Vision Capital Corporation

May 05, 2010 17:31 ET

Vision Capital Corporation Reports Holdings of Securities Convertible for Common Shares of San Anton Capital Inc.

TORONTO, ONTARIO--(Marketwire - May 5, 2010) - Vision Capital Corporation ("Vision Capital") today announced that on May 3, 2010, Vision Capital acquired control of (a) 9,000,000 subscription receipts ("Subscription Receipts") of Edleun, Inc. ("Edleun") and (b) warrants ("Compensation Warrants") to acquire up to 1,624,850 common shares of Edleun ("Edleun Shares") at a price of $0.50 per Edleun Share, at any time and from time to time prior to 5:00 p.m. (Toronto time) on the date that is 24 months following the CPC Transaction Closing Date (as defined below). 

Control of the Subscription Receipts was acquired in connection with the sale by Edleun of an aggregate of 9,000,000 Subscription Receipts to Vision Opportunity Fund Limited Partnership, Vision Opportunity Fund Trust and Vision Opportunity Fund Limited Partnership 2 (collectively, the "Funds") pursuant to a private placement of 67,225,000 Subscription Receipts completed by Edleun on May 3, 2010 (the "Private Placement"). Control of the Compensation Warrants was acquired as a result of the issuance by Edleun to Vision Capital's custodian (the "Holder"), for the benefit of the Funds, of such Compensation Warrants in consideration of certain services performed for Edleun by Vision Capital as a member of the selling group for the Private Placement. Vision Capital is the investment manager of each of the Funds and exercises discretion over all investments held by each of them.

The Private Placement of Subscription Receipts was completed by Edleun in connection with a proposed "reverse take-over" transaction (the "CPC Transaction") involving Edleun and San Anton Capital Inc. ("San Anton"). It is anticipated that the CPC Transaction will be completed by way of a triangular amalgamation (the "Business Combination") involving Edleun, San Anton and a wholly-owned subsidiary of San Anton ("San Anton Subco"), which will be carried out in accordance with the terms and conditions set forth in a business combination agreement among Edleun, San Anton, and San Anton Subco dated April 30, 2010 (the "Business Combination Agreement"). Pursuant to the Business Combination Agreement, among other things:

(a) San Anton will acquire all of the issued and outstanding Edleun Shares, including the Edleun Shares issuable upon exercise of the Subscription Receipts; and

(b) the holders of issued outstanding Edleun Shares, including the Edleun Shares issuable upon exercise of the Subscription Receipts, will receive one common share of San Anton (each a "San Anton Share" and, collectively, the "San Anton Shares") for each Edleun Share they hold immediately prior to the completion of the CPC Transaction.

Each Subscription Receipt entitles the holder thereof to one Edleun Share, without payment of any additional consideration and without any further action by the holder thereof, provided that the following conditions (the "Escrow Release Conditions") are satisfied at or before 5:00 p.m. (Toronto time) on May 31, 2010 (the "Escrow Deadline"): 

(a) the completion or satisfaction of all conditions precedent to the Business Combination Agreement (which conditions precedent are outlined in the Filing Statement dated May 4, 2010 prepared by San Anton and Edleun in connection with the CPC Transaction, a copy of which has been filed under San Anton's SEDAR profile at www.sedar.com) to the satisfaction of Macquarie Capital Markets Canada Ltd. and National Bank Financial Inc., acting reasonably;

(b) the receipt of all required shareholder and regulatory approvals, including the conditional approval of the TSX Venture Exchange (the "TSXV") and the Autorité des marchés financiers for the Business Combination and the listing of the San Anton Shares issuable pursuant to the Business Combination on the TSXV (including those issuable pursuant to the Business Combination in exchange for the Edleun Shares underlying the Subscription Receipts);

(c) the receipt of written confirmation from Vision Capital that it is satisfied, acting reasonably, with the evidence of title provided in respect of all real property to be acquired by Edleun pursuant to certain acquisition agreements to be entered into by Edleun in connection with completing the CPC Transaction; and

(d) the receipt of any third party consents necessary to consummate the Business Combination.

In addition, San Anton has agreed that, following the closing date of the CPC Transaction (the "CPC Transaction Closing Date"), it will take all steps necessary to issue to the Holder, in exchange for the Compensation Warrants, non-assignable warrants ("San Anton Warrants") to purchase up to 1,624,850 San Anton Shares, at a price of $0.50 per San Anton Share, at any time and from time to time prior to 5:00 p.m. (Toronto time) on the date that is 24 months following the CPC Transaction Closing Date.

As a result of all of the foregoing, under applicable Canadian securities laws, the Funds are deemed to have collectively acquired beneficial ownership of, and Vision Capital is deemed to have acquired control of:

(a) an aggregate of 10,624,850 Edleun Shares, consisting of:

(i) the 9,000,000 Edleun Shares into which the Subscription Receipts sold to the Funds pursuant to the Private Placement will be automatically exercised following satisfaction of the Escrow Release Conditions; and

(ii) the 1,624,850 Edleun Shares that may be acquired upon exercise of the Compensation Warrants; and

(b) an aggregate of 10,624,850 San Anton Shares, consisting of:

(i) the 9,000,000 San Anton Shares for which the Edleun Shares referred to in subparagraph (a)(i) above will be exchanged upon completion of the CPC Transaction; and

(ii) the 1,624,850 San Anton Shares that may be acquired upon exercise of the San Anton Warrants for which the Compensation Warrants will be exchanged following the CPC Transaction Closing Date. 

The 10,624,850 San Anton Shares over which Vision Capital is deemed to exercise control represent approximately 13.35% of the 79,585,151 San Anton Shares that are expected to be issued and outstanding following completion of the CPC Transaction (as determined by the Filing Party following consultation with Edleun and San Anton), assuming the exercise in full of the San Anton Warrants and subject to any further issuances of Subscription Receipts that may be completed by Edleun prior to completion of the CPC Transaction.

Other Information

Vision Capital acquired control over, and the Funds acquired beneficial ownership of, the Subscription Receipts and the Compensation Warrants that are the subject of this news release for investment purposes. 

In connection with the investment by the Funds in the Subscription Receipts and the Compensation Warrants, Vision Capital may engage in communications with members of management and the board of directors of San Anton, other current or prospective shareholders, industry analysts, existing or potential strategic partners or competitors, investment and financing professionals, sources of credit and other investors with respect to San Anton. Vision Capital intends to review the Funds' investment in San Anton on a continuing and ongoing basis. Depending on various factors including, without limitation, San Anton's financial position, the price levels of San Anton Shares or other securities of San Anton, conditions in the securities markets and general economic and industry conditions, the Funds' business or financial condition and other factors and conditions Vision Capital deems appropriate, Vision Capital may in the future take such actions with respect to the investment by the Funds in San Anton as Vision Capital deems appropriate including, without limitation, seeking additional board representation or discontinuing any board representation it has, making proposals to San Anton concerning changes to the capitalization, ownership structure or operations of San Anton, acquiring San Anton Shares or other securities of San Anton, or selling or otherwise disposing of some or all of its San Anton Shares. In addition, Vision Capital may formulate other purposes, plans or proposals regarding San Anton or any of its securities to the extent deemed advisable in light of general investment and trading policies, market conditions or other factors or may change its intention with respect to any and all matters referred to above.

Neither the issuance of this news release in connection with the matters disclosed in this news release nor the filing by Vision Capital of a report in respect of the matters disclosed in this news release in accordance with applicable Canadian securities laws is an admission that an entity named or otherwise referred to in this news release is a joint actor with another entity named or otherwise referred to in this news release.

The address of Vision Capital is set out below. For further information, including to obtain a copy of the report filed by Vision Capital in respect of the matters disclosed in this news release in accordance with applicable Canadian securities laws, contact Vision Capital at the address specified below.

Contact Information

  • Vision Capital Corporation
    181 University Avenue
    Suite 1410
    Toronto, ON, M5H 3M7
    Attn: Jeffrey F. Olin
    416.362.0300