Redline Communications Announces Warrant Exercise

TORONTO, Nov. 12, 2012 /CNW/ - Redline Communications (www.rdlcom.com) Group Inc. (TSX: RDL - "Redline" or the "Company"), a leading provider of specialized broadband wireless solutions announced today certain non-insiders have exercised warrants to purchase 881,521 common shares of the Company.  The aggregate consideration to be received by the Company in connection with the exercise of these warrants is approximately of $3.68 million, of which $1.3 million has been received. The remaining $2.4 million is expected this week. 

Redline has also received preliminary indications that other non-insiders might be exercising their warrants shortly.  In addition, Redline has been informed that certain insiders would be exercising some of their warrants once the Company's blackout period has been lifted.  Assuming that all these additional warrants are exercised an additional 2,874,184 common shares would be issued for an additional aggregate consideration of approximately $9.99 million.

These warrants represent some of the "first warrants" and "second warrants" issued as part of the Company's private placement announced in April 2011.  The warrants have previously been reported in the Company's financial statements and management discussion and analysis and as a result, the total potential diluted common shares outstanding have not changed as a result of this warrant exercise.  The exercise price was $2.30 per share in the case of the first warrants and $4.60 per share in the case of the second warrants.

While the Company has no reason to believe that the additional warrants referred to above will not be exercised, until Redline has received all exercise forms and associated payments, there can be no assurance that they will.  The Company will provide additional information in due course.

About Redline Communications
Redline Communications (www.rdlcom.com) 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.

Many risks, uncertainties and other factors could cause the actual results of Redline to differ materially from the results, performance, achievements or developments expressed or implied by such forward-looking statements. These risks, uncertainties and other factors include but are not limited to the following: significant competition, competitive pricing practices, cautious capital spending by customers, industry consolidations, rapidly changing technologies, evolving industry standards, frequent new product introductions, short product life cycles and other trends and industry characteristics affecting the telecommunications industry; any material, adverse effects on Redline's performance if its expectations regarding market demand for particular products prove to be wrong; any negative developments associated with Redline's suppliers and contract manufacturing agreements including the Company's reliance on certain suppliers for key components; potential penalties, damages or cancelled customer contracts from failure to meet delivery and installation deadlines and any defects or errors in Redline's current or planned products; fluctuations in foreign currency exchange rates; potential higher operational and financial risks associated with Redline's efforts to expand internationally; a failure to protect Redline's intellectual property rights, or any adverse judgments or settlements arising out of disputes regarding intellectual property; changes in regulation of the wireless industry or other aspects of the industry; any failure to successfully operate or integrate strategic acquisitions, or failure to consummate or succeed with strategic alliances; and Redline's potential inability to attract or retain the personnel necessary to achieve its business objectives or to maintain an effective risk management strategy (collectively, the "Risks"). For additional information on these Risks, see Redline's most recently filed Annual Information Form ("AIF") and MD&A, which are available on SEDAR at www.sedar.com and on the Company's website at www.redlinecommunications.com. Redline assumes no obligation to update or revise any forward-looking statements or forward-looking information, whether as a result of new information, future events or otherwise, except as expressly required by law. All forward looking statements contained in this release are expressly qualified in their entirety by this cautionary statement. 

SOURCE: Redline Communications Group Inc.

REDLINE Contacts:   

Lynda Partner
Corporate Communications
[phone]
[email protected]

George Kypreos
Chief Financial Officer
+1.905.479.8344
[email protected]

Cory Pala
Investor Relations
[phone]
[email protected]