OTTAWA, ON, Oct. 26, 2021 /CNW/ - Enablence Technologies Inc.
("Enablence" or the "Company") (TSXV: ENA), a
supplier of optical components and subsystems, is pleased to
announce the results of its annual and special shareholders'
meeting held earlier today (the "Meeting"). At the Meeting,
all of the resolutions described in the management information
circular of the Company dated September 21,
2021 (the "Circular"), were approved by shareholders
of the Company, including the requisite shareholder approvals of
the Recapitalization Transaction (as defined below) as well as: (i)
the adoption of the Omnibus Equity Incentive Plan (as defined
in the Circular); (ii) the election of the director nominees
described in the Circular (being Mr. Derek
H. Burney, Mr. Louis De Jong
and Mr. Dan Shmitt); and (iii)
the re-appointment of MNP LLP as auditor of the Company.
Update on Recapitalization Transaction
At the Meeting, the Company obtained the requisite shareholder
approvals to, among other things, complete the recapitalization
transaction as more particularly described in the Circular (the
"Recapitalization Transaction"), including: (i) the
consolidation of the outstanding common shares of the Company (the
"Common Shares") on the basis of one post-consolidation
Common Share in exchange for a number of pre-consolidation Common
Shares within a range of fifty (50) to two-hundred (200), as may be
determined by the Board of Directors at a future date; (ii) the
creation of Mr. Dan Bordessa
together with Ms. Maria Semenko as a
new "control person" of the Company resulting from the issuance of
Common Shares to them under the terms of the Shares-for-Debt
Settlement (as defined below) and Shares-for-Services Settlement
(as defined in the Circular); (iii) the creation of Vortex ENA LP,
Paradigm Capital Inc., Paradigm Capital Partners Limited and Mr.
David Roland, collectively, as a
potential new "control person" of the Company; (iv) the
minority or disinterested approvals required for certain
share-for-debt settlements ("Shares-for-Debt Settlements")
required by the policies of the TSX Venture Exchange and/or
Multilateral Instrument 61-101 – Protection of Minority Security
Holders in Special Transactions.
As described in the Circular, the Company entered into
agreements providing for Shares-for-Debt Settlements with creditors
holding an aggregate of $41,397,844.11 (plus up to $3,000,000.00 of additional debt under the Grid
Note as described in the Circular) of the total unsecured debt of
the Company (collectively, the "Committed Shares-for-Debt
Settlements"), pursuant to which all of the unsecured debt owed
by the Company to such creditors will be settled in exchange for
the issuance of either: (i) Common Shares at a deemed price of
$0.025 per Common Share (the
"Recap Price"); or (ii) units of the Company
("Units") at a deemed price equal to the Recap Price for 80%
of the amount of the debt (with the remaining 20% of the debt being
extinguished for no consideration), with each Unit comprising one
Common Share and one-fifth (1/5th) of one common share
purchase warrant (each whole warrant, a "Warrant"), at the
creditor's election and subject to the policies of the TSXV. Each
full Warrant will entitle the holder thereof to purchase one Common
Share at a price of $0.03 per share
for a period of 36 months following the closing date of the
Recapitalization Transaction.
Also as described in the Circular, the Company has made an offer
to certain remaining unsecured debtholders of the Company holding
an aggregate of $1,955,863.59 in
unsecured debt (the "Remaining Debt"). The holders of the
Remaining Debt have not agreed to a Shares-for-Debt Settlement with
the Company, and it is a condition in favour of certain major
holders of Committed Shares-for-Debt Settlements that 100% of the
Remaining Debt enter into an agreement with the Company to convert
such Remaining Debt on the same terms as the Committed
Shares-for-Debt Settlements noted above (the "Closing
Condition").
In the event any of the holders of the Remaining Debt do not
enter into an agreement with the Company to convert such Remaining
Debt as described above, the Company intends to seek a waiver of
the Closing Condition from the required major holders of Committed
Shares-for-Debt Settlements. As of the date hereof, the Company has
held multiple discussions with such major creditors whose waiver
will be required, and these discussions are ongoing.
About Enablence Technologies Inc.
Enablence is a publicly traded company that designs,
manufactures and sells optical components and subsystems to a
global customer base. It utilizes its patented technologies,
including planar lightwave circuit intellectual property, in the
production of an array of photonic components and broadband
subsystems that deliver a key portion of the infrastructure for
current and next-generation telecommunication systems. The
Company's components are key elements in large optical network
infrastructure builds which enable global networking and
large-scale computing for businesses and individuals, including
data centers and 5G telecommunications networks. For more
information, visit www.enablence.com.
Forward-looking Statements
This news release contains forward-looking statements regarding
the Company based on current expectations and assumptions of
management, which involve known and unknown risks and uncertainties
associated with our business and the economic environment in which
the business operates. All such statements are forward-looking
statements under applicable Canadian securities legislation. Any
statements contained herein that are not statements of historical
facts may be deemed to be forward-looking statements. In
particular, this news release contains forward-looking statements
pertaining to the timing and ability of the Company to complete the
Recapitalization Transaction, if at all; the ability of the
Company to complete the Recapitalization on the terms announced, or
at all; the ability of the Company to obtain shareholder and
regulatory approvals of the
Recapitalization Transaction and ancillary
matters; the use of funds expected to be made available as a
result of the Recapitalization Transaction (if any); reduction
in the debt burden; and the consolidation of Common Shares. By
their nature, forward-looking statements require us to make
assumptions. Assumptions are based in part on the future capital
expenditure levels, the ability to fulfill all conditions precedent
to the closing of the Recapitalization Transaction, the
ability to secure regulatory approval and the ability to secure
shareholder approval. These statements are based on current
expectations that involve several risks and uncertainties which
could cause actual results to differ from those anticipated. These
risks include, but are not limited to, risks relating to the
Company failing to obtain the requisite shareholder and regulatory
approvals of the Recapitalization Transaction and ancillary
matters; the remaining debtholders declining to convert their
Remaining Debt on the same terms as the Shares-for-Debt Settlement,
which may give rise to termination rights; the terms as described
hereof may be amended following the date hereof; the impact of
the evolving COVID-19 pandemic on the Company's business,
operations and sales; uncertainties relating to the ultimate
spread, severity and duration of COVID-19 and related adverse
effects on the economies and financial markets of countries in
which the Company operates; and the ability of the Company to
successfully implement its business continuity plans with respect
to the COVID-19 pandemic. Although the Company believes that the
expectations reflected in the forward looking statements contained
in this news release, and the assumptions on which such
forward-looking statements are made, are reasonable, there can be
no assurance that such expectations will prove to be correct. We
caution our readers of this news release not to place undue
reliance on our forward-looking statements as a number of factors
could cause actual results or conditions to differ materially from
current expectations. Additional information on these and other
factors that could affect the Company's operations are set forth in
the Company's continuous disclosure documents that can be found on
SEDAR (www.sedar.com) under Enablence's issuer profile. Enablence
does not intend, and disclaims any obligation, except as required
by law, to update or revise any forward-looking statements whether
as a result of new information, future events or otherwise.
Neither TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release.
SOURCE Enablence Technologies Inc.
