Fondren and JEC Capital Announce Agreement Regarding Common Shares of Photon Control Inc.

HOUSTON, TEXAS--(Marketwired - Oct. 12, 2016) -

NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES

BLR Partners LP ("BLR Partners"), BLRPart, LP ("BLRPart GP"), BLRGP Inc. ("BLRGP"), Fondren Management, LP ("Fondren Management"), FMLP Inc. ("FMLP"), The Radoff Family Foundation ("Radoff Foundation") and Bradley L. Radoff (together with BLR Partners, BLRPart GP, BLRGP, Fondren Management, FMLP and Radoff Foundation, "Fondren") of 1177 West Loop South, Suite 1625, Houston, Texas 77027, and JEC II Associates, LLC ("JEC II Associates"), JEC Capital Partners, LLC ("JEC Capital") and K. Peter Heiland of 68 Mazzeo Drive, Randolph, Massachusetts 02368 (together with JEC II Associates and JEC Capital, "JEC" and together with Fondren, the "Acquirors") entered into an agreement effective October 12, 2016 (the "Group Agreement") in connection with their respective holdings of common shares (the "Shares") of Photon Control Inc. ("Photon"), Suite 200, 8363 Lougheed Highway, Burnaby, British Columbia, V5A 1X3.

Pursuant to the Group Agreement, Fondren and JEC agreed to (i) engage in discussions with Photon regarding means to enhance stockholder value and corporate governance, (ii) take all other action necessary to achieve the foregoing and (iii) take any other actions the members of Fondren and JEC determine to undertake in connection with their respective investment in Photon, and includes agreements regarding the joint filing on behalf of each of them of regulatory filings with respect to the securities of Photon to the extent required by applicable laws in Canada and the United States of America.

The requirement to issue this press release was triggered by the entering into of the Group Agreement. Immediately prior to the effectiveness of the Group Agreement, BLR Partners directly owned 5,400,000 Shares, representing approximately 5.16% of Photon's issued and outstanding common shares on a non-diluted basis, based upon the 104,685,518 common shares of Photon (the "Outstanding Photon Shares") stated to be issued and outstanding as at August 24, 2016, by Photon in its management's discussion and analysis of operations and financial condition for the three and sixth month period ended June 30, 2016 and filed on www.SEDAR.com on August 24, 2016, 2016; Radoff Foundation directly owned 500,000 Shares, representing approximately 0.48% of the Outstanding Photon Shares; Mr. Radoff directly owned 1,750,000 Shares, representing approximately 1.67% of the Outstanding Photon Shares; and JEC II Associates directly owned 2,900,000 Shares, representing approximately 2.77% of the Outstanding Photon Shares. Consequently, the Fondren group held a total of 7,650,000 Shares representing approximately 7.31% of the Outstanding Photon Shares and the JEC group held 2,900,000 Shares representing approximately 2.77% of the Outstanding Photon Shares immediately prior to the entering into of the Group Agreement. As a result of the entering into of the Group Agreement, the Acquirors collectively own 10,550,000 Shares of Photon, representing approximately 10.08% of the Outstanding Photon Shares.

The 5,400,000 Shares of Photon purchased by BLR Partners were purchased at an average price of $0.7131 per share for a total purchase price of $3,850,806. The 500,000 Shares of Photon purchased by Radoff Foundation were purchased at an average price of $0.7212 per share for a total purchase price of $360,575. The 1,750,000 Shares of Photon purchased by Mr. Radoff were purchased at an average price of $0.7233 per share for a total purchase price of $1,265,725. The 2,900,000 Shares of Photon purchased by JEC II Associates were purchased at an average price of $0.7200 per share for a total purchase price of $2,088,000.

The Acquirors acquired the Shares of Photon for investment purposes and may, from time to time, depending upon overall market conditions, other investment opportunities available to the Acquirors, and the availability of Shares at prices that would make the purchase or sale of Shares desirable, on an individual or joint basis, acquire additional securities of Photon, dispose of some or all of the existing or additional securities they now hold or will acquire, or they may continue to hold their current position, in accordance with the objectives set out in this report. The Acquirors may, from time to time, on an individual or joint basis, take such actions as they consider necessary or desirable to pursue such objectives, subject to applicable law.

The Acquirors have engaged and intend to continue to engage in discussions with Photon's board of directors (the "Board") and management team regarding adding highly qualified director candidates to the Board to benefit Photon.

The Acquirors do not currently intend to solicit proxies from Photon shareholders and Photon has not called a meeting of shareholders; however, to the extent the Board does not engage in constructive discussions with the Acquirors regarding adding highly qualified candidates to the Board, which discussions do not result in a satisfactory outcome in the opinion of the Acquirors, the Acquirors reserve their rights to solicit proxies at any annual and special meetings of shareholders of Photon to seek the election of highly qualified director candidates, subject to applicable laws.

The Acquirors intend to review their investment in Photon on a continuing basis. Depending on various factors including, without limitation, Photon's financial position and investment strategy, the price levels of the Shares, conditions in the securities markets and general economic and industry conditions, the Acquirors may in the future take such actions with respect to their investment in Photon as they deem appropriate including, without limitation, engaging in communications with management and the Board of Photon, engaging in discussions with shareholders of Photon and others about Photon and the Acquirors' investment, making proposals to Photon concerning changes to the capitalization, ownership structure, Board structure (including Board composition) or operations of Photon, purchasing additional Shares, selling some or all of their Shares, engaging in short selling of or any hedging or similar transaction with respect to the Shares, or changing their intention with respect to any and all matters referred to in this press release, subject to applicable laws.

This press release is issued pursuant to National Instrument 62-103 - The Early Warning System and Related Take-Over Bid and Insider Reporting Issues, which also requires a report to be filed with regulatory authorities in each of the jurisdictions in which Photon is a reporting issuer containing information with respect to the foregoing matters (the "Early Warning Report"). A copy of the Early Warning Report will appear with Photon's documents on the System for Electronic Document Analysis and Retrieval (www.SEDAR.com) and may also be obtained by contacting Greg Lempel of Fondren Management at 713-482-2196. The issuance of this news release is not an admission that an entity named in the news release owns or controls any described securities or is a joint actor with another named entity.