VANCOUVER, April 11,
2014 /CNW/ - Run of River Power Inc. ("ROR
Power" or the "Company") (TSX-V: ROR) announces that it
has entered into a non-binding letter of intent (the "Letter of
Intent") with Concord Green Energy Inc. ("Concord") and its wholly-owned subsidiary
ROR Acquisition Ltd. ("AcquireCo"), and 0999130 B.C. Ltd.
("REC Acquirer") with respect to a proposed plan of
arrangement under section 288 of the Business Corporations
Act (British Columbia) among
ROR Power, its wholly-owned subsidiary Rockford Energy Corporation
("REC"), Concord,
AcquireCo, REC Acquirer and the holders (the "Shareholders")
of the common shares (each, a "ROR Share") in the capital of
ROR Power (collectively, the "Arrangement").
The Letter of Intent is non-binding and sets out
the proposed terms of the Arrangement based on the current
understanding of the parties. The parties are in the process
of negotiating a definitive arrangement agreement (the
"Arrangement Agreement") which, if entered into, is expected
to set out the terms and conditions on which the Arrangement will
be completed.
The Letter of Intent provides that the proposed
Arrangement is intended to effect: (i) the sale by ROR Power of all
of the issued and outstanding common shares in the capital of REC
(each, a "REC Share") and of the outstanding
shareholders loans advanced by ROR to REC (collectively, the
"REC Loans") to REC Acquirer (the "REC Disposition")
such that REC, which owns the Brandywine Creek Project, will become
a wholly-owned subsidiary of REC Acquirer; (ii) the sale by the
Shareholders to AcquireCo of all of the issued and outstanding ROR
Shares (the "ROR Disposition") and the amalgamation of
AcquireCo and ROR Power (the "Amalgamation") such that the
amalgamated company will become a wholly-owned subsidiary of
Concord; (iii) the repayment of
certain liabilities of ROR Power which are incurred on or before
closing of the Arrangement (the "Debt Repayment"); and
(iv) the distribution of cash consideration (the "ROR
Consideration") to the Shareholders for their ROR
Shares.
In addition, the Letter of Intent proposes that
in connection with the proposed Arrangement, AcquireCo will advance
$1,250,000 (the "Advance") to
ROR which, together with the cash portion of the $8,040,000 (the "REC Consideration") to be
paid by REC Acquirer pursuant to the REC Disposition and any cash
ROR Power has on closing of the Arrangement (the "Closing"),
will constitute the funds available to the amalgamated company
(the "Available Funds") from which the Debt Repayment
will be completed and from which the ROR Consideration will be paid
to the Shareholders. The REC Consideration is expected to be
paid partly in cash and partly by the tendering of certain
debentures and convertible debentures of ROR that are outstanding,
and Concord is expected to not
require the repayment of certain amounts owing to Concord prior to Closing. The aggregate
ROR Consideration is expected to be the amount resulting from the
deduction of the payments made in respect of ROR liabilities
incurred on or before the Closing date from the Available Funds,
and is expected to be distributed to the Shareholders on a pro rata
basis following a post-Closing holdback period of approximately 90
days. The aggregate amount of the ROR liabilities to be
deducted from the Available Funds prior to distribution of the ROR
Consideration is not known at this time.
If an Arrangement Agreement is entered into, the
Closing of the Arrangement will remain subject to a number of
conditions including, among other things: receipt of the requisite
approval of the Shareholders including approval of the majority of
the disinterested Shareholders pursuant to Multilateral Instrument
61-101 Protection of Minority Security Holders in Special
Transactions, approval of the TSX Venture Exchange, approval of
the Supreme Court of British
Columbia, and dissent rights not being exercised with
respect to more than 5% of the issued and outstanding ROR Shares in
connection with Shareholder approval of the Arrangement.
Also, if an Arrangement Agreement is entered
into, ROR Power intends to call a meeting of the Shareholders to
consider approval of the Arrangement, and in connection with such a
meeting intends to obtain a fairness opinion with respect to the
Arrangement and to provide Shareholders with an information
circular which includes additional disclosure regarding the
Arrangement.
Concord and
AcquireCo are both private British
Columbia corporations that have an arm's length relationship
with ROR Power. REC Acquirer is a private British Columbia company of which is
beneficially owned by certain holders of outstanding debentures and
convertible debentures of ROR Power. Peter
Zell, a director and significant shareholder of ROR Power,
and Brett Robinson, a director of
ROR Power, are directors of REC Acquirer. Information in this
news release concerning the ownership and directors of REC Acquirer
has been provided to ROR Power by REC Acquirer.
Following Closing, subject to the requisite
Shareholder and regulatory approvals being obtained, the ROR Shares
are expected to be voluntarily de-listed from the TSX Venture
Exchange and ROR Power is expected to cease to be a reporting
issuer in British Columbia and
Alberta.
About Run of River Power Inc.
ROR Power develops renewable, sustainable energy
through its portfolio of clean energy projects. The company helps
diversify BC's energy mix by providing a cleaner way to generate
power and increasing the security of BC's energy supply. ROR Power
operates an Eco Logo© certified hydroelectric power generation
station at Brandywine Creek, near Whistler, BC that provides green power for
about 4,000 homes.
Disclaimer Regarding Forward Looking
Information
Certain information included in this press
release constitutes forward-looking information under applicable
securities legislation. Forward-looking information typically
contains statements with words such as "anticipate", "believe",
"expect", "plan", "intend", "estimate", "propose", "project" or
similar words suggesting future outcomes or statements regarding an
outlook, or statements that certain events or conditions "may"
occur. Forward-looking information in this press release
includes, but is not limited to, statements regarding the
expectations of management of ROR Power regarding: (i) the
Arrangement; (ii) completion of the Arrangement; (iii) entry into
the Arrangement Agreement; (iv) the intended results of the
Arrangement; (v) the conditions to completion of the Arrangement;
(vi) the calculation of and timing for payment of the ROR
Consideration to the Shareholders; (vii) the Shareholders' meeting
in connection with the Arrangement; (viii) receipt of a fairness
opinion in connection with the Arrangement; (ix) the preparation
and delivery of an information circular in connection with a
Shareholders meeting to consider the Arrangement; and * the
proposed de-listing of the ROR Shares and the proposed ceasing to
be a reporting issuer of ROR Power.
Although ROR Power believes that the expectations
reflected in the forward-looking information are reasonable, undue
reliance should not be placed on forward-looking information
because ROR Power can give no assurance that such expectations will
prove to be correct. Such forward-looking statements are
subject to risks and uncertainties that may cause actual results,
performance or developments to differ materially from those
contained in the statements including, without limitation, the
risks that: (1) the Arrangement may not be completed for any reason
whatsoever, including that the requisite Shareholder, court and/or
regulatory approval of the Arrangement may not be obtained or that
AcquireCo and/or the REC Acquirer may not have the necessary funds
to make the Advance and the REC Consideration available to ROR
Power; (2) an Arrangement Agreement may never be entered into for
any reason whatsoever, including that the parties may not agree on
the definitive terms; (3) the Arrangement, if completed, may not
have the intended effect as set out in this news release; (4) the
aggregate amount of the ROR liabilities to be deducted from the
Available Funds may be significant, and the resulting ROR
Consideration, if any, may be nominal; (5) the meeting of
Shareholders to consider the Arrangement may not occur; (6) a
fairness opinion may not be obtained, or if obtained, may not
provide a favourable opinion as to the fairness of the Arrangement;
(7) the information circular and other materials for the meeting of
Shareholders may not be prepared or delivered to Shareholders as
expected; (8) the ROR Shares may not be de-listed and ROR may not
cease to be a reporting issuer following Closing for any reason
whatsoever, and (9) such other risks and uncertainties beyond the
control of ROR Power.
Readers are cautioned that the foregoing list is
not exhaustive of all factors and assumptions which have been used.
The forward-looking information contained in this press release is
made as of the date hereof and ROR Power undertakes no obligation
to update publicly or revise any forward-looking information,
whether as a result of new information, future events or otherwise,
unless required by applicable securities laws. The forward
looking information contained in this press release is expressly
qualified by this cautionary statement.
Neither 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.
SOURCE Run of River Power Inc.