TORONTO, ONTARIO--(Marketwire - Aug. 3, 2012) -
NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES
Automodular Corporation (TSX:AM) ("Automodular" or "the Corporation") announces that the Toronto Stock Exchange ("TSX") has accepted the Corporation's notice of intention to make a normal course issuer bid. Under the terms of the normal course issuer bid, Automodular may acquire up to 1,317,000 common shares, representing 10% of the public float of Automodular's common shares issued and outstanding as of August 1, 2012, as defined by the policies of the TSX. In the opinion of the Board of Directors of Automodular, its common shares have over the last couple of months traded in a price range that does not reflect the underlying value of the Corporation and its strong financial position. Accordingly, depending upon future price movements and other factors, Automodular believes that its outstanding common shares represent an attractive investment and a desirable use of a portion of its corporate funds. Automodular's strong cash position allows for the implementation of the bid without adversely affecting other growth opportunities.
As of August 1, 2012, the Corporation had 20,393,679 common shares outstanding. The average daily trading volume of Automodular's shares over the last six completed calendar months was 72,343. Accordingly, under TSX rules and policies, Automodular is entitled on any trading day to purchase up to 18,085 common shares. Once a week, in excess of the daily 18,085 common share repurchase limit, Automodular may also purchase a block of shares not owned by an insider (i) having a purchase price of $200,000 or more, (ii) of at least 5,000 common shares having a purchase price of at least $50,000, or (iii) of at least 20 board lots of common shares which total 150% of the average daily trading volume in accordance with TSX rules.
The normal course issuer bid will begin on August 8, 2012 and purchases may commence on or about August 13, 2012, when Automodular comes out of its regular quarterly blackout period. The normal course issuer bid will terminate on August 7, 2013, or on such earlier date as Automodular may complete its purchases pursuant to the notice of intention to make a normal course issuer bid filed with the TSX. All shares purchased by the Corporation will be on the open market through the facilities of the TSX in accordance with the rules, regulations and policies of the TSX and will be cancelled. The prices that Automodular will pay for any of the common shares purchased will be the market price of the shares at the time of acquisition, determined in accordance with the rules of the TSX.
To the knowledge of Automodular, no director currently intends to sell any common shares under this bid. To the knowledge of Automodular one senior officer currently intends to sell up to 30,000 common shares during the course of this bid. To the knowledge of Automodular, two insiders holding 10% or more of any class of equity securities of Automodular may sell shares during the course of the normal course issuer bid depending on factors including but not limited to the depth of the market bid, assessment of business value and liquidity needs. However, sales by such persons through the facilities of the TSX may or may not occur if the personal circumstances of any such person change or any such person makes a decision unrelated to these normal course purchases. The benefits to any such person whose shares are purchased would be the same as the benefits available to all other holders whose shares are purchased. There are no agreements in place to sell securities under the normal course issuer bid.
Automodular is a supplier of sub-assembly, sequencing and transportation services to the automotive industry - Ford Motor Company's Oakville Assembly Plant - and the renewable energy industry - Vestas Nacelles A/S. The Company has three operating facilities and employs approximately 535 people.
This press release contains forward-looking statements that involve a number of risks and uncertainties. Among the important factors that could cause actual results to differ materially from those indicated by such forward-looking statements are market and general economic conditions and the risk factors detailed from time to time in the Corporation's periodic reports filed with the Canadian securities regulatory authorities and on SEDAR at www.sedar.com. Readers are cautioned not to rely on forward-looking statements. Except as required under continuous disclosure obligations, the Corporation undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Automodular does not provide financial outlooks.