Rand Capital Announces Final Certified Results for Special Meeting with Shareholders Approving All Proposals
May 23 2019 - 4:15PM
Business Wire
Rand Capital Corporation (Nasdaq:RAND) (“Rand” or “Rand Capital”
or the “Company”), a business development company, announced today
that the independent inspector of elections for Rand’s special
meeting of shareholders has issued the final certified voting
results for the special meeting confirming that shareholders have
approved all proposals related to the transformational transactions
with East Asset Management, LLC (“East”).
Erland “Erkie” Kailbourne, Chairman of the Board, commented, “On
behalf of the Rand Board of Directors, I would like to thank our
shareholders for their support of this transaction. We believe the
strategic investment by East Asset Management into Rand is both a
testament to the success of our organization and a transforming
opportunity for future growth.”
Under the terms of the stock purchase transaction, which was
announced on January 25, 2019, East will purchase approximately 8.3
million shares of common stock, at a price of $3.00 per share, for
total consideration payable to the Company of $25.0 million. The
consideration will consist of a combination of cash and the
contribution of income-producing portfolio assets. As a result of
the stock purchase, East will hold approximately 57% of the
outstanding shares of the Company. In addition, Rand will
externalize the management of its assets.
Allen F. “Pete” Grum, President and CEO, noted, “We are pleased
that shareholders confirmed their support for management to advance
this transformational transaction and provide a path for enhanced
shareholder returns. We look forward to a strong future with East
Asset Management.”
Rand expects the transaction to close in the second half of
2019, subject to receipt of required regulatory approvals.
About Rand Capital
Rand Capital (Nasdaq:RAND) is a Business Development Company
(BDC) with a wholly-owned subsidiary licensed by the U.S. Small
Business Administration (SBA) as a Small Business Investment
Company (SBIC). Rand currently focuses its equity investments in
early or expansion stage companies and generally lends to more
mature companies. The Company seeks investment opportunities in
businesses with strong leaders who are bringing to market new or
unique products, technologies or services that have a high
potential for growth. Additional information can be found at the
Company’s website where it regularly posts information:
http://www.randcapital.com/.
About East Asset Management
East Asset Management (EAM), formed in 2010, is dedicated to
investing in private & public market securities and has formed
multiple investment vehicles that provide capital to a variety of
industries including energy, media, real estate, hospitality,
sports and entertainment. EAM has developed a unique and
proprietary network for sourcing investment opportunities,
including opportunities in the private credit/current yield space,
leveraging both its in-house and affiliated investment talent and
capabilities. EAM is an entity owned by Terry and Kim Pegula,
owners of Pegula Sports & Entertainment: the management company
streamlining key business areas across all Pegula family-owned
sports and entertainment properties including the Buffalo Bills,
Buffalo Sabres, Buffalo Bandits, Rochester Americans, Harborcenter,
Black River Entertainment, ADPRO Sports, PicSix Creative agency and
numerous hospitality properties.
Cautionary Statement Regarding Forward-Looking
Statements
This press release contains “forward-looking statements” within
the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended. All statements, other than historical facts, including but
not limited to statements regarding the expected timing of the
closing of the proposed transactions; the ability of the parties to
complete the proposed transactions considering the various closing
conditions, including approval from the U.S. Small Business
Administration (“SBA”); the intention of Rand Capital and Rand
Capital SBIC, Inc. (“Rand SBIC”) to elect to be taxed as a
regulated investment companies for U.S. federal tax purposes; the
intention to declare and pay a special cash and stock dividend
after the closing of the proposed transactions; the intention to
pay a regular cash dividend after the completion of the proposed
transactions; the expected benefits of the proposed transactions
such as a lower expense-to-asset ratio for Rand Capital, increased
net investment income, availability of additional resources,
expanded access to and sourcing platform for new investments and
streamlining of operations under the external management structure;
the business strategy of originating additional income producing
investments; the competitive ability and position of Rand Capital
following completion of the proposed transactions; and any
assumptions underlying any of the foregoing, are forward-looking
statements. Forward-looking statements concern future circumstances
and results and other statements that are not historical facts and
are sometimes identified by the words “may,” “will,” “should,”
“potential,” “intend,” “expect,” “endeavor,” “seek,” “anticipate,”
“estimate,” “overestimate,” “underestimate,” “believe,” “could,”
“project,” “predict,” “continue,” “target” or other similar words
or expressions. Should one or more of these risks or uncertainties
materialize, or should underlying assumptions prove to be
incorrect, actual results may vary materially from those indicated
or anticipated by such forward-looking statements. The inclusion of
such statements should not be regarded as a representation that
such plans, estimates or expectations will be achieved. Important
factors that could cause actual results to differ materially from
such plans, estimates or expectations include, among others, (1)
that one or more closing conditions to the stock purchase may not
be satisfied or waived, on a timely basis or otherwise, including
that the SBA may not approve the proposed transactions; (2) the
risk that the proposed transactions may not be completed in the
time frame expected by parties, or at all; (3) the risk that Rand
Capital and/or Rand SBIC may be unable to fulfill the conditions
required in order to elect to be treated as a regulated investment
company for U.S. tax purposes; (4) uncertainty of the expected
financial performance of Rand Capital following completion of the
proposed transactions; (5) failure to realize the anticipated
benefits of the proposed transactions, including as a result of
delay in completing the proposed transactions; (6) the risk that
the board of directors of Rand Capital is unable or unwilling to
declare and pay the special cash and stock dividend or pay
quarterly dividends on a going forward basis; (7) the occurrence of
any event that could give rise to termination of the stock purchase
agreement; (8) the risk that shareholder litigation in connection
with the proposed transactions may affect the timing or occurrence
of the contemplated transactions or result in significant costs of
defense, indemnification and liability; (9) evolving legal,
regulatory and tax regimes; (10) changes in general economic and/or
industry specific conditions; and (11) other risk factors as
detailed from time to time in Rand Capital’s reports filed with the
Securities and Exchange Commission (“SEC”), including Rand
Capital’s annual report on Form 10-K for the year ended December
31, 2018, later filed quarterly reports on Form 10-Q, the
definitive proxy statement for the proposed transactions and other
documents filed with the SEC. Consequently, such forward-looking
statements should be regarded as Rand Capital’s current plans,
estimates and beliefs. Except as required by applicable law, Rand
Capital assumes no obligation to update the forward-looking
information contained in this release.
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version on businesswire.com: https://www.businesswire.com/news/home/20190523005770/en/
Rand Capital CorporationAllen F. ("Pete") GrumPresident and
CEO716.853.0802pgrum@randcapital.com
Investors:Deborah K. Pawlowski / Karen L. HowardKei
Advisors LLC716.843.3908 / 716.843.3942dpawlowski@keiadvisors.com /
khoward@keiadvisors.com
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