NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE
UNITED STATES. ANY FAILURE TO COMPLY WITH THIS RESTRICTION MAY CONSTITUTE A
VIOLATION OF U.S. SECURITIES LAW.
Windsor Private Capital and W 7 Acquisition Corp. ("W7") (TSX VENTURE:WSV.P) are
pleased to announce that W7 has entered into an amalgamation agreement dated May
22, 2013 (the "Amalgamation Agreement") with ViXS Systems Inc. ("ViXS"), a
corporation continued under the Canada Business Corporations Act ("CBCA"), and
ViXS Subco Inc. ("ViXS Subco"), a subsidiary of ViXS, pursuant to which, among
other things, ViXS Subco and W7 agreed to amalgamate under the CBCA (the
"Amalgamation"). Under the terms of the Amalgamation Agreement, holders of
common shares of W7 ("W7 Common Shares") will exchange, for every 38.8889 W7
Common Shares, one common share in the capital of ViXS ("ViXS Common Share"). If
the Amalgamation is implemented, it will constitute the "Qualifying Transaction"
of W7 under the applicable policies of the TSX Venture Exchange (the "TSXV").
About ViXS
ViXS is a leading fabless developer of smart network multimedia processor
solutions enabling the "Anytime-Anywhere" revolution in video entertainment.
ViXS combines its software, algorithm and semiconductor technologies into highly
integrated, low power system-on-chip ("SoC") solutions that deliver
best-in-class conversion of multimedia between formats and seamless connectivity
between devices while maintaining end-to-end content security. Since its
founding in 2001, ViXS has shipped over 26 million SoCs, mostly into the
multimedia home networking market and more recently the emerging cloud video
infrastructure market. ViXS sells its solutions directly to leading original
equipment manufacturers ("OEMs"), and indirectly to top-tier service providers
via leading original design manufacturers ("ODMs") worldwide and distributors in
Japan. OEMs produce, brand, and market their own multimedia equipment, while
equipment produced by ODMs is white-labelled by service providers and
distributed to their subscribers. ViXS' SoCs can be found in products from
blue-chip customers, such as Comcast, Cisco, DirecTV, Vodafone, SFR, Echostar /
Sling Media, Funai, LG, Sharp, Sony, Hitachi, Pioneer, NEC, and Toshiba. ViXS is
headquartered in Toronto, Canada with global operations and offices in Europe,
Asia and North America.
Summary Financial Information for ViXS
The following table sets out the summary consolidated financial information of
ViXS as at January 31, 2013 and 2012 and for the financial years ended January
31, 2013, 2012 and 2011, which has been derived from ViXS' audited consolidated
financial statements, prepared in accordance with International Financial
Reporting Standards (IFRS).
Year ended January 31,
------------------------------------
2011 2012 2013
------------------------------------
(US$ in thousands, except per share
data)
Consolidated Statements of Comprehensive Income Data
Revenue $91,730 $71,344 $35,697
Cost of sales 44,448 35,409 18,957
----------- ----------- ------------
Gross profit 47,282 35,935 16,740
----------- ----------- ------------
Operating expenses(1)
Research and development 23,174 22,849 26,917
Selling, general and administrative 16,448 16,895 13,449
----------- ----------- ------------
Total operating expenses 39,622 39,744 40,366
----------- ----------- ------------
Income (loss) from operations 7,660 (3,809) (23,626)
----------- ----------- ------------
Other income (expense):
Finance costs (1,148) (1,364) (981)
Share offering costs - (1,722) -
Finance income 82 32 51
Convertible preference share
revaluation adjustment (56,552) 96,918 29,584
----------- ----------- ------------
Total other income (expense) (57,618) 93,864 28,654
Income (loss) for before income taxes $(49,958) $90,055 $5,028
Income tax expense (44) (313) (118)
----------- ----------- ------------
Net income (loss) for the year (50,002) 89,742 4,910
Exchange difference on translating
foreign operations - 115 27
----------- ----------- ------------
Total comprehensive income (loss) for
the year $(50,002) $89,857 $4,937
----------- ----------- ------------
----------- ----------- ------------
Earnings (loss) per share:
Basic $(11.28) $18.67 $1.00
Diluted $(11.28) $(0.27) $(0.91)
Shares used in computing earnings
(loss) per share:
Basic 4,432 4,806 4,917
Diluted 4,432 26,605 27,152
(1) Includes share-based transaction
expense of:
Research and development $1,502 $1,317 $1,390
Selling, general and administrative 816 969 1,058
----------- ----------- ------------
$2,318 $2,286 $2,448
----------- ----------- ------------
----------- ----------- ------------
Selected Balance Sheet Data
Total Assets $35,907 $35,069 $21,520
Total Long-Term Financial Liabilities $205,828 $104,800 $85,954
Cash Dividends Declared - - -
About the Qualifying Transaction and the ViXS Private Placement
In connection with the Amalgamation, on May 22, 2013, ViXS (indirectly through
ViXS Subco) completed a private placement of 16,387,999 subscription receipts of
ViXS Subco (each, a "Subscription Receipt") at an offering price of $3.50 per
receipt for gross proceeds of $57,357,996.50 (the "ViXS Private Placement"). The
offering was conducted through a syndicate of agents co-led by GMP Securities
L.P. and Stifel Nicolaus Canada Inc. and including BMO Capital Markets, Cormark
Securities Inc. and Byron Capital Markets Ltd. (the "Agents"). Upon the
satisfaction of certain release and notice conditions, each Subscription Receipt
will be automatically exchanged (without any further action on the part of the
holder thereof and without payment of additional consideration) immediately
prior to the completion of the Amalgamation for one common share of ViXS Subco
("ViXS Subco Common Share"). Each such ViXS Subco Common Share will be exchanged
for one ViXS Common Share in accordance with the terms of the Amalgamation
Agreement.
The net proceeds of the ViXS Private Placement will be used to pay in full the
US$5.5 million aggregate principal amounts outstanding under ViXS' loan
agreement with Comerica Bank and loan arrangements with two of ViXS'
shareholders, and for working capital purposes. While ViXS currently anticipates
that it will use the net proceeds of the ViXS Private Placement as described
above, it may re-allocate the net proceeds from time to time depending upon
changes in business conditions prevalent at the time. ViXS does not anticipate
paying cash dividends on the ViXS Common Shares in the near future.
For their services in connection with the ViXS Private Placement, the Agents
will receive from ViXS Subco a commission equal to 6% of the gross proceeds of
the offering.
Pursuant to the terms of the Amalgamation Agreement, upon the Amalgamation
becoming effective:
-- each 38.8889 outstanding W7 Common Shares shall be exchanged for one
fully-paid and non-assessable ViXS Common Share;
-- each outstanding ViXS Subco Common Share shall be exchanged for one
fully-paid and non-assessable ViXS Common Share;
-- each outstanding ViXS Subco Class B share will be exchanged for one
common share of the amalgamated corporation; and
-- each 38.8889 outstanding options to purchase W7 Common Shares will be
exchanged for one option to purchase one ViXS Common Share, with
economically equivalent terms to the outstanding options to purchase W7
Common Shares.
The corporation resulting from the amalgamation of W7 and ViXS Subco will: (i)
be a wholly-owned subsidiary of ViXS; (ii) own or control all of ViXS Subco's
assets and be subject to all of ViXS Subco's obligations and liabilities; and
(iii) own or control all of W7's assets and be subject to all of W7's
obligations and liabilities. It is intended that it will be wound-up into ViXS
immediately following the completion of the Amalgamation (the "Resulting
Issuer").
Pursuant to the Amalgamation Agreement, (i) approximately 16,387,999 ViXS Common
Shares will be issued in exchange for ViXS Subco Common Shares, (ii) 321,429
ViXS Common Shares will be issued in exchange for W7 Common Shares, and (iii)
options to purchase an aggregate of 38,571 ViXS Common Shares will be issued in
exchange for options to purchase W7 Common Shares. It is expected that current
shareholders of ViXS, holders of Subscription Receipts who will ultimately
receive ViXS Common Shares upon the Amalgamation becoming effective, and former
shareholders of W7 will own approximately 67%, 33% and less than 1%,
respectively, of the issued and outstanding ViXS Common Shares
post-Amalgamation.
A copy of the Amalgamation Agreement is available electronically on the SEDAR
website at www.sedar.com under W7's profile.
Arm's Length Qualifying Transaction
The Amalgamation will be an arm's length transaction.
Shareholder Approval
Shareholders of W7 will be asked to approve the Amalgamation at an annual and
special meeting of W7 shareholders. Details of the meeting will be announced as
soon as they are available.
Pursuant to a voting support agreement dated May 22, 2013 among ViXS, ViXS Subco
and Ronald D. Schmeichel, President, CEO, CFO, Secretary and a director of W7,
Mr. Schmeichel has agreed, among other things and subject to certain exceptions,
to vote the W7 Common Shares that he owns and controls in favour of the
Amalgamation. Mr. Schmeichel currently owns or controls 9,800,000 W7 Common
Shares, or 78.4% of the issued and outstanding W7 Common Shares, and options to
purchase 625,000 W7 Common Shares as at the date hereof.
Proposed Management and Board of Directors and Insiders of the Resulting Issuer
W7 and ViXS anticipate that, following completion of the Amalgamation, the board
of directors of the Resulting Issuer will consist of the current directors of
ViXS, with the exception of Mr. Francois Laflamme, who is anticipated to resign
from the board of directors of ViXS prior to the completion of the Amalgamation.
ViXS is expected to add additional independent board members prior to the
completion of the Amalgamation but currently the board of directors is comprised
of six individuals including Sally J. Daub, Brian Antonen, Chris Bowick, Peter
Currie, and Ravi Viswanathan.
The following persons will constitute Insiders (as defined under Policy 1.1 of
the TSXV Corporate Finance Manual) of the Resulting Issuer:
-- Sally J. Daub has served as President and Chief Executive Officer since
co-founding ViXS in 2001. Prior to founding ViXS, Ms. Daub was Vice-
President & General Counsel at ATI Technologies Inc., a graphics chip
supplier. Prior to joining ATI, Ms. Daub held positions at Nortel and
the law firm of Smart & Biggar, where she specialized in IP licensing,
strategy, development and management. Ms. Daub is a director of Morega
Systems Inc. Ms. Daub holds a Bachelor of Applied Science degree with
honors in Chemical Engineering from the University of Ottawa and a LLB
from Dalhousie University, and is a registered patent agent in both the
United States and Canada.
-- Donna Wong has served as Vice President, Finance since March 2009. Prior
to then, she served as Director, Finance since joining ViXS in 2001.
Prior to joining ViXS, Ms. Wong held senior finance positions with 724
Solutions Inc., ATI Technologies Inc. and SHL Systemhouse Inc. from 1993
to 2000, where she specialized in strategic planning, financial
reporting and mergers and acquisitions. Prior to 1993, Ms. Wong spent
five years as an internal auditor and public accountant for various
retail and manufacturing industries. Ms. Wong is a Chartered Accountant
and Certified Management Accountant and holds a Master of Accounting and
Honours Bachelor of Arts degrees from the University of Waterloo.
-- Hugh Chow co-founded ViXS in 2001 and currently serves as Chief
Operating Officer. Prior to founding ViXS, Mr. Chow was director of IC
Technology at Cogency Semiconductor and held various managerial
positions at ATI Technologies Inc. Mr. Chow holds a number of U.S.
patents, a Bachelor of Science degree with honors in Electrical
Engineering from the University of Hong Kong, and a Master of Science
degree in Electrical Engineering from the University of Colorado.
-- Perry Chappell has served as Vice President, Worldwide Sales since
joining ViXS in 2005. Prior to joining ViXS, Mr. Chappell was Vice
President and General Manager at Genesis Microchip Inc. from 1996 until
2004. Prior to Genesis, Mr. Chappell held numerous executive, sales and
technical positions with IBM Canada. Mr. Chappell holds a Bachelor of
Science degree in Computer Science and Biology from the University of
Guelph.
-- Indra Laksono co-founded ViXS in 2001 and currently serves as Chief
Technology Officer. Mr. Laksono has held various positions within ViXS,
including overseeing Software Engineering, research and development,
ASIC architecture and Application Development. Prior to founding ViXS,
Mr. Laksono held a number of senior positions at ATI Technologies Inc.
Mr. Laksono has filed over 60 patents, primarily in video processing and
codecs. Mr. Laksono holds a Bachelor of Science degree in Computer
Science and Math, and a Master of Science degree in Computer Science
from University of Toronto.
-- John Pomeroy has served as Vice President, Sales, Infrastructure and
Networking since September 2011. Prior to then, he served as Senior
Director, Sales since joining ViXS in June 2005. Before joining ViXS,
Mr. Pomeroy held several sales and business development positions with
Genesis Microchip from 1997 to 2005. Prior to Genesis, Mr. Pomeroy spent
a decade working various technical sales positions in the electronic
image capture and processing industry. While at ViXS, Mr. Pomeroy has
filed 6 patents, primarily in video transcoding. He graduated from
Humber College in Toronto with a diploma in Creative Photography.
-- David Jones has served as Vice President, Marketing and Business
Development since September 2009. Prior to then, he served as Vice
President, Business Development since joining ViXS in January 2008.
Before joining ViXS, Mr. Jones worked at Conexant Systems in a number of
senior positions from 1999 to 2008. Prior to Conexant, Mr. Jones worked
for Motorola Semiconductors and LSI Logic where he held a number of
engineering functions. Mr. Jones is an IET member and holds a Bachelors
of Science degree with honors from the University of Herriot-Watt in
Scotland in Electrical and Electronic Engineering.
-- Kris Socha joined ViXS in 2003 as Manager/Director Field Application
Engineering. He served as Senior Director, Software until 2007 and as
Vice President, Software from 2007 until present. Before joining ViXS,
Mr. Socha held technical management positions at SilCom Technology,
Tinwald Networking, Wandel & Goltermann and Acterna. He holds a Master
of Science degree in Electrical Engineering from the Technical
University of Gdansk.
-- Brian Antonen is the Chairman of ViXS and is a partner with Celtic House
Venture Partners. Mr. Antonen opened the Toronto office of Celtic House
in 2000. Originally an electrical engineer, Mr. Antonen has over 24
years of technical, business operational and capital markets experience.
Mr. Antonen has held directorships on 17 private boards, and currently
serves as a board member of seven Celtic House portfolio companies. Mr.
Antonen holds a Bachelor of Applied Science degree in Electrical
Engineering from the University of Waterloo and a Master of Business
Administration degree from the Richard Ivey School at the University of
Western Ontario. Mr. Antonen is also a member of the Association of
Professional Engineers of Ontario and the Certified Management
Accountants Association of Ontario.
-- Chris Bowick is a director of ViXS and is the President of The Bowick
Group, LLC, where he provides strategic counsel to clients in the cable
television and telecommunications industry. From 2000 to 2009, Mr.
Bowick served as Cox Communications Senior Vice President of Engineering
& Chief Technical Officer. Prior to his tenure at Cox, Mr. Bowick served
as Group Vice President, Technology & Chief Technical Officer for Jones
Intercable, Inc., as well as President of Jones Futurex, a designer and
manufacturer of triple DES, PC-based hardware encryption devices. Mr.
Bowick earned an M.B.A. from the University of Colorado, and also holds
a bachelor's degree in electrical engineering from the Georgia Institute
of Technology. Mr. Bowick is a member and past board member of the
Society of Cable Telecommunications Engineers and was a member and past
Chairman of CableLabs' Technical Advisory Committee. He previously
served on the Board of Directors for Inlet Technologies, LiquidxStream
Systems, Liberate Technologies, and Bend Broadband.
-- Peter Currie joined the board in December 2009. Mr. Currie was
previously Executive Vice-President and Chief Financial Officer, Nortel
Networks Corporation, Vice Chairman and Chief Financial Officer, Royal
Bank of Canada, Senior Vice-President and Chief Financial Officer,
Nortel Networks Corporation (Northern Telecom Limited) and Executive
Vice-President and Chief Financial Officer, North American Life
Assurance Company. Mr. Currie is a member of the Board of Directors and
Chairman of the Audit Committee of Intelius Inc. He is also a member of
the Board of Directors and Chairman of the Board of Atomic Energy of
Canada, Limited. Mr. Currie holds a Bachelor of Economics degree and an
MBA from York University.
-- Ravi Viswanathan, PhD is a director of ViXS and is a general partner of
New Enterprise Associates, Inc. (NEA). Prior to joining NEA, he worked
at Goldman, Sachs & Co., where he was co-head of the technology practice
in their private equity group within the firm's asset management
division. Before Goldman, Sachs & Co., he worked for McKinsey & Company
and advised clients in the software, communications, and pharmaceutical
sectors on strategy, acquisitions and new business building. Dr.
Viswanathan previously worked for Raychem Corporation in the Corporate
Technology Division where he focused on research and product development
in semiconductors, liquid crystals, and other materials systems. Dr.
Viswanathan also serves on the Board of Directors of Avalink, Inc., CFCL
Technologies Limited, Deeya Energy, Inc., Jentro Technologies GmbH,
Skyline Solar, Inc. and Suniva, Inc., among others. He holds a Bachelor
of Science in Bioengineering from the University of Pennsylvania, an MBA
from the Wharton School at the University of Pennsylvania and a PhD in
Chemical Engineering from the University of California at Santa Barbara.
-- Celtic House Venture Partners ("Celtic House") is anticipated to own, or
exercise control or direction over, more than 10% of the ViXS Common
Shares upon the completion of the Amalgamation. Celtic House is an
independent Canadian investment firm. Since 1994, Celtic House has been
one of Canada's most active investors in technology and innovation. From
offices in Toronto, Montreal and Ottawa, Celtic House manages in excess
of $425 million across three funds. Celtic House is currently making new
investments out of Celtic House Venture Partners Fund IV, which it
closed in 2012 at $105 million.
-- New Enterprise Associates II, Limited Partnership and its affiliates are
anticipated to own, or exercise control or direction over, more than 10%
of the ViXS Common Shares upon the completion of the Amalgamation. New
Enterprise Associates Inc., together with its affiliated entities
("NEA"), is a leading venture capital firm focused on helping
entrepreneurs build transformational businesses across multiple stages,
sectors and geographies. With approximately $13 billion in committed
capital, NEA invests in technology and healthcare companies at all
stages in a company's lifecycle, from seed stage through IPO. In the
U.S., NEA has two offices in the Washington, D.C. metropolitan area and
one in Menlo Park, California. In addition, New Enterprise Associates
(India) Pvt. Ltd. has offices in Bangalore and Mumbai, India and New
Enterprise Associates (Beijing), Ltd. has offices in Beijing and
Shanghai, China.
Completion of the Amalgamation is subject to a number of conditions including,
but not limited to, regulatory approvals, TSXV acceptance, receipt of approval
for the listing of ViXS Common Shares on the TSX, shareholders of W7 approving,
among other things, the Amalgamation and, if applicable pursuant to TSXV
requirements, majority of the minority shareholder approval. The Amalgamation
cannot close until the required W7 shareholder approval is obtained. There can
be no assurance that the Amalgamation will be completed as proposed or at all.
Investors are cautioned that, except as disclosed in the management information
circular or filing statement to be prepared in connection with the Amalgamation,
any information released or received with respect to the Amalgamation may not be
accurate or complete and should not be relied upon. Trading in securities of a
capital pool company should be considered highly speculative.
This press release does not constitute an offer to sell or the solicitation of
an offer to buy any securities in any jurisdiction.
ANY SECURITIES REFERRED TO HEREIN HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER
THE U.S. SECURITIES ACT OF 1933 (THE "1933 ACT") AND MAY NOT BE OFFERED OR SOLD
IN THE UNITED STATES OR TO A U.S. PERSON IN THE ABSENCE OF SUCH REGISTRATION OR
AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE 1933 ACT.
Notice on forward-looking statements:
This release includes forward-looking statements regarding W7, ViXS, ViXS Subco,
and their respective businesses. Such statements are based on the current
expectations and views of future events of the management of each entity, and
are based on assumptions and subject to risks and uncertainties. Although the
management of each entity believes that the assumptions underlying these
statements are reasonable, they may prove to be incorrect. The forward-looking
events and circumstances discussed in this release, including completion of the
Amalgamation, may not occur and could differ materially as a result of known and
unknown risk factors and uncertainties affecting the companies, including
failure to satisfy conditions of closing contemplated by the Amalgamation
Agreement, risks regarding the semiconductor industry, market conditions,
economic factors, ViXS' management's ability to manage and to operate the
business, and the equity markets generally. No forward-looking statement can be
guaranteed. Except as required by applicable securities laws, forward-looking
statements speak only as of the date on which they are made and W7 and ViXS
undertake no obligation to publicly update or revise any forward-looking
statement, whether as a result of new information, future events, or otherwise.
W7 is a capital pool company governed by the policies of the TSXV. W7's
principal business is the identification and evaluation of assets or businesses
with a view to completing a Qualifying Transaction.
FOR FURTHER INFORMATION PLEASE CONTACT:
W7 Acquisition Corp.
Ronald D. Schmeichel
CEO
416-972-6294
ViXS Systems Inc.
Donna Wong
Vice President, Finance
416-646-2000 ext. 247
Grafico Azioni W 7 Acquisition Corp (TSXV:WSV.P)
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Da Mag 2024 a Giu 2024
Grafico Azioni W 7 Acquisition Corp (TSXV:WSV.P)
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Da Giu 2023 a Giu 2024