Ergoresearch to acquire Victhom
LAVAL, QC,
March 14, 2013 /CNW Telbec/ -
Ergoresearch Ltd. (TSXV: ERG) ("Ergoresearch") and Victhom
Human Bionics Inc. (TSXV: VHB) ("Victhom") announced today
that Ergoresearch Inc. (the "Purchaser"), a direct
wholly-owned subsidiary of Ergoresearch, and Victhom have entered
into a definitive arrangement agreement (the "Arrangement
Agreement") pursuant to which all of the outstanding securities
of Victhom will be acquired by the Purchaser. Under the terms of
the Arrangement Agreement, the total consideration is $4.1 million and existing holders of common
shares of Victhom will receive $0.08
in cash per share, the holders of the class A preferred shares of
Victhom will receive a cash amount equal to $2,556,188 divided by the number of issued and
outstanding series A preferred shares on closing of the
arrangement. There are currently 19,297,654 common shares and
6,479,131 Series A Preferred Shares of Victhom issued and
outstanding.
The all-cash consideration of $0.08 per common share represents a premium of
approximately 60% over the closing price of the common shares price
on the TSX Venture Exchange on March 13,
2013, 118.5% over the volume-weighted average trading price
of the common shares for the past 20 trading days. All stock
options granted and outstanding of Victhom will be cancelled
without consideration as none of these options will be "in the
money" given the cash consideration offered for the common
shares.
Normand Rivard,
President and Chief Executive Officer of Victhom, said: "We believe
that the proposed transaction is a favorable outcome for our
shareholders and we are pleased to see that our technology will be
held by a Québec-based company."
Shareholder Support
Victhom's four largest shareholders, Midsummer
Investment Ltd., Islandia LP, Fonds de solidarité des travailleurs
du Québec (F.T.Q.), SIPAR Inc. and all directors and officers of
Victhom who own securities of Victhom, holding as a group
approximately 23.61% of the outstanding common shares of Victhom
and approximately 93.06% of the outstanding preferred shares of
Victhom, have agreed, pursuant to support and voting agreements, to
support and vote in favour of the transaction. The support and
voting agreements will only terminate upon the termination of the
Arrangement Agreement.
Board Approves Unanimously
The transaction has been approved unanimously by
the Board of Directors of Victhom. In doing so, the Board of
Directors has determined that the arrangement is fair to the
shareholders and is in the best interests of Victhom and its
shareholders. As a result, the Board of Directors has authorized
the submission of the arrangement to the securityholders of Victhom
for their approval at a special meeting of securityholders and has
resolved to recommend to the shareholders that they vote in favour
of the transaction. In reviewing the proposed transaction, the
Board of Directors received an opinion from Bloom Burton & Co.
that the consideration to be received by all the shareholders under
the transaction is fair from a financial point of view to such
shareholders.
Transaction Terms
The transaction will be implemented by way of a
court-approved statutory plan of arrangement under the Canada
Business Corporations Act and will have to be approved by the
securityholders of Victhom at a special meeting to be held on or
about April 23, 2013. The plan of
arrangement will be subject to the approval of (i) 66 2/3% of the
votes cast by all of the holders of common shares of Victhom, (ii)
66 2/3% of the votes cast by all of the holders of class A
preferred shares of Victhom, and (iii) a simple majority of the
votes cast by all shareholders of Victhom, voting as a single
class, excluding interested parties. Once approved by the
securityholders, the plan of arrangement will then have to be
sanctioned by the Superior Court of Québec.
The transaction is subject to certain other
customary conditions described in the Arrangement Agreement,
including Victhom's compliance with covenants relating to its
operations until closing. The Arrangement Agreement contains
customary provisions prohibiting Victhom from soliciting any other
acquisition proposals and providing the Purchaser with a right to
match any unsolicited acquisition proposal from a third party that
the Board of Directors of Victhom determines, in the exercise of
its fiduciary duties, to be superior to the transaction
contemplated by the Arrangement Agreement. In the event that the
Purchaser does not match such a superior proposal, the Board of
Directors of Victhom will be entitled to change its recommendation
and the Purchaser will then have the option to either terminate the
Arrangement Agreement or force Victhom to hold the special meeting
of securityholders.
The Arrangement Agreement provides for Victhom
to pay the Purchaser a termination fee in the amount of
$300,000 and reimburse Purchaser's
out-of-pocket expenses under certain circumstances. The Arrangement
Agreement also provides for the Purchaser to pay Victhom a reverse
termination fee in the amount of $300,000 under certain circumstances.
A copy of Bloom Burton & Co.'s fairness
opinion, a description of the various factors considered by the
Board of Directors in its decision to approve the transaction and
recommend it to the securityholders, as well as other relevant
background information, will be included in the information
circular to be mailed to the securityholders of Victhom in advance
of the special meeting to vote on the plan of arrangement. Copies
of the information circular, the Arrangement Agreement, the plan of
arrangement, the support and voting agreements and certain related
documents will be filed with Canadian securities regulators and
will be available on SEDAR (www.sedar.com) as part of
Ergoresearch's and Victhom's public filings.
McCarthy Tétrault LLP is acting as legal counsel
to Victhom and Fasken Martineau DuMoulin LLP is acting as legal
counsel to the Purchaser and Ergoresearch.
Financing
Ergoresearch also announced that the Purchaser
has accepted an offer from Caisse Desjardins for a credit facility
of $7.2 million, the proceeds of
which will be used in part to finance the transaction with
Victhom.
This is not an invitation to purchase
securities listed on TSX Venture Exchange. TMX Group and its
affiliates do not endorse or recommend the referenced securities.
Please seek professional advice to evaluate specific
securities.
Forward-Looking Statements
This press release contains forward-looking
statements relating to the proposed acquisition of Victhom.
Statements based on Ergoresearch's, the Purchaser's and Victhom's
management's current expectations contain known and unknown
inherent risks and uncertainties and no assurance can be given that
potential future results or circumstances will be achieved or will
occur. The reader should not place undue faith in forward-looking
information. Management disclaims any intention or obligation to
update or revise any forward-looking statements whether as a result
of new information, future events or circumstances.
About Ergoresearch
Ergoresearch has developed Quebec's leading network of orthotics clinics,
with over 100 corporate and satellite centres under the Clinique du
pied Équilibre, Orthoconcept, Podotech and Laboratoire Langelier
banners. The leading manufacturer of "intelligent" foot orthotics
and specialty orthotics, it is a trend-setter in creating durable
medical equipment and software for the orthopedics market.
Ergoresearch has developed and commercialized Expert-Fit™, the
first robotized custom-fit orthotics manufacturing software
program, launched the first Living Lab in Canada and more recently, a new generation of
world-patented orthotic device called the OdrA, that revolutionizes
the treatment of pain associated with knee osteoarthritis.
Ergoresearch Ltd is listed on the Toronto Stock Exchange (TSXV)
under the symbol ERG.
About Victhom
Victhom is a company which owns patents in the
field of orthotics and prosthetics ("O&P"), including
intellectual property used in the POWER KNEE, the world's first and
only motor-powered prosthesis for above-knee amputees, a product
distributed under license agreement by Ossur, a global leader in
the O&P market. The Company also has a royalty agreement
related to the Neurostep® System and neuromodulation products in
other indications (sleep apnea and epilepsy) using the Neurobionix
technology platform under development by Neurostream Technologies,
a General Partnership now owned by Otto
Bock, a global leader in the O&P market.
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 VICTHOM HUMAN BIONICS INC.