ComnetiX Board Unanimously Approves Amended Agreement with L-1
OAKVILLE, ON, Jan. 10 /CNW/ - ComnetiX Inc. (TSX: CXI) today announced that ComnetiX and L-1 Identity Solutions, Inc. (NYSE: ID) have amended the terms of their previously-announced agreement, entered into on November 15, 2006, for L-1 to acquire all of the outstanding shares of ComnetiX.
Under the amended agreement, which was executed as of January 9, 2007, L-1 will pay ComnetiX shareholders US$1.05 per share in cash for all of the issued and outstanding shares of ComnetiX, for a total purchase price of approximately US$16.0 million. The previous purchase price was US$0.82 per share. The revised purchase price from L-1 reflects a premium of more than 100 % over the price of ComnetiX's shares prior to the initial announcement of L-1's offer in November 2006. The acquisition will remain structured as an arrangement under the Canada Business Corporations Act.
The Board of Directors of ComnetiX has confirmed its unanimous approval of the revised arrangement and its determination that the revised arrangement is fair to, and in the best interests of, ComnetiX, its shareholders and warrantholders. The Board of Directors of ComnetiX unanimously recommends that ComnetiX's shareholders and warrantholders vote FOR the special resolution approving the arrangement, as revised.
L-1 and ComnetiX also agreed to three technical changes to the proposed arrangement. First, the date by which the arrangement must be completed has been extended to March 29, 2007. Second, the maximum amount payable by ComnetiX to holders of in-the-money stock options has been increased from US$160,000 to US$285,000. Third, the amount of cash that ComnetiX must deliver at the closing of the transaction has been reduced to US$1,025,000, to reflect an increase in payments by ComnetiX to holders of in-the-money stock options and in the expenses of the transaction.
ComnetiX will mail an amendment to its management information circular to security holders who are entitled to vote at the annual and special meeting. The amendment to the circular will describe the changes to the arrangement referenced in this press release and will be accompanied by letters from ComnetiX and L-1. All other terms of the arrangement, as described by ComnetiX in its management information circular dated December 18, 2006, remain unchanged.
An annual and special meeting of shareholders and warrantholders of ComnetiX will be held at 10:00 a.m. on January 19, 2007 at The First Canadian Place Gallery, 100 King Street West, Toronto, Ontario, to vote on the arrangement, as revised, as well as on other matters. Irrevocable voting agreements in favour of the arrangement have already been signed by directors and officers of ComnetiX, representing approximately 31 percent of the outstanding shares of ComnetiX. Similar agreements have been signed by the holders of approximately 70 percent of the outstanding warrants.
ComnetiX shareholders and warrantholders who have previously voted against the plan of arrangement and who now wish to support the amended agreement should do so by voting the Management form of proxy which accompanied the December 18, 2006 information circular from ComnetiX, or by contacting Georgeson for assistance at 1-866-598-9985.
Proxies must be returned by no later than 4:00 p.m. Toronto time on January 17, 2007. SHAREHOLDERS AND WARRANTHOLDERS MAY REVOKE A PROXY ALREADY GIVEN BY COMPLETING AND DELIVERING A LATER-DATED COMNETIX MANAGEMENT PROXY. A LATER-DATED PROXY AUTOMATICALLY REVOKES ANY AND ALL PRIOR PROXIES GIVEN IN CONNECTION WITH THE MEETING.
The management of ComnetiX is aware of a purported unsolicited tender offer by Bio-key International Inc. for all of the common shares of ComnetiX. To date, ComnetiX has not received any such offer from Bio-key.
About L-1 Identity Solutions
L-1 Identity Solutions, Inc. (NYSE: ID) consists of, among other businesses, the historic operations of Viisage Technology, Inc. and Identix Incorporated, which merged on August 29, 2006. L-1 Identity Solutions, together with its portfolio of companies, offers a comprehensive set of products and solutions for protecting and securing personal identities and assets. Leveraging the industry's most advanced multi-modal biometric platform for finger, face and iris recognition, our solutions provide a circle of trust around all aspects of an identity and the credentials assigned to it -- including proofing, enrollment, issuance and usage. With the trust and confidence in individual identities provided by L-1 Identity Solutions, government entities, law enforcement and border management agencies, and commercial enterprises can better guard the public against global terrorism, crime and identity theft fostered by fraudulent identity. L-1 Identity Solutions is headquartered in Stamford, CT. For more information, visit www.L1ID.com.
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.