Redline Communications Announces Closing of $10 Million Bought Deal Private Placement

TORONTO, July 30, 2013 /CNW/ - Redline Communications Group Inc. (the "Company") (www.rdlcom.com) (TSX: RDL), a leading provider of broadband wireless solutions for machine-to-machine (M2M) communications, is pleased to announce that it has closed the previously announced private placement of an aggregate of 1,769,083 units (the "Units") at a price of $6.00 per Unit for total gross proceeds of $10,614,498 (the "Offering"). Each Unit consisted of one common share of the Company and one half of one common share purchase warrant, with each whole common share purchase warrant being exercisable for one common share at an exercise price of $8.00 until July 30, 2015.

The Offering was conducted through a syndicate of underwriters led by Cantor Fitzgerald Canada Corporation and including Cormark Securities Inc., Byron Capital Markets Ltd., Canaccord Genuity Corp. and Stifel Nicolaus Canada Inc. (collectively, the "Underwriters").

Pursuant to the terms of an underwriting agreement dated July 30, 2013 entered into among the Company and the Underwriters, the Company (i) paid an aggregate cash commission to the Underwriters in the amount of approximately $636,870, and (ii) granted an aggregate of 106,145 compensation options to the Underwriters, with each compensation option being exercisable for one common share at an exercise price of $6.00 until January 30, 2015.

The net proceeds from the Offering will be used by the Company to assist in the implementation of the Company's growth strategy including product development, working capital and general corporate purposes.

All securities issued pursuant to the Offering are subject to a statutory four-month hold period in accordance with Canadian securities legislation.

This news release does not constitute an offer to sell or a solicitation of an offer to buy any of the securities in the United States.  The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act") or any state securities laws and may not be offered or sold within the United States or to U.S. persons unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.

Four insiders participated in the Offering, thereby making the Offering a "related party transaction" as defined under Multilateral Instrument 61-101 - Protection of Minority Security Holders in Special Transactions ("MI 61-101"):

Name	Title	Units Purchased under Private Placement	Common Shares Owned or Controlled After Private Placement
Mario Belanger	Chief Operating Officer	20,000	20,000
Eric Demerian	Director	25,000	25,000
George Kypreos	Chief Financial Officer	6,700	6,700
Robert Williams	President, Middle East and North Africa	8,333	42,196

The Offering was unanimously approved by the directors of the Company. The Offering was exempt from the formal valuation and minority shareholder approval requirements of MI 61-101 as neither the fair market value of any common shares issued to or the consideration paid by the aforementioned insiders exceeded 25% of the Company's market capitalization.

About Redline Communications

Redline Communications (www.rdlcom.com) is the innovator of Virtual Fiber™, a specialized wireless broadband system used by companies and governments worldwide to cost-effectively deploy distributed services and applications.  Redline Virtual Fiber™ solutions are used to facilitate and enhance public safety networks, deploy and extend secure networks, connect digital oil fields and smart grids, and bring dedicated Internet access wherever and whenever it's needed. Redline has been delivering powerful, versatile and reliable wireless systems to governments, the military, oil and gas, and the telecom industry for over a decade through its global network of certified partners. For more information visit www.rdlcom.com.

Forward Looking Statements

Certain statements in this release may constitute forward-looking statements or forward-looking information within the meaning of applicable securities laws. In some cases, forward-looking statements can be identified by terms such as "could", "expect", "may", "will", "anticipate", "believe", "intend", "estimate", "plan", "potential", "project" or other expressions concerning matters that are not historical facts. Readers are cautioned not to place undue reliance upon any such forward-looking statements.

Such forward-looking statements are not promises or guarantees of future performance and involve both known and unknown risks and uncertainties that may cause the actual results, performance, achievements or developments of Redline to differ materially from the results, performance, achievements or developments expressed or implied by such forward-looking statements. Forward-looking statements, by their nature, are based on certain assumptions regarding expected growth, management's current plans, estimates, projections, beliefs, opinions and business prospects and opportunities (collectively, the "Assumptions"). While the Company considers these Assumptions to be reasonable, based on the information currently available, they may prove to be incorrect. 

 

 

SOURCE: Redline Communications Group Inc.

Redline Contact(s)

Communications
Lynda Partner, Chief Communications Officer
[phone]
[email protected]

Financial
George Kypreos, CFO
+1.905.479.8344
[email protected]

Investor Relations
Cory Pala
[phone]
[email protected]

Twitter: @rdlcom
Press Kit: http://redline.mobilitypr.com