Cortex Business Solutions Inc. (“Cortex”) (TSXV:
CBX), a North American network-as-a-service e-invoicing solutions
provider, announced today that it has entered into an arrangement
agreement (the "Arrangement Agreement") under which Drilling Info,
Inc. ("Drillinginfo"), a portfolio company of Genstar Capital
Partners, LLC, has agreed to acquire all of the outstanding shares
of Cortex (the "Shares") for a cash payment of $4.55 per Share (the
"Arrangement"), representing total equity value, on a fully diluted
basis, of approximately $45.7 million.
The $4.55 per Share purchase price represents a
premium of approximately 19.7% to the closing price of the Shares
on the TSX Venture Exchange on December 18, 2018, the last trading
day prior to this announcement, and a 22.7% premium to the
volume-weighted average trading price of the Shares over the last
20 trading days.
The board of directors of Cortex (the "Board"),
based on the unanimous recommendation of its special committee of
independent directors (the "Special Committee") and after
consultation in its evaluation of the Arrangement with legal and
financial advisors, has unanimously approved the Arrangement
Agreement, determined that the Arrangement is in the best interests
of Cortex and recommends that shareholders and optionholders of
Cortex (collectively the "Securityholders") vote in favour of the
Arrangement.
“We have been working collaboratively with the
Oildex and Drillinginfo teams for years on enhancing the digital
standards for our collective industries, and now we will be
focusing on delivering the execution of those standards as a
combined technology group. This makes for an exciting time for the
oil and gas industry as well as the expanded service industries
that Cortex serves, providing one network for all trading parties.”
remarked Joel Leetzow, Cortex’s President and Chief Executive
Officer. “The offer from Drillinginfo provides Cortex shareholders
with an immediate liquidity event at an attractive premium.”
Details of the Arrangement
The Arrangement will be carried out by way of a
statutory plan of arrangement under the Business Corporations Act
(Alberta), and will be subject to approval by (i) at least
two-thirds of the votes cast by Shareholders in person or by proxy,
and (ii) two-thirds of the votes cast on the Arrangement Resolution
by optionholders and Shareholders present in person or represented
by proxy at the Meeting, voting together as a single class and if
required the "majority of the minority", being a majority of the
votes cast by Shareholders excluding Shareholders whose votes may
not be included in determining if minority approval is obtained
pursuant to Multilateral Instrument 61-101 – Protection of Minority
Security Holders in Special Transactions.
Securityholder approval of the Arrangement will
be sought at a special meeting of Securityholders (the "Meeting")
that is expected to be held in February 2019. The terms and
conditions of the Arrangement will be summarized in Cortex's
management information circular, which is expected to be mailed to
Securityholders in January 2019.
In connection with the Arrangement, Cormark
Securities Inc. ("Cormark"), Cortex's financial advisor, delivered
an opinion, dated December 18, 2018, to the Special Committee and
the Board as to the fairness, from a financial point of view and as
of such date, of the consideration to be received by the holders of
Cortex Shares pursuant to the Arrangement Agreement. The full
text of Cortex's written opinion, dated December 18, 2018, which
describes the assumptions made, procedures followed, matters
considered and limitations and qualifications on the review
undertaken, will be included in Cortex's management information
circular.
Under the terms of the Arrangement Agreement,
the Arrangement is also subject to the final approval of the Court
of Queen's Bench of Alberta following the Meeting, the completion
of applicable regulatory reviews and the satisfaction of certain
closing conditions customary in transactions of this nature,
including the absence of material adverse changes in the business
and affairs of Cortex. The Arrangement is not conditional on
Drillinginfo obtaining financing.
The Arrangement Agreement contains customary
non-solicitation provisions which restrict Cortex from soliciting
or entertaining any third-party acquisition proposals, subject to
customary "fiduciary out" provisions that entitle Cortex to
consider and accept a superior proposal subject to a matching right
in favour of Drillinginfo. If the Arrangement Agreement is
terminated in certain circumstances, including if Cortex enters
into an agreement with respect to a superior proposal or if the
Board withdraws its recommendation with respect to the Arrangement,
Drillinginfo is entitled to a termination payment equal to 3.5% of
the purchase price. If the agreement is terminated in certain other
circumstances, Cortex is entitled to a reverse break fee equal to
3.5% of the purchase price.
Cortex's directors and senior officers and two
significant shareholders of Cortex holding, in aggregate,
approximately 34.95% of the outstanding Shares and options of
Cortex have entered into voting agreements which provide that they
will vote the Shares and options held by them in favour of the
resolution authorizing the Arrangement.
A copy of the Arrangement Agreement will be
available on SEDAR at www.sedar.com.
Cormark Securities Inc. acted as Cortex’s
exclusive financial advisor and DLA Piper (Canada) LLP as legal
counsel. Drillinginfo has engaged Irell & Manella LLP and
Blake, Cassels & Graydon LLP as legal counsel in connection
with the Arrangement.
About Cortex
Cortex is a service-centric, digital
transformation solutions provider focused on revolutionizing B2B
document exchange. We help businesses save time and money by
replacing traditional paper-based manual systems with AP and AR
invoice automation. Companies on the Cortex Network are positioned
for success with solutions that offer the scalability and
flexibility needed to evolve with their unique business needs.
Cortex specializes in the development and delivery of integrated
electronic document intake and management solutions using flexible
connection methods that leverage existing technologies and
processes.
Cortex is currently enabling digital
transformation in over 11,000 companies in the Oil & Gas,
Mining, Manufacturing and Sports & Entertainment industries.
For more information, please visit
www.cortex.net.
About Drillinginfo
Drillinginfo delivers business-critical insights to the
energy, power, and commodities markets. Its state-of-the-art SaaS
platform offers sophisticated technology, powerful analytics, and
industry-leading data. Drillinginfo’s solutions deliver value
across upstream, midstream and downstream markets, empowering
exploration and production (E&P), oilfield services, midstream,
utilities, trading and risk, and capital markets companies to be
more collaborative, efficient, and competitive. Drillinginfo
delivers actionable intelligence over mobile, web, and desktop to
analyze and reduce risk, conduct competitive benchmarking, and
uncover market insights. Drillinginfo serves over 5,000 companies
globally from its Austin, Texas, headquarters and has more than
1,000 employees. For more information visit
drillinginfo.com.Investor
Relations Contacts - Cortex:
Joel
Leetzow
Jason
Baird
President and
CEO
VP, Finance &
CFO
jleetzow@cortex.net
jbaird@cortex.net
403-219-2838
403-219-2838
Relations Contacts - Drillinginfo:
Jon Haubert jon@hblegacy.com303.396.5996
Forward-Looking Information
This press release contains forward-looking
statements and forward-looking information within the meaning of
applicable securities laws and which are based on the expectations,
estimates and projections of management of Cortex as of the date of
this news release unless otherwise stated. The use of any of the
words "expect", "anticipate", "continue", "estimate", "objective",
"ongoing", "may", "will", "project", "should", "believe", "plans",
"intends" and similar expressions are intended to identify
forward-looking statements or information. More particularly and
without limitation, this press release contains forward-looking
statements and information concerning: the anticipated benefits of
the Arrangement to the parties and the Securityholders; the timing
and anticipated receipt of required regulatory, court and
Securityholder approvals for the Arrangement; the ability of the
parties to satisfy the other conditions to, and to complete, the
Arrangement; and the anticipated timing of the meeting of
Securityholders to consider the Arrangement and for the closing of
the Arrangement.
In respect of the forward-looking statements and
information concerning the anticipated benefits and completion of
the proposed Arrangement and the anticipated timing for completion
of the Arrangement, the parties have provided such information in
reliance on certain assumptions that they believe are reasonable at
this time, including assumptions as to the time required to prepare
and mail Meeting materials; the ability of the parties to receive,
in a timely manner and on satisfactory terms, the necessary
regulatory, court, Securityholder, stock exchange and other third
party approvals; the ability of the parties to satisfy, in a timely
manner, the other conditions to the closing of the Arrangement; and
other expectations and assumptions concerning the Arrangement. The
anticipated dates provided may change for a number of reasons,
including unforeseen delays in preparing Meeting materials, the
inability to secure necessary Securityholder, regulatory, court or
other third party approvals in the time assumed or the need for
additional time to satisfy the other conditions to the completion
of the Arrangement. Accordingly, readers should not place undue
reliance on the forward-looking statements and information
contained in this press release.
Since forward-looking statements and information
address future events and conditions, by their very nature they
involve inherent risks and uncertainties. Actual results could
differ materially from those currently anticipated due to a number
of factors and risks. Risks and uncertainties inherent in the
nature of the transaction include the failure of Cortex to obtain
necessary Securityholder, regulatory, court and other third party
approvals, including those noted above, or to otherwise satisfy the
conditions to the completion of the Arrangement, in a timely
manner, or at all. Failure to so obtain such approvals, or the
failure of the parties to otherwise satisfy the conditions to or
complete the Arrangement, may result in the Arrangement not being
completed on the proposed terms, or at all. In addition, if the
Arrangement is not completed, and Cortex continues as an
independent entity, there are risks that the announcement of the
Arrangement and the dedication of substantial resources of Cortex
to the completion of the transaction could have an impact on
Cortex's current business relationships (including with future and
prospective employees, customers, distributors, suppliers and
partners) and could have a material adverse effect on the current
and future operations, financial condition and prospects of Cortex.
Furthermore, the failure of Cortex to comply with the terms of the
Arrangement Agreement may result in Cortex being required to pay a
fee, the result of which could have a material adverse effect on
Cortex's financial position and results of operations and its
ability to fund growth prospects and current operations.
Readers are cautioned that the foregoing list of
factors is not exhaustive. Additional information on other factors
that could affect the operations or financial results of Cortex are
included in reports on file with applicable securities regulatory
authorities, available on Cortex’s SEDAR profile. The
forward-looking statements and information contained in this press
release are made as of the date hereof and the parties undertake no
obligation to update publicly or revise any forward-looking
statements or information, whether as a result of new information,
future events or otherwise, unless so required by applicable
securities laws.
This release does not constitute an offer to
purchase or a solicitation of an offer to sell securities.
Securityholders are advised to review any documents that may be
filed with securities regulatory authorities and any subsequent
announcements because they will contain important information
regarding the Arrangement and the terms and conditions thereof.
Neither the TSX Venture Exchange nor its
Regulation Services Provider (as that term is defined in policies
of the TSX Venture Exchange) accepts responsibility for the
adequacy or accuracy of this news release.
Cortex Business Solutions Inc. (TSXV:CBX)
Historical Stock Chart
From Mar 2024 to Apr 2024
Cortex Business Solutions Inc. (TSXV:CBX)
Historical Stock Chart
From Apr 2023 to Apr 2024