SOURCE: DirectCash Payments Inc.

DirectCash Payments Inc.

January 04, 2016 20:09 ET

DirectCash Payments Inc. Announces the Closing and Settlement of All Class Action Law Suits

CALGARY, AB--(Marketwired - January 04, 2016) - DirectCash Payments Inc. ("DCPayments" or the "Company") (TSX: DCI) today announced that the implementation of the Plan of Arrangement (the "Plan") approved by the court under the Companies' Creditors Arrangement Act ("CCAA") for The Cash Store Financial Inc. and its affiliates ("CSF") occurred January 4, 2016, confirming that the closing of the Plan occurred on December 31, 2015. The Company has received a release for all the class action lawsuits which have been filed against the Company.

In addition to settling the class action law suits that have been filed, DCPayments and DirectCash Bank ("DC Bank") have secured a release from claims that may arise as a result of the relationship with The Cash Store Financial Inc. and its affiliates. As consideration for the release and settlement of the class action law suits, DCPayments has agreed to release $7 million of cash security it has been holding from CSF and pay an additional $7.5 million (collectively the "Settlement Funds"). The Settlement Funds are to be divided between CSF and each of the class action law suit plaintiffs.

As part of the settlement, DCPayments negotiated progressive payment of the Settlement Funds with $2 million being paid into trust at the time of execution of the Settlement Agreement, a further $10 million becoming payable on the implementation of the Plan, and the final $2.5 million being paid in the second quarter of 2016.

Management's Commentary
"We are pleased to have finalized the court approved closing and settlement of the class action lawsuits. We believe the settlement agreement delivers significant value to DC Payments by allowing us to concentrate on our strategic growth plans and avoiding the distraction and expense of defending these and any future claims," said Jeffrey Smith, DCPayments' President and Chief Executive Officer. 

Forward Looking Information:
Certain statements contained in this news release constitute forward-looking statements or information (collectively, "forward-looking statements") within the meaning of applicable securities legislation. Forward-looking statements are typically identified by words such as "anticipate", "continue", "estimate", "expect", "forecast", "may", "will", "project", "could", "plan", "intend", "should", "believe", "outlook", "potential", "target" and similar words suggesting future events or future performance. In particular, this news release contains, without limitation, forward-looking statements concerning the proposed acquisition by the Company of the Bank through the acquisition of all of the issued and outstanding shares of 6676405, including the impact of the Transaction on the Company and timing for closing of the Transaction.

With respect to forward-looking statements contained in this news release, the Company has made assumptions regarding, among other things, the timing of receipt of appeal periods for the Settlement Agreement,, the ability of the Company to complete the Settlement Agreement and the ability of the Company to execute and realize on the anticipated benefits of the Settlement Agreement.

Although the Company believes that the expectations reflected in the forward looking statements contained in this news release, and the assumptions on which such forward-looking statements are made, are reasonable, there can be no assurance that such expectations will prove to be correct. Readers are cautioned not to place undue reliance on forward-looking statements included in this news release, as there can be no assurance that the plans, intentions or expectations upon which the forward-looking statements are based will occur. By their nature, forward-looking statements involve numerous assumptions, known and unknown risks and uncertainties that contribute to the possibility that the predictions, forecasts, projections and other forward-looking statements will not occur. These risks and uncertainties include, among other things, the failure of the Company to receive required approvals to the Transaction in a timely manner, or at all, delays in completing the Transaction and the risk that the Company may not complete the transaction and the other factors described under "Risk Factors" in the Company's most recently filed Annual Information Form available in Canada at www.sedar.com. Readers are cautioned that this list of risk factors should not be construed as exhaustive.

The forward-looking statements contained in this news release speak only as of the date of this news release. Except as expressly required by applicable securities laws, the Company does not undertake any obligation to publicly update or revise any forward looking statements, whether as a result of new information, future events or otherwise. The forward-looking statements contained in this news release are expressly qualified by this cautionary statement.

About DCPayments
The Company is the largest branded ATM provider in Canada and Australia, and the third largest branded ATM provider in the United Kingdom. DC Payments is one of the leading providers of credit union and other financial institution processing and outsourcing services, branded non-financial institution debit terminals and prepaid card products in Canada. DC Payments also offers ATM services in Mexico and New Zealand.

Additional information about DCPayments is available on SEDAR (www.sedar.com) or DCPayments' website at www.directcash.net.

Contact Information

  • For further information please contact:

    Amanda J. Gallacher
    Vice President, Corporate Strategy & Acquisitions
    Direct Telephone: (403) 387-2158
    Fax: (403) 451-3058
    e-mail: investorrelations@directcash.net

    or

    Jeffrey J. Smith
    President & Chief Executive Officer
    Direct Telephone: (403) 387-2101
    Fax: (403) 451-3001
    e-mail: jeff@directcash.net