Carmanah Technologies Corporation (TSX:CMH) (“the Company” or
“Carmanah”) announces the following.
Effective today, Michael W. Sonnenfeldt has
announced his resignation as Chairman of the Board of
Directors.
“Just over four years ago, Michael Sonnenfeldt
joined our Board as Chairman,” said John Simmons, Chief Executive
Officer. “As Carmanah’s largest shareholder, Michael had a vision
that Carmanah could become a world class designer, manufacturer and
distributor of solar related infrastructure equipment that would
represent the most environmentally sensitive and best economic
alternative for our customers. From the beginning, he
provided the strategic guidance that allowed the transformation of
Carmanah from a company with a history of losses to one that is now
solidly profitable. In addition, Michael personally led a
much-needed recapitalization of the company and set the foundation
for the substantive growth in the Company’s market
capitalization. During his tenure, our share price has risen
from a low of 90 cents per share to a price, today, that is five
times that amount. Also during his tenure, our market
capitalization grew from below CAD $10 million and today exceeds
CAD $100 million. Lastly, Michael enabled Carmanah to set a new
strategic course. Within that context, we expanded to Europe
with our acquisition of the Sabik Group of Companies and to the
Pacific Region with our recent acquisition of New Zealand-based
Vega Industries Inc. Today Carmanah has more than $25 million in
cash and is consistently profitable. Our Telematics
initiative is a direct outgrowth of his creativity. Without
Michael’s dedication, it is highly unlikely that we would have
achieved all that we have. I want to thank him for his
contribution and wish him great success in his future
endeavours.”
“With all of the great progress the company has
made over the past four years, the recent successful sales of the
two power divisions will now allow a streamlined focus on
Carmanah’s Signalling and related Illumination and Telematics
opportunities,” Sonnenfeldt said. “I feel like my work is now
finished and I leave the company in great financial condition with
an outstanding leadership team. I feel fortunate to have
worked with John who, as CEO, has led the transformation. The
team he has built is immeasurably stronger than the one he
inherited. I have worked with Jim Meekison, who will replace me as
Chair and as largest shareholder. He will make an outstanding
Chairman, and the company is lucky to have him serve in that
capacity. I wish him and the entire team all the best.”
Recent Insider Transactions
Just prior to his resignation from the Board, entities
controlled by Mr. Sonnenfeldt sold 4,087,443 common shares of
Carmanah (“Shares”) to an entity controlled by Mr. Jim Meekison, a
director and insider of Carmanah for CAD $5.00 per Share, for an
aggregate purchase price of CAD $20,437,215. In addition,
entities controlled by Mr. Sonnenfeldt sold 117,808 Shares and
certain other shareholders sold 482,192 Shares to an entity
controlled by another director and insider of Carmanah, for
CAD$5.00 per Share, for an aggregate purchase price of
CAD$3,000,000 (the “Transactions”). Following the Transactions,
entities controlled by Mr. Sonnenfeldt’s still remain significant
shareholders of Carmanah, owning approximately 10.0% of the
company’s common shares, in the aggregate.
Jim Meekison to become Chairman
Mr. Sonnenfeldt’s successor Jim Meekison has agreed to serve as
Carmanah’s Board Chairman. His appointment dovetails with Mr.
Sonnenfeldt’s resignation.
“Jim Meekison has been a significant Carmanah
shareholder for more than three years,” said John Simmons. “His
increased shareholdings and preparedness to serve as chairman of
our board of directors signals his confidence in our business plan.
I look forward to working with him in his new role.”
Substantial Issuer Bid
Carmanah also announces that it intends to
launch a Substantial Issuer Bid (“SIB”) pursuant to which Carmanah
will offer to acquire up to 6.0 million Shares for CAD $5.00 per
Share from existing shareholders. Shares acquired through the
SIB will be cancelled and returned to treasury. Should more
than 6.0 million Shares be tendered into the SIB, Shares will be
acquired on a proportional basis from all tendering shareholders.
The SIB is expected to be launched imminently and remain in effect
for 35-days. Should all 6.0 million Shares be acquired through the
SIB, Carmanah will have approximately 18,645,250 Shares
outstanding.
Certain insiders intend to tender some of their
shareholdings into the SIB. These intentions will be disclosed in
the SIB offering document but will include the intention of an
entity controlled by Mr. Meekison to tender a portion of his Shares
to the extent that, after the effect of the SIB, Mr. Meekison hopes
that he will beneficially own approximately 25% of the issued and
outstanding Shares.
Early Warning Report
Information
Prior to the Transactions, Mr. Sonnenfeldt
owned, directly or indirectly, or exercised control or direction
over 6,675,462 Shares and 100,000 options to acquire Shares
(“Options”). After the completion of the Transactions, Mr.
Sonnenfeldt now owns, directly or indirectly, or exercises control
or direction over, 2,470,211 Shares and 100,000 Options. The
2,470,211 Shares represent approximately 10.0% of the total number
of issued and outstanding Shares.
Mr. Meekison acquired ownership of the 4,087,443
Shares through two private transactions (the “Acquisitions”) made
in reliance on the private agreement exemption set out in section
4.2 of National Instrument 62-104 Take-Over Bids and Issuer Bids.
The Acquisitions were completed through Trimin Capital Corp., an
entity controlled by Mr. Meekison, and located in Toronto,
Canada.
Prior to the Acquisitions, Mr. Meekison owned,
directly or indirectly, or exercised control or direction over
2,963,700 Shares and 100,000 options to acquire Shares (“Options”).
After the completion of the Acquisitions, Mr. Meekison now owns,
directly or indirectly, or exercises control or direction over,
7,051,143 Shares and 100,000 Options. The 7,051,143 Shares
represent approximately 28.6% of the total number of issued and
outstanding Shares.
Mr. Meekison’s acquisitions were made for
investment purposes. In addition to tendering Shares to the SIB, as
described above, Mr. Meekison may, in the future, increase or
decrease his beneficial ownership, control or direction over
securities of Carmanah.
About Carmanah Technologies
Corporation
Carmanah designs, develops and distributes a
portfolio of products focused on energy optimized LED solutions for
infrastructure. Since 1996, we have earned a global reputation for
delivering durable, dependable, efficient and cost-effective
solutions for industrial applications that perform in some of the
world’s harshest environments. We manage our business within two
reportable segments: Signals and Illumination. The Signals segment
serves the Airfield Ground Lighting, Aviation Obstruction, Offshore
Wind, Marine, Traffic and Telematics markets. The
Illumination segment provides solar powered LED outdoor lights for
municipal and commercial customers.
This release may contain forward-looking
statements. Often, but not always, forward-looking statements can
be identified by the use of words such as “expects,” “estimates,”
“could,” “will” or variations of such words and phrases.
Forward-looking statements or information in this news release
relate to, among other things: Carmanah’s intent to launch the SIB
and the intention of certain shareholders, including Mr. Meekison,
to tender Shares to the SIB. Forward-looking statements involve
known and unknown risks, uncertainties, and other factors which may
cause the actual results, performance, or achievements of Carmanah
to be materially different from any future results, performance, or
achievements expressed or implied by the forward-looking
statements. Such factors include, but are not limited to: our
ability to complete the SIB. These forward-looking statements are
based on management’s current expectations and beliefs but given
the uncertainties, assumptions and risks, readers are cautioned not
to place undue reliance on such forward-looking statements or
information. Carmanah disclaims any obligation to update, or to
publicly announce, any such statements, events or developments
except as required by law.
For additional information on these risks and
uncertainties, see Carmanah’s most recently filed Annual
Information Form (“AIF”) and Annual MD&A, which are available
on SEDAR at www.sedar.com and on the Company’s website at
www.carmanah.com. The risk factors identified in Carmanah’s AIF and
MD&A are not intended to represent a complete list of factors
that could affect Carmanah.
Contact
Carmanah Technologies Corporation:
Evan Brown, (250) 380-0052
Chief Financial Officer/Corporate Secretary
investors@carmanah.com