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EXFO Inc. (NASDAQ: EXFO) (TSX:EXF) ("EXFO" or the "Corporation") announces the filing of its management proxy solicitation circular (the "Circular") and related proxy materials in connection with the special meeting of shareholders (the "Special Meeting") to consider a special resolution approving the previously announced statutory plan of arrangement (the "Arrangement") under section 192 of the Canada Business Corporations Act pursuant to which 11172239 Canada Inc. (the "Purchaser"), a corporation controlled by Germain Lamonde, EXFO's founder and controlling shareholder, will acquire 100% of EXFO's subordinate voting shares (the "Subordinate Voting Shares") for US$6.00 per Subordinate Voting Share, except for the Subordinate Voting Shares already controlled, directly or indirectly, by Germain Lamonde and Philippe Morin (the "Excluded Shares") (assuming an agreement is reached between Mr. Lamonde and Mr. Morin such that Mr. Morin becomes a shareholder of the Purchaser).
Pursuant to an interim order obtained on July 15, 2021, the Special Meeting will be held on August 13, 2021 at 10:00 a.m. (Québec City time) exclusively in virtual format. Shareholders of record as of the close of business on June 22, 2021 will be entitled to receive notice of, to participate in, and to vote at the Special Meeting. The Circular and related proxy materials will be mailed to shareholders and will also be available under EXFO's profile on SEDAR at www.sedar.com and on EDGAR at www.sec.gov. Details on the virtual Special Meeting and how shareholders can access the Special Meeting will be set out in the Circular.
Act Now To Secure Premium Consideration and Certainty of Value
The Consideration to be paid to the holders of Subordinate Voting Shares (other than to the holders of the Excluded Shares), provides:
Furthermore, Mr. Germain Lamonde, who controls, directly or indirectly, 61.46% of the issued and outstanding shares of EXFO and 93.53% of the voting rights attached to all the issued and outstanding shares of EXFO, has unequivocally stated that he would not consider any alternative change of control transaction.
All of the directors who own or control Subordinate Voting Shares (directly or indirectly) and certain officers who collectively own or exercise control or direction over approximately 17.54% of the Subordinate Voting Shares and 93.78% of the outstanding voting rights attached to all of the issued and outstanding shares of the Corporation, have entered into Directors & Officers Support and Voting Agreements pursuant to which they have agreed, subject to the terms thereof, to vote all of their Subordinate Voting Shares IN FAVOUR of the special resolution approving the Arrangement.
The board of directors of EXFO (with Mr. Germain Lamonde and Mr. Philippe Morin having recused themselves), acting on the unanimous recommendation of the special committee comprised entirely of independent directors, unanimously approved the Arrangement and unanimously recommends that shareholders vote IN FAVOUR of the Arrangement at the Special Meeting.
Implementation of the Arrangement will be subject to the approval of at least (i) two-thirds (662/3%) of the votes cast by shareholders virtually present or represented by proxy at the Special Meeting, voting as a single class (each holder of Subordinate Voting Shares being entitled to one vote per Subordinate Voting Share and each holder of multiple voting shares being entitled to ten votes per multiple voting share); and (ii) because the proposed transaction is subject to Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions ("MI 61-101"), the approval of the majority of the holders of Subordinate Voting Shares virtually present or represented by proxy at the Special Meeting, excluding the votes of shareholders whose votes are required to be excluded for the purposes of "minority approval", namely the Excluded Shares, under MI 61-101 in the context of a "business combination" (the "Minority Approval").
Voting Instructions
Shareholders are urged to ensure that proxies are received by the Corporation's depository, AST Trust Company (Canada), at 1 Toronto Street, Suite 1200, Toronto, Ontario, M5C 2V6, Attention: Proxy Department, or at 2001 Robert Bourassa Boulevard, Suite 1600, Montreal, Québec, H3A 2A6, Attention: Proxy Department, by no later than 10:00 a.m. (Québec City time) on August 11, 2021 (or 48 hours, excluding Saturdays, Sundays and statutory holidays, prior to the commencement of the reconvened special shareholders' meeting if the Special Meeting is adjourned or postponed). Late proxies may be accepted or rejected by the Chair of the Special Meeting at his or her discretion, and the Chair of the Special Meeting is under no obligation to accept or reject any particular late proxy.
If shareholders have any questions about the information contained in the Circular or require assistance in completing the form of proxy, they can contact EXFO's proxy solicitor, D.F. King Canada, a division of AST Investor Services Inc. (Canada) toll-free in North America at 1 (866) 822-1242, direct at (416) 682-3825 or by email at inquiries@dfking.com. Questions on how to complete the letter of transmittal, should be directed to EXFO's depositary, AST Trust Company (Canada), at 1 (800) 387-0825 (toll-free within North America) or at (416) 682-3860 (outside of North America) or by email at inquiries@astfinancial.com.
No Offer or Solicitation
This press release is for informational purposes only and does not constitute an offer to buy or the solicitation of an offer to sell EXFO's Subordinate Voting Shares. The full details of the Arrangement are described in the Circular (including the related letter of transmittal and all other offer documents filed by EXFO with the United States Securities and Exchange Commission (the "SEC")), which is available without charge on the SEC's website at www.sec.gov or by calling EXFO's Corporate Secretary at (418) 683-0913, Ext. 23704. Offer documents required to be filed in Canada are also available without charge at www.sedar.com. Shareholders are urged to read these materials carefully.
In connection with the transaction, the Corporation will prepare and mail a Schedule 13E-3 Transaction Statement (the "Schedule 13E-3"). The Schedule 13E-3 will be filed with the SEC. INVESTORS AND SHAREHOLDERS ARE URGED TO READ CAREFULLY AND IN THEIR ENTIRETY THE SCHEDULE 13E-3 AND OTHER MATERIALS FILED WITH THE SEC WHEN THEY BECOME AVAILABLE, AS THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE CORPORATION, THE TRANSACTION, AND RELATED MATTERS. In addition to receiving the Schedule 13E-3 by mail, shareholders will also be able to obtain these documents, as well as other filings containing information about the Corporation, the transaction, and related matters, without charge from the SEC's website (http://www.sec.gov).
The Corporation and certain of its directors and executive officers may, under SEC rules, be deemed to be "participants" in the solicitation of proxies from the shareholders with respect to the Arrangement. Information regarding the persons who may be considered "participants" in the solicitation of proxies is set forth in the Schedule 13E-3 transaction statement relating to the proposed plan of arrangement and the Circular, which are attached as exhibits thereto. Further information regarding persons who may be deemed participants, including any direct or indirect interests they may have, is also set forth in the Circular.
