Bluedrop Completes Acquisition of Atlantis Systems Corp.
HALIFAX, NOVA SCOTIA--(Marketwired - Dec 31, 2013) - Bluedrop
Performance Learning Inc. ("Bluedrop") (TSX-VENTURE:BPL) and
Atlantis Systems Corp. ("Atlantis") (NEX:AIQ.H) jointly announced
today that they have completed the previously announced plan of
arrangement (the "Arrangement") pursuant to which Bluedrop, through
its wholly-owned subsidiary 8682259 Canada Inc., acquired all of
the common shares of Atlantis ("Atlantis Shares") for aggregate
cash consideration of C$1,000,000 or approximately C$0.0276 for
each Atlantis Share.
Emad Rizkalla, founder and CEO of Bluedrop, said, "This is a
transformative transaction for Bluedrop's defence business and its
shareholders and firmly establishes Bluedrop as one of Canada's
leading defence training and simulation companies. Atlantis brings
a very complementary customer base, an excellent resume of
experience and a very capable delivery team. We intend to quickly
integrate the Atlantis operations into the existing Bluedrop
defence activities and expect to reduce operating expenses in the
range of C$3,000,000 per year after we have absorbed the onetime
cost of staff reductions and rationalization of overhead
costs."
Atlantis was founded in the 1970's and has built and delivered a
suite of maintenance trainers and flight training devices for
various military aircraft including the CF-18 fighter and Black
Hawk and Sea Hawk helicopters, and for civilian aircraft, including
the Boeing 747 and 767, as well as the Airbus A320. In 2007,
Atlantis acquired the Eduplus Division of Tecsult Inc. and entered
the training delivery business that has evolved to become its
largest revenue generator in recent years. Atlantis reported
revenues of approximately C$8,206,000 for the trailing 12 months
from September 30, 2012. Atlantis customers include Allied Wings,
Lockheed Martin, Sikorsky, CAE, Calian, Department of National
Defence (Canada), Fleetway (Irving), and various other aerospace
clients.
Mike O'Rourke, the COO of the Bluedrop Defence and Aerospace
group, will be joined by Bill Bartlett, the former CFO of Atlantis,
who will join the Bluedrop Corporate group as VP of Finance with
responsibility for the Defence and Aerospace group and US
operations. Mike O'Rourke, said, "The integration plans are well
underway and customers are well informed and excited about the
transaction. We expect to achieve our cost savings targets quickly
and integrate the Atlantis and Bluedrop teams into one operation at
our Halifax office. The expanded customer base and capabilities
acquired from Atlantis will make the Bluedrop team more capable and
responsive to our customer requirements."
Bluedrop financed the acquisition through the issuance of
unsecured convertible debentures to Difference Capital Financial
Inc. ("Difference") on December 30, 2013. The debentures are
convertible at a conversion rate of C$0.15 per Bluedrop common
share, have a term of three years and bear interest at the rate of
14% per annum.
Difference's Executive Vice-Chairman, Paul Sparkes, stated, "We
are very enthusiastic about being a part of the Bluedrop and
Atlantis strategic plan. We believe that this combination of two
leading Canadian suppliers of military and aerospace computer-based
training products will create an even stronger organization that is
poised to take advantage of the robust outlook for the e-training
industry."
Prior to the completion of the Arrangement, Atlantis and ComVest
Capital, LLC ("ComVest"), Atlantis' controlling shareholder prior
to the completion of the Arrangement, reorganized the terms of
ComVest's existing debt with Atlantis by (i) converting a
convertible note held by ComVest (which had an outstanding
principal balance, together with accrued interest thereon, of
USD$7,799,795 as of December 30, 2013) into 25,999,315 Atlantis
Shares, and (ii) amending an existing term note held by ComVest
(the "CV Term Note", which had an outstanding principal balance,
together with accrued interest thereon, of USD$6,675,365 as of
October 31, 2013 and bore interest at the rate of 12% per annum)
to, among other things, reduce the total indebtedness thereunder to
CDN$2,500,000. The indebtedness under the amended CV Term Note is
evidenced by two secured notes issued by Atlantis to ComVest on the
closing of the Arrangement, one of which is convertible into
Bluedrop common shares in certain circumstances.
As a result of the Arrangement, the Atlantis Shares will be
delisted from the TSX Venture Exchange effective as of the close of
business today.
Forward Looking Information
Certain information contained in this news release, including
any information relating to the Arrangement and Bluedrop's and
Atlantis' future financial or operating performance may be deemed
"forward-looking". These statements relate to future events or
future performance and reflect Bluedrop's and Atlantis'
expectations regarding the Arrangement, and the future growth,
results of operations, business prospects and opportunities of the
combined enterprise. These forward-looking statements also reflect
the parties' current internal projections, expectations or beliefs
and are based on information currently available to Atlantis and
Bluedrop. In some cases forward-looking information can be
identified by terminology such as "may", "will", "should",
"expect", "intend", "plan", "anticipate", "believe", "estimate",
"projects", "potential", "scheduled", "forecast", "budget" or the
negative of those terms or other comparable terminology.
Assumptions upon which such forward looking information regarding
the Arrangement is based include that Atlantis and Bluedrop will be
able to complete the post-closing aspects of the Arrangement and
that the expected synergies and cost savings associated with the
Arrangement will be realized. Although Atlantis and Bluedrop
believe that the expectations reflected in such forward-looking
statements are reasonable, they can give no assurance that such
expectations will prove to have been correct. Atlantis and Bluedrop
caution that actual performance will be affected by a number of
factors, many of which are beyond their control, and that future
events and results may vary substantially from what they currently
foresee. Accordingly, readers are cautioned against placing undue
reliance on forward-looking information. Atlantis and Bluedrop
expressly disclaim any intention or obligation to update or revise
any forward-looking information, whether as a result of new
information, events or otherwise, except in accordance with
applicable securities laws. Discussion of the various factors that
may affect future results are contained in Bluedrop's condensed
interim financial statements for the nine months ended June 30,
2013 and the management's discussion and analysis thereon, which
are available at www.SEDAR.com and in Atlantis' audited financial
statements for the year ended December 31, 2012 and the management
discussion and analysis thereon dated April 25, 2013, and Atlantis'
condensed interim financial statements for the nine months ended
September 30, 2013 and management's discussion and analysis thereon
dated November 26, 2013 which are available at www.SEDAR.com.
Atlantis' and Bluedrop's forward-looking statements are expressly
qualified in their entirety by this cautionary statement.
Neither the TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release.
About Bluedrop
Bluedrop Performance Learning Inc. (TSX-VENTURE:BPL) is an
innovator in workplace training for individuals, corporations,
defence and aerospace, and governmental clients. Launched in 2004,
the company has six offices and over 120 employees. Bluedrop is
transforming the workplace globally by designing, developing and
delivering some of the most effective and scalable skills
development programs. Bluedrop was recently recognized as one of
the Top 3 eLearning companies in Canada by Backbone Magazine in
their "Best of Everything in Canadian Tech" issue. For more
information, visit www.bluedrop.com.
Bluedrop Performance Learning Inc.Bernie
Beckett709-739-4938Berniebeckett@bluedrop.com
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