Two Significant Voting Agreements with Northern Financial Corporation
Have Been Terminated
ComnetiX Shareholders, Your Vote Continues to Be Extremely Critical.
Please Vote in Favour of ComnetiX's Plan of Arrangement with L-1 Identity
Solutions Inc.
OAKVILLE, ON, Feb. 2 /CNW/ - ComnetiX Inc. (TSX: CXI) announced today that the Ontario Superior Court of Justice will hear ComnetiX's application for an injunction prohibiting BIO-key International, Inc. ("Bio-key") from proceeding with its take-over bid for the common shares of ComnetiX, made on January 19, 2007. The Court today determined that ComnetiX's application for an injunction would be heard as soon as possible on or after February 8, 2007. A date for the hearing has to be scheduled between the parties.
The injunction is being sought by ComnetiX to enforce the terms of an agreement entered into by ComnetiX and Bio-key on May 17, 2006. As previously announced, the agreement was signed during preliminary discussions between ComnetiX and Bio-key with respect to a possible merger or other business combination, which did not materialize. The agreement included a customary "standstill" clause, which provided that Bio-key would not acquire ComnetiX's shares, or make an offer to acquire ComnetiX's shares, for a period of one year.
ComnetiX believes that Bio-key breached the "standstill" provision by making its unsolicited offer to acquire all of ComnetiX's outstanding shares.
Bernard Crotty, Chairman and Chief Executive Officer of ComnetiX said: "We are obviously very pleased that our application will be heard so quickly. We believe it is important that the Court enforce our agreement from May 2006, so that the contract between the parties is respected."
ComnetiX will issue a press release as soon as the Court renders its decision on the injunction.
Mr. Crotty added: "We urge shareholders to vote for our plan of arrangement with L-1 Identity Solutions, Inc. ("L-1") under which ComnetiX shareholders will receive US$1.12 cash per share, at our shareholders' meeting in Toronto on Thursday, February 8, 2007. Every vote is critical. We note that Northern Financial Corporation, which is soliciting proxies against our plan of arrangement, announced today that two voting agreements between certain of our shareholders and Northern with respect to 1,883,200 shares of ComnetiX have been terminated. We view this as an additional, significant blow to Bio-key's offer and we invite the holders of those shares, and all ComnetiX shareholders, to vote FOR the arrangement agreement with L-1."
As a result of the termination of the two voting agreements, the number of ComnetiX shares now owned or controlled or directed by Northern Financial Corporation has been reduced to 1,780,938, representing approximately 12.6% of the outstanding common shares.
Shareholders who have already voted against the plan of arrangement with L-1 can revoke their proxies and vote FOR the plan of arrangement. If shareholders have not yet voted, ComnetiX urges them to immediately vote FOR the plan of arrangement with L-1. Shareholders should contact ComnetiX's solicitation agent Georgeson toll-free at 1-866-598-9985 for assistance in voting.
About ComnetiX(TM) Inc. (www.ComnetiX.com)
ComnetiX(TM) Inc. provides secure identification and authentication solutions to both the public and private sectors throughout North America. ComnetiX offers multimode biometric identification solutions for use in areas such as applicant screening, financial services, health care, transportation, airlines and airports, casinos and gaming, and energy and utilities. Clients include American Airlines, Lehman Brothers, New York City Health and Hospital Corporation, New York State Division of Criminal Justice Services, Toronto Police Services Board, Boston Police Department and the Royal Canadian Mounted Police. ComnetiX is also Canada's premier applicant fingerprinting services company, facilitating tens of thousands of criminal background checks each year through its chain of ten offices across Canada. In addition, ComnetiX has established more than 40 applicant fingerprinting services locations throughout the United States.
Forward-Looking Statements
Statements made in this news release that relate to future plans, events or performances are forward-looking statements. Any statement in this release containing words such as "believes," "plans," "expects" or "intends" and other statements that are not historical facts are forward-looking, and these statements involve risks and uncertainties and are based on current expectations. Consequently, actual results could differ materially from the expectations expressed in these forward-looking statements.