Rand Capital Announces Preliminary Results of Special Meeting with Shareholders Supporting All Proposals
May 22 2019 - 5:00PM
Business Wire
Rand Capital Corporation (Nasdaq:RAND) (“Rand” or “Rand
Capital”), a business development company, announced today that
based on the preliminary voting results provided by the independent
inspector of election, but subject to certification of the final
voting results by the independent inspector of election, all
proposals related to the transformational transactions with East
Asset Management, LLC (“East”) were approved at a special meeting
of shareholders (the “Meeting”) held on May 16, 2019.
At the special meeting, shareholders:
- Approved the issuance and sale of
approximately 8.3 million shares of common stock to East at a price
per share of $3.00 for total consideration of $25 million in cash
and income-producing portfolio assets pursuant to a Stock Purchase
Agreement dated January 24, 2019.
- Approved the issuance of shares to East
under the Nasdaq listing rules.
- Approved the Company’s entry into an
investment advisory agreement and the resulting externalization of
management.
- Approved the amendment of the Company’s
certificate of incorporation to increase the number of authorized
shares of common stock to 100 million shares.
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 CapitalRand 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 ManagementEast 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
StatementsThis 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/20190522005848/en/
Company:Allen F. ("Pete") GrumPresident and CEOPhone:
716.853.0802Email: pgrum@randcapital.com
Investors:Deborah K. Pawlowski / Karen L. HowardKei
Advisors LLCPhone: 716.843.3908 / 716.843.3942Email:
dpawlowski@keiadvisors.com /
khoward@keiadvisors.com
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