Acasta Enterprises Inc. Announcement

Apr 02, 2019 12:22 pm

Acasta Enterprises Inc. (TSX: AEF) (“Acasta” or the “Company”) today announced that, after due consideration, it has determined to unwind the previously announced conversion (the “Conversion”) of high yield secured debt that had been converted into Class B Shares of the Company on February 22, 2019.

Although the Conversion had received the approval of the Toronto Stock Exchange (the “TSX”), was effected in accordance with all applicable TSX policies and was determined by the independent board members to have been in the best interests of the Company and reasonable under the circumstances, two shareholders have opposed the Conversion and have commenced proceedings before the Ontario Securities Commission seeking to review the TSX’s decision in approving the Conversion.

Despite the fact that the Conversion would have saved the Company a significant amount of interest payments during 2019, the Company has been advised that the anticipated costs of a litigation over this issue would exceed these cost savings. In addition, during this critical phase in the Company’s operational turnaround, it was determined that further management distraction over what was anticipated to have been a straightforward cost-saving matter would not be beneficial to the Company or its shareholders.

The Conversion is expected to be reversed with an effective date of April 5, 2019.

The Company also advises that it has scheduled its annual and special meeting of shareholders for Tuesday May 14, 2019. The venue and time of such meeting will be specified in the Company’s proxy materials to be distributed to shareholders in connection with the meeting.


Cautionary Note Concerning Forward Looking Statements

This news release includes forward looking statements. All such statements constitute forward looking information within the meaning of applicable securities law and are made pursuant to the “safe harbour” provisions of applicable securities laws. Forward looking statements include, but are not limited to statements about other anticipated future events or results, including comments with respect to the timing of the reversal of the Conversion. Forward looking statements are statements that are predictive in nature, depend upon or refer to future events or conditions and are identified by words such as “will”, “expects”, “anticipates”, “intends”, “plans”, “believes”, “estimates” or similar expressions concerning matters that are not historical facts. Such statements are based on current expectations of the Company’s management and inherently involve numerous risks and uncertainties, known and unknown, including economic factors. The forward-looking information contained in this news release is presented for the purpose of assisting readers in understanding the Company’s business and strategic priorities and objectives. A number of risks, uncertainties and other factors may cause actual outcomes or financial results to differ materially from the forward looking statements contained in this news release, including, among other factors, those referenced in the section entitled “Risk Factors” in the Company’s annual information form for the year ended December 31, 2018, a copy of which is available on the SEDAR website at under the Company’s profile. Forward looking statements contained in this news release are not guarantees of future outcomes performance and, while forward looking statements are based on certain assumptions that the Company considers reasonable, actual events could differ materially from those expressed or implied by forward looking statements made by the Company. Readers are cautioned to consider these and other factors carefully when making decisions with respect to the Company and to not place undue reliance on forward looking statements. Circumstances affecting the Company may change rapidly. Except as may be expressly required by applicable law, Acasta does not undertake any obligation to update publicly or revise any such forward looking statements, whether as a result of new information, future events or otherwise. These cautionary statements expressly qualify all forward looking statements in this new release.

Acasta Enterprises Inc.
Fred Leigh