This press release is issued pursuant to Multilateral
Instrument 62-104 - Take-Over Bids and Issuer Bids and National
Instrument 62-103 - The Early Warning System and Related Take-Over
Bid and Insider Reporting Issues in connection with the filing of
an early warning report dated October 8,
2020
EDMONTON, AB, Oct. 8, 2020 /CNW/ - Concerned shareholders
(the "Concerned Shareholders") of Rifco Inc.
("Rifco") (TSXV: RFC), led by 933672 Alberta Ltd.,
Tim Peterson, Ruth Peterson, Sorbrick Capital Corp., 812787
Alberta Ltd., Big Country Holdings Ltd., Norman Storch and Jeffrey Newhouse, announced today four director
nominees that the Concerned Shareholders intend to propose for
election to the board of directors of Rifco at the company's annual
general and special meeting of shareholders to be held on
Friday, December 11, 2020 (the
"Meeting").
Principal Concerns
The Concerned Shareholders, which currently exercise control or
direction over an aggregate of 9,132,582 common shares in the
capital of Rifco ("Common Shares") (representing
approximately 42,29% of the 21,597,483 outstanding Common Shares),
believe that the current board of directors and management have
underachieved in making strategic decisions that maximize
shareholder value and are consistent with the best interests of
Rifco. The Concerned Shareholders are confident about the merit,
quality and value potential of Rifco's but believe that new
leadership is required to bring better decision–making on strategic
matters and to oversee management in improved operational
efficiencies. As significant shareholders, the Concerned
Shareholders have a vested interest in seeing these improvements
realized.
The Concerned Shareholders have written to the current board of
directors of Rifco Inc. reminding them of their fiduciary duties to
all shareholders and warning them against entrenchment tactics in
light of the proposed nominees. The Concerned Shareholders strongly
cautioned the current board against taking any ill-considered
actions including, issuing shares or other dilutive securities that
could further entrench the board of directors or undertaking any
material transaction that could dilute current shareholders or
cause a material effect on the value of Rifco without a vote of
shareholders.
The Concerned Shareholders are hopeful that, following the
Meeting, a reconstituted board of directors comprised of the
Concerned Shareholders' nominees will focus on thoroughly improving
operational efficiencies as well as canvassing and evaluating
strategic opportunities that are in the best interests of Rifco and
its shareholders.
Names of the Concerned Shareholders' Director
Nominees
At the Meeting, shareholders will be asked to vote on, among
other things, the election of directors. The Concerned Shareholders
are proposing a new slate of nominees to the board of directors of
Rifco that will bring a fresh perspective and a decisive plan for
capitalizing on value-creating opportunities for Rifco and its
shareholders.
The Concerned Shareholders' replacement director nominees are
Jared Priestner, Tim Peterson, Jeffrey
Newhouse and Sean Aylward,
each of whom is highly-qualified and well-known in the business
community. Their backgrounds and relevant qualifications are set
forth below under the heading "Relevant Qualifications of the
Concerned Shareholders' Director Nominees".
Relevant Qualifications of the Concerned Shareholders'
Director Nominees
Jared Priestner, CEO of Go
Auto
Jared is a veteran of the automotive industry; growing up in a
family in which the car business ran through their veins. Jared
oversees the Go Auto conglomerate of dealerships that started in
1996 at his father's Edmonton Kentwood Ford dealership. Jared took
leadership as President in 2007 and CEO in 2015. Jared brings a
depth of automotive and leadership experience to the Company,
overseeing more than 45 dealerships, that in 2019 generated
revenues in excess of $3.0 billion;
selling more than 50,000 vehicles. He has driven industry leading
initiatives, having been the first to market with many of the
customer benefits now seen as standard, including vehicle history
reports, free lifetime engine warranties, and the elimination of
documentation fees. Under Jared, Go Auto has seen the acquisition
and integration of over 30 dealerships as well as expansion into
complementary businesses, including automotive finance, insurance
brokerage and real estate development.
Mr. Priestner, directly or indirectly, exercises control or
direction over 3,909,824 Common Shares.
Tim Peterson, Chairman
& CEO, Sorbrick Capital Corporation
Tim is a seasoned entrepreneur, opening his first retail
location in 1983. In 2001 Tim successfully merged within The Brick
network and continues to be involved to this day. Tim has been a
long-time shareholder of Rifco, first acquiring shares of the
Company during its inception in 2001. Tim's devotes a significant
portion of his time to humanitarian causes, currently serving on
the board of directors of Haitian Children's Aid Society.
Mr. Peterson, directly or indirectly, exercises control or
direction over 3,500,758 Common Shares.
Jeffrey Newhouse, CPA, CA,
MTax, CFP, 310S (Lvl II – Appr) - Chairman & CEO of Canadian
Auto Repair Holdings Inc.
Jeffrey is known for his entrepreneurial abilities, innovative
financial solutions, proven leadership skills and commitment to
enhancing business growth and profitability. A Chartered
Professional Accountant, Certified Financial Planner, and expert on
Canadian income tax law, holding a master's degree in this
discipline, Jeffrey's true passion lies in Canada's automotive industry. Jeffrey is
currently pursuing his Professional Automotive Technician
certification with the Ontario
College of Trades. Prior to co-founding Canadian Auto Repair
Holdings in 2016, Jeffrey was President & CEO of CTL
Corp. CTL was started in August
2010 out of the accounting office of Newhouse Rusin LLP.
Over the next 5 years, CTL would grow into the largest
privately-owned auto finance company serving non-prime credit
consumers across Canada. In 2015, CTL was acquired by
Industrial Alliance (IAG:TSX) and has grown to become the 3rd
largest non-prime auto finance company in Canada operating under the brand iA Auto
Finance. Last year they surpassed $1
Billion in their portfolio up from $150,000,000 at the time of sale.
Mr. Newhouse, directly or indirectly, exercises control or
direction over 532,000 Common Shares.
Sean Aylward, LL.B,
LL.M, Managing Director, FCT Holdings Inc.
Sean is a seasoned entrepreneur and currently the Managing
Director of a privately held company that is involved in early
stage investments in enterprises including specialty finance and
lending, real estate, agricultural technologies and IPTV. He serves
a board member and adviser to numerous private companies. Prior to
his business career he was a senior Partner in the Tax Department
of Osler Hoskin & Harcourt LLP,
primarily focused on commodity taxation, customs and related
cross-border matters. Sean co-owned and served as a Director
of Riverfront Medical Services, at the time one of Canada's largest privately owned third party
medical assessment companies. Sean graduated with a B.A. from
the University of Ottawa in 1982. He
obtained his LL.B. from Osgoode Hall Law School in 1985 and his
LL.M. from the London School of
Economics in 1988. Sean is a member of the Law Society of
Ontario..
Messrs. Priestner and Peterson are long-time shareholders of
Rifco and their respective acquisition and dispositions of Common
Share have been previously reported on the System for Electronic
Disclosure by Insiders (SEDI) at www.sedi.ca. Mr. Storch is
also a long-term shareholder of Rifco and acquired the 1,190,000
Common Shares that he currently holds through participation in
previous Rifco financings and various transactions on the secondary
market. Mr. Newhouse previously acquired the 532,000
Common Shares that he currently holds through various transactions
on the secondary market.
The Concerned Shareholders believe in the significant potential
of Rifco. In order to maximize this potential, however, the
leadership of Rifco must, among other things: be more ambitious
with its goals and vision for the company; and demonstrate a
greater willingness to solicit, procure, consider and explore all
proposals and corporate opportunities, with a view towards
advancing Rifco's business and maximizing shareholder returns.
This press release does not constitute a solicitation of
proxies, and is being issued in accordance with the "early warning"
requirements under applicable Canadian securities laws. Each of the
Concerned Shareholders may, and reserves the right to, acquire or
dispose of securities of Rifco as circumstances warrant; and is
carefully considering all legal options and remedies available to
it as a shareholder of Rifco.
The Concerned Shareholders are not soliciting proxies in
connection with the Meeting at this time. The Concerned
Shareholders have retained Shorecrest Group Ltd.
("Shorecrest") as it strategic shareholder communications
and proxy advisor. Shorecrest's responsibility will include
providing strategic advice and advising the concerned shareholders
with respect to the Meeting and proxy protocol. Shorecrest's
responsibilities will also include soliciting shareholders should
the Concerned Shareholders commence a formal solicitation of
proxies.
The above-referenced early warning report relating to this press
release has been filed on System for Electronic Document Analysis
and Review (SEDAR) at www.sedar.com under Rifco's issuer
profile.
SOURCE Concerned Shareholders of RIFCO INC.