BAP Beacon Acquisition Partners

TORONTO, Jan. 13 /CNW/ -- TORONTO, Jan. 13 /CNW/ - Beacon Acquisition Partners Inc. (TSX Venture: BAP) ("Beacon"), a corporation listed on the TSX Venture Exchange (the "Exchange"), today announced the signing of a letter of intent (the "LOI") reflecting an agreement in principle to acquire all of the issued and outstanding shares of Waterford Investor Services, Inc. ("Waterford"), a United States broker-dealer investment firm, from AIC, Inc. and Frank J. Wainscott (collectively, the "Vendors"). The LOI calls for Beacon to issue a total of 4,321,697 common shares of Beacon ("Beacon Shares") at a deemed price of $0.25 per share ($1,080,424) as well as a 5 year promissory note in the amount of $255,000 (the "Note") in exchange for all the issued and outstanding shares of Waterford. The Beacon Shares will be split into two tranches, the first tranche of 2,176,000 Beacon Shares will be held in escrow and released to the Vendors and certain other parties in three equal annual installments commencing on January 1, 2012. The second tranche will also be released to the Vendors and certain other parties over three equal annual installments commencing on January 1, 2012 but are subject to a clawback by Beacon in the event that adverse claims against Waterford arise and result in a financial loss to Beacon during the first year following closing. The Note will bear no interest for the first year and afterwards will bear interest at a rate of 7% per annum. The Note will be convertible at the sole option of Beacon into Beacon Shares at a price of $0.25 per Beacon Share for the first 21 months after issuance. In addition, within one month of the closing of the transaction, Beacon will grant 175,000 options to purchase Beacon Shares for a period of three years to certain employees and contractors engaged by Waterford. Pricing of the options shall be determined at a later date. The options will vest in two tranches, half on January 1, 2012 and the other half on January 1, 2013. The transaction is subject to, among other things, satisfactory results of due diligence investigations of Waterford and the negotiation of definitive agreements. The transaction is an arm's length transaction and is subject to the approval of all applicable regulatory authorities, including the Exchange, the Financial Industry Regulatory Authority of the United States, the shareholders of the parties, if required, and other third parties as applicable. In addition, this transaction may result in AIC, Inc. becoming a control person of Beacon, as determined in accordance with the policies of the Exchange. Additional details regarding this issue will follow. About Waterford Investor Services, Inc. Waterford, established in 1998, is a full-service broker dealer headquartered in Richmond, Virginia. Waterford offers investment solutions for both retail and institutional clients with a full range of insurance and securities products. The firm has approximately 60 licensed professionals. Waterford is also a Registered Investment Advisory firm and has a diverse selection of money management options. Waterford's trades are cleared and customer accounts are held at RBC Correspondent Services, a division of RBC Capital Markets Corporation, one of the largest investment banking firms in North America. Strategic Rationale The principal business of Beacon is the ownership of all the issued and outstanding shares of American Beacon Partners, Inc. ("American Beacon"), a Wisconsin based broker-dealer. Upon completion of the acquisition of Waterford, Beacon anticipates merging the operations of Waterford and Beacon. This merger is expected to provide benefits for both Waterford and American Beacon. These benefits should include an ever increasing and broader range of products and services for investor clients, stronger operational support for financial advisors, and broader distribution for those small and mid-size companies wishing to access the capital markets. The transaction should strengthen Beacon's net capital position to facilitate well capitalized growth and finance improvements in the compliance and reporting systems of both Waterford and American Beacon. "We welcome the addition of a strong management and professional sales and trading team to our partnership. They have extensive industry experience across a number of disciplines," said Rob Mather, Chairman and CEO of Beacon. Jim Hintz, President and CEO of American Beacon noted that the combined firm will have in excess of 130 investment advisors licensed to do business in 45 states. "Both Beacon and Waterford exemplify the philosophy that the entrepreneurial spirit of the professional investment advisor combined with an open architecture of products and services, including alternatives, best meets the needs of today's investors.", commented Mr. Hintz. "We look forward to working with the professionals at American Beacon. The Beacon public company structure should allow us to attract and retain an increasing number of highly qualified full time investment advisors", said Roger Leibowitz, CFO of Waterford. Upon closing of the transaction, Mr. Roger Leibowitz and Mr. Chris Pollina will join the board of American Beacon. The TSX Venture Exchange Inc. has in no way passed upon the merits of the proposed transaction and has neither approved or disapproved the contents of this press release. The TSX Venture Exchange Inc. does not accept responsibility for the adequacy or accuracy of this release. To view this news release in HTML formatting, please use the following URL: http://www.newswire.ca/en/releases/archive/January2011/13/c2451.html pRobert P. Mather, Chairman & CEO  1-201-447-2486/p p align="justify"James A. Hintz, President & CFO 1- 715-552-2741/p

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