 21.3% of the issued and outstanding Common Shares, and (ii) 5,575,339 RSUs and 4,987,000 PSOs, representing, together with the Common Shares owned by the Offerors or over which the Offeror's exercise control or direction, 30.3% of the Common Shares on a partially-diluted basis.
The Offeror intends to acquire all of the issued and outstanding Common Shares other than Common Shares owned by or on behalf of the Offerors or any of their affiliates or joint actors (excluding Common Shares elected to be tendered to the Proposed Offer, beneficially held by the CG Employee Group in a registered or other deferred profit sharing or savings plan, or otherwise issued and sold for the purposes of income taxes payable in connection with the settlement or exercise of share-settled equity awards (collectively, the "Non-Rollover Shares")). Subject to certain conditions, if a sufficient number of Common Shares are tendered and taken-up, the Offeror may choose to acquire the remaining Common Shares not tendered in the Proposed Offer through a compulsory acquisition or subsequent acquisition transaction.
An early warning report will be filed by the Offeror, on behalf of itself, Holdco and the CG Employee Group, in accordance with applicable securities laws and will be available on SEDAR at www.sedar.com or may be obtained directly from the Offeror upon request pursuant to the contact details below or from Christina Marinoff at 416 869-7293.
SOURCE 1373113 B.C. Ltd.
CG Employee Group, Email: [email protected], Website: www.CGEmployeeGroup.com
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