Dominion Citrus Announces Shareholder Meeting to A

TORONTO, Sept. 29, 2017 (GLOBE NEWSWIRE) -- Dominion Citrus Limited (" DCL " or “ Dominion Citrus ”) announces that a shareholders meeting (the “ Meeting ”) will be held on November 28, 2017 at 10:00 a.m. at the offices of Dickinson Wright LLP, Suite 2200, 199 Bay Street, Toronto, Ontario, to approve an Arrangement Agreement between DCL and Dominion Subco Inc. (“ Subco ”) and authorize DCL to complete a Plan of Arrangement pursuant to which Subco will acquire all of the 1,021,150 issued and outstanding Series A Preference Shares of Dominion Citrus (the “ Preference Shares ”) for $1.75 per Preference Share.  The Plan of Arrangement includes a settlement and release of all claims (if any) which holders of Preference Shares may have against DCL and its affiliates, without further payment.  Following the purchase of Preference Shares, Dominion Citrus and Subco will amalgamate to continue as Dominion Citrus Limited.

The proposed Plan of Arrangement is subject to shareholder approval (including approval by (i) at least 66 2/3% of votes cast by holders of the Common Shares and Preference Shares voting together in accordance with the Business Corporations Act (Ontario), (ii) at least 66 2/3% of the votes cast by holders of the Preference Shares voting separately as a class in accordance with the Business Corporations Act (Ontario) and (iii) a majority of the votes cast by ‘disinterested’ holders of Preference Shares as required by Multilateral Instrument 61-101).  The proposed Plan of Arrangement is also subject to court approval in accordance with the Business Corporations Act (Ontario) following approval by the shareholders. 

In connection with the proposed Plan of Arrangement, Dominion Citrus received from Klein Farber Corporate Finance Inc. (“ Klein Farber ”) a written valuation (the “ Valuation ”) that, subject to the assumptions, limitations and qualifications set out in the Valuation, the fair market value of all of the DCL Preference Shares as at July 1, 2017 is in the range of $0.00 to $0.45 million or approximately $0.00 per Preference Share to $0.44 per Preference Share.  The full text of the Valuation, which sets out, among other things, the assumptions made, information received and matters considered by Klein Farber in rendering the Valuation, as well as the limitations and qualifications to which the Valuation is subject, will be filed on DCL’s profile at www.sedar.com and will be attached to the Management Information Circular to be sent to all shareholders prior to the Meeting. 

The Preference Shares were listed on the Toronto Stock Exchange (the “ TSX ”) until February 18, 2016 at which time they were de-listed (following a 30-day trading ‘halt’) for failure to satisfy continued listing conditions prescribed by the TSX.  The proposed payment of $1.75 per share pursuant to the Plan of Arrangement represents (i) a 75% premium over the last trade of Preference Shares on the TSX prior to the delisting, a trade of 200 Preference Shares on January 13, 2016 at $1.00 per share, (ii) a premium of approximately 298% based on the 90-day weighted average price of $0.44 per share for the Preference Shares traded on the TSX in the 90-day period prior to the trading halt on January 18, 2016, and (iii) a premium of approximately 298% over the upper end of the range of values for the Preference Shares provided in the Klein Farber Valuation, namely $0.44 per share. 

In conjunction with the proposed Plan of Arrangement, DCL has entered into Voting and Support Agreements with several holders of Preference Shares holding in the aggregate 712,024 Preference Shares, representing approximately 69.72% of the issued and outstanding Preference Shares, whereby those holders of Preference Shares have agreed to vote all of the Preference Shares that they own or control in favour of the proposed Plan of Arrangement. 

Assuming that all shareholder approvals and court approvals are obtained, the purchase of Preference Shares by Subco, as the first step in the Plan of Arrangement, is expected to occur in or about the first week of December 2017, and the amalgamation of DCL and Subco, as the second step in the Plan of Arrangement, is expected to occur on December 31, 2017.

About Dominion Citrus

DCL and Subco are subsidiaries of Dominion Holding Corporation (“ DHC ”).  On July 29, 2016, DHC acquired for approximately $10.8 million in cash (i) all of the outstanding common shares of Dominion Citrus, (ii) approximately $19.258 million of secured Participating Notes (together with approximately $2.8 million of accrued unpaid interest thereon) owed by Dominion Citrus and (iii) an option to purchase a wholly owned subsidiary of DCL at its fair market value.  The Preference Shares of Dominion Citrus are publicly held by numerous shareholders.  Subco is wholly owned by DHC. 

Dominion Citrus is a diversified food company supplying fresh produce to a wide variety of customers in retail, foodservice and food distribution businesses. Dominion Citrus provides procurement, processing, repacking, sorting, grading, warehousing and distribution services to its major domestic markets being Ontario and Quebec. Dominion Citrus also supplies products to customers in the United States. Dominion Citrus’s website may be accessed at www.dominioncitrus.com .

Important Notice

This press release does not constitute an offer to buy or the solicitation of an offer to sell any securities of DCL.

Cautionary Note Regarding Forward-Looking Statements

This press release contains forward-looking information within the meaning of applicable securities laws (" forward-looking statements ") that relate to the proposed Plan of Arrangement. Such forward-looking statements involve known and unknown risks, uncertainties and other factors and assumptions that may cause the actual events in respect of the proposed Plan of Arrangement to differ materially from the anticipated events expressed or implied by such forward-looking statements. Such statements and factors include, but are not limited to: the proposed Plan of Arrangement and any further subsequent transaction; the ability to obtain shareholder approval on the terms as announced or at all; the outcome and merits of the proposed Plan of Arrangement; expected timing of the delivery and availability of circulars and relevant materials in connection with the proposed Plan of Arrangement; the effect that the proposed Plan of Arrangement may have on the operational or financial conditions of DCL; availability of financing if required in connection with the proposed Plan of Arrangement; developments in the capital markets; material adverse developments in DCL’s business; and other factors discussed under "Risk Factors" in DCL’s continuous disclosure materials and other documents filed and to be filed with Canadian provincial securities regulatory authorities.  Readers are cautioned not to place undue reliance upon any such forward-looking statements, which speak only as of the date made.  DCL does not undertake or accept any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements to reflect any change in its expectations or any change in events, conditions or circumstances on which any such statement is based, except as required by law.

For further information, please contact:

Paul Scarafile President & CEO

Dominion Citrus Limited 165 The Queensway, Suite 302 Toronto, Ontario, M8Y 1H8. Tel: (416) 259-6328 x 250