Automodular Announces Preliminary Results of Share Buyback

PICKERING, ONTARIO--(Marketwired - Sept. 18, 2015) - Automodular Corporation (NEX:AM.H) ("Automodular" or the "Corporation") today announced preliminary results of its substantial issuer bid for the purchase and cancellation by Automodular of up to Cdn$15 million in value of its outstanding common shares (the "Shares") from shareholders (the "Offer"), which expired at 5:00 p.m. (Toronto time) on September 17, 2015.

Based on preliminary results, Automodular will accept for purchase and cancellation 5,660,377 Shares at a purchase price of Cdn$2.65 per Share, totalling Cdn$14,999,999 in accordance with the terms of the Offer. These Shares represent approximately 29.38% of the Shares currently issued and outstanding. After the repurchase, the number of Shares issued and outstanding will be 13,607,927.

A total of 5,762,079 Shares were validly deposited to the Offer. Of those Shares validly deposited, a total of 2,183,790 Shares were tendered to the Offer at the purchase price of Cdn$2.65 per Share, the highest price proposed in the Offer by Automodular. Based on preliminary results and in accordance with the terms of the Offer, after the purchase of odd lots, the Shares will be taken up on a pro rata basis such that all shareholders who deposited Shares will have approximately 98.2% of the Shares they tendered purchased for cancellation at a purchase price of $2.65 per Share.

Shares tendered to the Offer but not purchased will be returned to shareholders as soon as practicable.

Tax Information

For Canadian tax purposes a deemed dividend of Cdn$2.07 per Share arises on this Offer. For the enhanced dividend tax credit under subsection 89(14) of the Income Tax Act (Canada) and for any corresponding provincial legislation, Automodular designates the entire deemed dividend arising on each Share buyback as an "eligible dividend" being an amount equal to Cdn$2.07 per Share. For purposes of subsection 191(4) of the Income Tax Act (Canada), the specified amount in respect of each Share purchased under this Offer is Cdn$2.65 per Share.

This press release contains forward-looking statements that involve a number of risks and uncertainties including the preliminary results of the substantial issuer bid and contemplated take up of shares. Among the important factors that could cause actual results to differ materially from those indicated by such forward-looking statements are market and general economic conditions and the risk factors detailed from time to time in the Corporation's periodic reports filed with the Canadian securities regulatory authorities and on SEDAR at www.sedar.com. Readers are cautioned not to rely on forward-looking statements. Except as required under continuous disclosure obligations, the Corporation undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.