TORONTO, ONTARIO--(Marketwired - Feb. 3, 2014) - C.A. Bancorp Inc. ("C.A. Bancorp" or the "Company") (TSX:BKP) is pleased to report that the previously announced sale transaction for its investee, Digital Payment Technologies Corp. ("DPT") has been completed. Pursuant to a court approved plan of arrangement in accordance with the Canada Business Corporations Act, a wholly-owned subsidiary of T2 Systems, Inc. (the "Purchaser") acquired all of the issued and outstanding shares and warrants of DPT, including those common share warrants and series x and series y preferred share warrants held by the Company (the "Transaction").
In connection with the Transaction, as consideration for the discharge of its indebtedness and the sale of its equity interests in DPT, C.A. Bancorp has received aggregate cash consideration of approximately CDN$15,258,000. The Company had invested an aggregate amount of CDN$6,650,000 in DPT. The cash consideration represents: (i) CDN$9,420,000 in respect of contractual amounts that were owing under the debenture and term promissory note including related fees and interest and (ii) CDN$5,838,000 in respect of the equity interests that were held by C.A. Bancorp in DPT. The consideration in respect of the equity interests is currently held in trust for the benefit of the Company and is expected to be distributed to the Company promptly. In addition, the Company is entitled to 42.1% of a holdback amount that has been placed in escrow to satisfy any claims that the Purchaser may have for a breach of certain representations or warranties provided by DPT in connection with the Transaction. Assuming no claims are made, the Company expects to receive an additional amount of approximately CDN$586,000 on or about July 31, 2014.
C.A. Bancorp Inc.
C.A. Bancorp is a publicly traded Canadian merchant bank and alternative asset manager that provides investors with access to a range of private equity and other alternative asset class investment opportunities.
This release includes certain forward-looking statements. Forward-looking statements generally can be identified by the use of forward-looking terminology such as "may", "will", "expect", "intend", "estimate", "anticipate", "believe", "should", "plans", or "continue" or the negative thereof or variations thereon or similar terminology. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, it can give no assurance that such expectations will prove to be correct. These statements are based on expectations including that additional cash consideration will be received and will be received on the timelines indicated. These forward-looking statements are subject to a number of risks and uncertainties. Additional important factors that could cause actual results to differ materially from expectations include, among other things, general economic and market factors. Actual results could differ materially from those anticipated in these forward-looking statements. Reference should also be made to the risk factors published in the Company's most recent management discussion and analysis and annual information form, both of which are available at www.sedar.com.