EDMONTON, ALBERTA–(Marketwired – July 28, 2014) –
THIS PRESS RELEASE IS NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES.
Serenic Corporation (TSX VENTURE:SER) (“Serenic” or the “Company”) is pleased to report that all resolutions tabled for its special and annual general meeting of the Serenic shareholders (“Shareholders”) held on July 22, 2014 (the “Meeting”) have passed. Approximately 75% of the eligible voting shares of the Company were voted, of which approximately 87% were voted in favor of all of the resolutions that were proposed, including the special resolution to sell the shares of the wholly-owned Serenic operating subsidiaries: Serenic Canada Inc., Serenic Software, Inc. and Serenic Software (EMEA) Limited (collectively the “Subsidiaries”) to Sylogist Ltd. (the “Transaction”). The Subsidiaries have conducted virtually all of Serenic’s business to date and own Serenic’s existing proprietary enterprise application software, associated customer contracts and relationships, other related third party agreements, rights to the Serenic brand, and certain tax pools.
The current board, comprised of Dwayne Kushniruk, Randy Keith, Doug Thomson and Ron Odynski were re-elected to the Company’s board of directors.
The Company further announces that the Transaction was finalized and closed on July 28, 2014, in accordance with the terms outlined in the Share Purchase Agreement that was filed on SEDAR on July 2, 2014. Sylogist Ltd. has paid approximately $7.9 million (CDN) cash consideration and has assumed Serenic’s net working capital liability of approximately $3.7 million (CDN) (which excludes the Company’s existing cash on deposit) for 100% of the shares of the Subsidiaries, subject to final closing adjustments. The Company has received final acceptance from the TSX Venture Exchange for closing the Transaction.
The Shareholders also approved the other special resolutions that were tabled at the Meeting, including approval for the directors to change the name of Serenic Corporation, and to proceed with the distribution of a return of capital and a special dividend to Shareholders estimated to total in aggregate $0.45 per share on a fully diluted basis, subject to finalization of closing adjustments, taxes and costs which was described in the Information Circular dated June 26, 2014 that was distributed to the shareholders. A further press release will be issued with respect to the timing and procedure of the cash distributions with such distributions expected to occur within the next 60 days.
The Company will continue to be listed on the TSX Venture Exchange and will operate post-closing under the name of OneSoft Solutions Inc. The Company has further established two new wholly-owned subsidiaries, Cloudco Solutions Inc., based in Canada and OneCloudco Limited, based in the US, (collectively the “Cloudcos”), which have retained the existing intellectual property associated with the Company’s cloud technology and products, and which will operate the cloud businesses within Canada and the United States, respectively.
The balance of funds, estimated to be approximately $2.0 million (CDN) after payment of Transaction and closing costs, income taxes and cash distributions to shareholders, will be retained in the Company to fund further development of the succeeding Cloudcos’ business. The Cloudcos’ technology enables software applications based on Microsoft’s Dynamics NAV ERP and CRM platforms to be optimized for use on Microsoft’s new cloud technology platform. The Cloudcos have entered into an OEM arrangement with the Subsidiaries whereby the Cloudcos will re-brand and market products to new customer segments that the Subsidiaries have not historically pursued.
“We are delighted the Transaction with Sylogist Ltd. has been finalized,” stated Dwayne Kushniruk, Chairman. “We believe the Transaction provides shareholders with a fair value for the operating businesses that we have developed and nurtured for the past decade, while still providing shareholders the choice and opportunity to remain involved to potentially leverage upon our past investments and efforts to develop the new cloud strategies. Our first priority post-closing will be to reorganize the Cloudcos’ businesses, firstly working collaboratively with Sylogist Ltd. and the Subsidiaries to pursue new opportunities within the large segments of Not For Profit markets that we have historically not addressed; and secondly, to investigate opportunities to leverage our cloud technology and strategies with other vendors within the Microsoft ERP eco-system. We intend to provide more information regarding the future cloud strategies in due course.”
Prior to the Meeting, the Company received a notice of dissent from one minority shareholder. The Company addressed this issue in the best interest of all Shareholders pursuant to the provisions of section 191 of the Business Corporations Act (Alberta), by acquiring the dissenting shareholder’s shares at a fair value that was agreed to between the parties, and elected to close the Transaction notwithstanding the dissent. These shares will be returned to treasury and cancelled.
This news release contains forward-looking statements relating to the future operations and profitability of the Company and other statements that are not historical facts. Forward-looking statements are often identified by terms such as “may”, “should”, “anticipate”, “expects”, “believe”, “will”, “intends”, “plans” and similar expressions. Any statements that are contained in this news release that are not statements of historical fact may be deemed to be forward-looking statements. More particularly and without limitation, this press release contains forward-looking information concerning: the anticipated benefits of the Transaction to the Company and its shareholders, including anticipated synergies. Such forward-looking information is provided for the purpose of providing information about management’s current expectations and plans relating to the future. Investors are cautioned that reliance on such information may not be appropriate for other purposes, such as making investment decisions. In respect of the forward-looking information and statements concerning the anticipated benefits of the Transaction, the Company has provided such in reliance on certain assumptions that it believes are reasonable at this time, including expectations and assumptions concerning, among other things: interest and foreign exchange rates; planned synergies, capital efficiencies and cost-savings; applicable tax laws; the sufficiency of budgeted capital expenditures in carrying out planned activities; the availability and cost of labour and services; the success of growth projects; future operating costs; that counterparties to material agreements will continue to perform in a timely manner; that there are no unforeseen events preventing the performance of contracts; and that there are no unforeseen material development or other costs related to current growth projects or current operations. Accordingly, readers should not place undue reliance on the forward-looking information contained in this press release.
Since forward-looking information addresses future events and conditions, such information by its very nature involves inherent risks and uncertainties. Actual results could differ materially from those currently anticipated due to a number of factors and risks. These include, but are not limited to the risks associated with the industries in which the Company operates in general such as: costs and expenses; interest rate and exchange rate fluctuations; competition; failure to realize the anticipated benefits of the Transaction; ability to access sufficient capital from internal and external sources; and changes in legislation, including but not limited to tax laws.
Readers are cautioned that the foregoing list of factors is not exhaustive. Forward-looking statements contained in this news release are expressly qualified by this cautionary statement. The forward-looking statements contained in this news release are made as of the date of this news release, and the Company undertakes no obligation to update publicly or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise, except as expressly required by Canadian securities law.
This news release does not constitute an offer to sell or the solicitation of an offer to buy any securities within the United States. The securities to be offered have not been and will not be registered under the U.S. Securities Act of 1933, as amended, or any state securities laws, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of such Act or other laws.
Neither the 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
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