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Thirdcoast Limited continues to attempt to frustrate Thirdcoast
shareholders' right to decide for themselves on P&H's cash offer, and
has now notified P&H that it intends to push through a sale of the
Goderich terminal without the approval of Thirdcoast shareholders as soon as July 3, 2012, prior to the July 4, 2012 Ontario Securities
Commission hearing at which time P&H is seeking to cease trade the
shareholder rights plan instituted without the consent of Thirdcoast shareholders
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P&H continues to use all effective means to support shareholders' right
to receive timely payment for Thirdcoast shares they choose to tender
to P&H
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P&H recognizes and appreciates the significant shareholder support to
date and encourages all shareholders who wish to tender (sell) their
shares at a 107% premium to tender their shares as soon as possible to
avoid missing this opportunity
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P&H remains committed to the local Goderich economy
WINNIPEG, June 26, 2012 /CNW/ - Parrish & Heimbecker, Limited ("P&H") is providing an update today as to (1) the status of its bid to acquire
any and all of the issued and outstanding Thirdcoast Limited ("Thirdcoast") common shares not presently owned by it (the "Bid") for cash consideration of $155.00 per common share (a premium of
approximately 107% based on the posted bid price immediately before
announcement of the Bid) subject to the terms and conditions set out in
the Bid circular and related documentation dated May 31, 2012, and (2)
the extraordinary efforts of Thirdcoast management and Committee of
Directors to prevent Thirdcoast shareholders from having the
opportunity to accept the Bid.
Thirdcoast Continues to Attempt to Frustrate Shareholders Wishing to
Benefit from P&H's Cash Offer
Management of Thirdcoast and the committee of the board of directors of
Thirdcoast made up of Ian Carter and Robert Paterson (the "Committee of Directors") continue to use Thirdcoast funds to fight an enormously expensive
battle in an attempt to keep shareholders of Thirdcoast from being able
to exercise their fundamental right to sell their shares, and to
entrench management's extremely lucrative roles with the company. In
the interim, the best interests of shareholders of Thirdcoast continue
to be disregarded:
Attempt to Sell the Company's "Crown Jewel" Without Shareholder Approval
- P&H has been formally advised by Thirdcoast that the Committee of
Directors and management intend to enter into a binding agreement to
sell the Goderich, Ontario terminal asset (the "Asset Sale") as early as July 3, 2012, without seeking approval from Thirdcoast shareholders and without having
made any public announcement of its intentions. Given the strategic significance of the Goderich terminal to
Thirdcoast, P&H believes the Asset Sale is being pursued by management
and/or the Committee of Directors as an improper defensive tactic
designed to thwart the right of Thirdcoast shareholders' to decide for
themselves whether to sell their shares, and is in violation of
applicable corporate/securities laws.
Excessive Bonuses and Salaries - The Committee of Directors have paid management hugely above-market
salaries and bonuses as shown in Thirdcoast's March 31, 2012 annual
financial statements released last week which reveal executive
compensation increasing by almost 70% from $1,071,500 in the prior year
to $1,704,408 in fiscal 2012.
Exceedingly Rich Change in Control Severance Payments: Management and Thirdcoast have adopted employment contracts with rich
severance payments that are triggered upon termination of certain
executives following a change in control of the company, all without
transparency to shareholders and without shareholder approval.
Lack of Independent Advice - Management and the Committee of Directors have ignored proper corporate
governance practices and the rules of process designed to protect
shareholder interests by not retaining independent legal advice: over
P&H's formal objections, the Committee of Directors chose to retain the
company's legal counsel as its own counsel, thereby ensuring that the
legal advice it received would not be independent from Thirdcoast
management.
Thwarting Shareholders' Right to Liquidity and Right to Choose to Tender
to the Bid - Management and the Committee of Directors continue to drag out the
takeover bid process as long as they possibly can, including trying to
put a rights plan (poison pill) (the "Rights Plan") in place without requesting approval of the Rights Plan from shareholders. The effect of the Rights Plan is to prevent P&H from taking up shares
tendered to its bid. Over 125 days have elapsed since P&H initially made the Committee of
Directors aware of its intention to make the Bid and yet the Rights
Plan was purportedly adopted at the end of May, 2012 on the eve of
P&H's Bid.
Hearing Before the Ontario Securities Commission
In response to the Committee of Directors and Thirdcoast management's
defensive tactics, P&H has applied to securities regulators to cease trade the Rights Plan, and advises that a hearing before the Ontario Securities Commission
(the "OSC") is scheduled to be held on July 4, 2012. P&H believes that the Rights
Plan is an improper defensive tactic. If successful in its
application, the Rights Plan will be struck down which will allow
shareholders to decide for themselves whether they wish to accept the
Bid. Provided that the Rights Plan is cease-traded by the OSC, P&H
intends (in accordance with the terms and conditions of the Bid) to
take up (purchase) all shares that Thirdcoast shareholders have chosen
to tender to the Bid on expiry, which is currently set for July 5,
2012.
P&H has received numerous inquiries from Thirdcoast shareholders as to
the effect of the Rights Plan on the Bid. P&H wishes to emphasize that the purported adoption of the Rights Plan
has not affected P&H's decision to proceed with the Bid. P&H has
received strong support from shareholders to date and shares
representing approximately 60% of the outstanding share capital when
combined with the shares held by P&H have already shown their support
for the Bid and tendered or are projected to tender their shares, such
that P&H will control the company upon take up of shares tendered to
the Bid. This is in spite of the Committee of Directors' continuing efforts to
thwart the Bid.
To be clear, Thirdcoast shareholders may still tender to the Bid
notwithstanding the existence of the Rights Plan, and shareholders are
strongly urged to show their support for the Bid and the cease trading
of the Rights Plan by tendering as soon as possible. See "Instructions for Tendering Shares" below.
Proceedings Before the Ontario Superior Court of Justice
Thirdcoast Attempt to Thwart the Bid by Selling off the Company's "Crown
Jewel" Without Shareholder Approval - P&H believes that Thirdcoast management and the Committee of Directors
are pursuing the sale of the Goderich terminal, in violation of
applicable corporate/securities laws, to thwart the right of Thirdcoast
shareholders' to decide for themselves whether to accept the Bid. P&H
believes that under applicable law, an Asset Sale of this magnitude
(the sale of Thirdcoast's "crown jewel" - the Goderich terminal) would,
among other things, require approval by way of a special resolution
passed by the vote of shareholders present in person or by proxy at a
properly constituted meeting holding in the aggregate two-thirds of the
votes cast at the meeting. To protect shareholder rights and the
integrity of the Bid, P&H has commenced proceedings before the Ontario
Superior Court of Justice and is actively seeking an injunction to
prevent the Asset Sale. P&H will vigorously defend the rights of Thirdcoast shareholders before
the Court by seeking to prevent or overturn any purported sale of this
type.
Shareholders should also note that an Asset Sale provides no guarantee
of any cash distribution to Thirdcoast shareholders and creates
substantial corporate tax costs and transaction costs to the detriment
of Thirdcoast shareholders. It has no purpose other than entrenching
current management and the Committee of Directors and does nothing to
provide value to shareholders. The Bid is the only real, concrete and clear avenue for maximizing
shareholder value.
The timing of the purported Asset Sale is also extremely suspect. On
Friday June 22, 2012, Thirdcoast gave P&H ten days' notice (as required
by the Court) that "Thirdcoast intends to enter into an agreement with
a third party for the sale of its Goderich terminal on or shortly after
July 3, 2012" (again, without seeking shareholder approval as P&H
believes is required by law) - the day immediately prior to the date
the OSC (whose role it is to protect shareholders and the integrity of
the capital markets) has the opportunity to rule on cease-trading
(effectively terminating) the Rights Plan that was instituted without
the approval of Thirdcoast shareholders. P&H believes that the
Committee of Directors' intention is to commit Thirdcoast to a binding
agreement that could cause P&H to withdraw the Bid due to the sale of
the Goderich terminal, and thereby do an end-run around the OSC's
hearing on the propriety of the Rights Plan and prevent Thirdcoast
shareholders from deciding for themselves whether to tender their
shares to the Bid.
In short, P&H believes that an Asset Sale (or a binding agreement in
respect thereof) effective July 3, 2012, one day before the OSC hearing
to consider the Rights Plan, is designed to circumvent the OSC's
authority over the takeover bid process and thwart the Bid before
securities regulators have even had an opportunity to address the
Committee of Directors' inappropriate conduct. The actions taken by
Thirdcoast by and through management and the Committee of Directors are
illustrative of their lack of respect for the takeover bid process,
securities regulators and most importantly for the shareholders of
Thirdcoast and their fundamental right to deal with their shares as
they see fit.
Tendering common shares to the Bid now will show shareholder support for
the Bid and opposition to the continued oppressive conduct of Thirdcoast management and the Committee
of Directors.
P&H assures shareholders of Thirdcoast that it has and will continue to
oppose any attempted tactics of Thirdcoast that could deprive the
shareholders of Thirdcoast of the opportunity to realize upon P&H's
cash offer by participating in the Bid. Shouldn't Thirdcoast
shareholders have the right to decide on the future of their company?
P&H's Commitment to the Town and People of Goderich, Ontario:
After successful completion of the Bid, it remains P&H's intention to
increase activity within Thirdcoast's business operations and to
continue the operation of Thirdcoast's grain handling facilities under
the existing public house model with the intent of continuing "business
as usual" and providing access to the existing and future customers of
Thirdcoast at its elevator and terminal facilities.
P&H also intends to proceed with all necessary steps to change the name
of Thirdcoast to its previous name of "Goderich Elevators Limited" as
soon as possible after completion of the Bid.
Instructions for Tendering Shares:
Thirdcoast shareholders may tender their common shares to the Bid by returning the letter of transmittal (printed on YELLOW paper)
enclosed with the Bid materials mailed to them, together with
certificate(s) representing the common shares of Thirdcoast (valid
share certificates in the name of Goderich Elevators Limited will also
be accepted), to Olympia Transfer Services Inc. in accordance with the
rules and instructions set forth in the letter of transmittal
accompanying the Bid materials.
Shareholders whose common shares are registered in the name of an
investment dealer, stockbroker, bank, trust company or other nominee,
should contact such nominee immediately for assistance on how to
deposit common shares under the P&H Bid.
Thirdcoast shareholders may also obtain a free copy of the Bid documents
online at www.sedar.com.
Forward-Looking Statements
This release includes forward-looking statements regarding P&H,
Thirdcoast and their respective businesses. The forward looking events
and circumstances discussed in this release may not occur and actual
results could differ materially as a result of known and unknown risk
factors and uncertainties affecting P&H, Thirdcoast and their
respective businesses. No forward-looking statement can be guaranteed.
Forward-looking statements speak only as of the date on which they are
made and P&H does not undertake any obligation to publicly update or
revise any forward-looking statement, whether as a result of new
information, future events, or otherwise.
About P&H
Winnipeg, Manitoba-based Parrish & Heimbecker, Limited is a 103 year old
privately held Canadian company with grain elevators, terminals and
flour mills across Canada. P&H has grown into a diversified, vertically
integrated company that is committed to agribusiness and the entire
agri-food industry. The P&H group of companies covers a wide spectrum
of the agribusiness sector, mirroring very closely the diverse face of
Canadian agriculture. P&H is actively growing and adapting to meet
changing demands of the consumer. For more information, visit http://www.parrishandheimbecker.com.
This press release does not constitute an offer to buy or an invitation
to sell, or the solicitation of an offer to buy or invitation to sell,
any securities of Thirdcoast. Such an offer may only be made pursuant
to an offer and takeover Bid circular filed with applicable securities
regulatory authorities. THIRDCOAST SHAREHOLDERS SHOULD READ THE BID
DOCUMENTS CAREFULLY BECAUSE THEY CONTAIN IMPORTANT INFORMATION,
INCLUDING THE TERMS AND CONDITIONS OF THE BID.