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Gendis special committee to back going-private deal

A special committee comprising Gendis Inc. independent directors recommended in favor of a going-private transaction.

The company struck a support agreement with a company owned and controlled by CEO James Cohen, which will offer to purchase all Gendis shares it does not already possess for C$5.25 apiece in cash.

In the event the offer is successful, Gendis will call a special meeting of shareholders to approve a second-step transaction, either through share consolidation or amalgamation, in which case the shareholders who do not tender to the offer will receive cash consideration of C$5.25 apiece.

James Cohen, his siblings and their various related entities own an aggregate of 72.45% of Gendis' share capital and have signed support agreements in which they agreed to directly or indirectly fund the offer. A company controlled by James Cohen, Anna-Lisa Cohen and Anthony Cohen will provide funding to the wholly owned company to enable it to buy the shares tendered under the offer.

The group will also not tender any shares in the offer and will vote their respective shares in favor of the second-step transaction at the second-step meeting.

In addition, the wholly owned company entered into lock-up arrangements with certain other stockholders, who agreed to tender an aggregate 1,886,033 Gendis shares in the offer. The locked-up shares represent roughly 54.85% of the issued and outstanding share capital, excluding shares held by the Cohen family and related entities.

The deal is subject to regulatory review and approval. Gendis' board reserves the right to terminate the agreement in the event of a superior proposal.