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Callidus Capital Announces Letter of Intent to Sell Commodity Business of C&C Resources in Significant All-Cash Transaction

September 26, 2018

TORONTO--(BUSINESS WIRE)--Sep 26, 2018--Callidus Capital Corporation (“Callidus” or the “Company”) (TSX:CBL) today announced that it has entered into a letter of intent (“LOI”) with a strategic acquirer (the “Buyer”), pursuant to which Callidus will sell the commodity division of C&C Resources Inc. (“C&C”) for all-cash consideration. With no financing contingency, the parties are working to close the transaction on an expedited basis. Under the terms of the LOI, Callidus will realize the vast majority of the current carrying value for all of the assets of C&C, which it acquired in 2017, while retaining ownership of C&C’s growth-oriented, value-added processing facilities and associated logging operations.

David Reese, President & COO of Callidus, commented, “This is a significant step toward unlocking value in Callidus’ operated assets for our shareholders. This transaction affirms our investment strategy and internal valuations, generating significant cash from C&C’s commodity division, representing the vast majority of the carrying value of the entire C&C business. Most importantly, we retain the value-added processing division, which has been central to our investment thesis. I look forward to a quick close on this transaction, and to continuing to work with C&C’s high calibre management team to unlock further value for our shareholders.”

Under the terms of the letter of intent, Callidus will sell C&C’s Foothills and Edgewood operations in Alberta and Saskatchewan, including certain assets of Westside Logging Ltd. that are associated with the Edgewood operation. This represents the commodity division of C&C. Callidus will continue to own C&C’s growth-oriented, value-added operations, including the Quesnel, B.C., sawmill, processing facilities and associated logging operations, as well as a recently acquired mill in Cranbrook, B.C., and will explore further monetization opportunities subsequent to closing.

Callidus and the Buyer have agreed to an exclusivity period and completion of the transaction is subject to execution of definitive agreements in respect of the transaction. The LOI states that the definitive agreement will not contain any due diligence, employment or financing conditions, but in addition to standard conditions of closing, the Buyer’s obligation to complete the transaction will be subject to obtaining all material consents and necessary regulatory approvals, no material adverse change, and no events that would adversely affect the Buyer’s ownership or operation of the companies and assets being purchased, or restrict the parties from completing the transaction. Closing is expected to occur in the fourth quarter of 2018.

About Callidus Capital Corporation

Established in 2003, Callidus Capital Corporation is a Canadian company that specializes in innovative and creative financing solutions for companies that are unable to obtain adequate financing from conventional lending institutions. Unlike conventional lending institutions who demand a long list of covenants and make credit decisions based on cash flow and projections, Callidus credit facilities have few, if any, covenants and are based on the value of the borrower’s assets, its enterprise value and borrowing needs. Further information is available on our website,  www.calliduscapital.ca.

View source version on businesswire.com:https://www.businesswire.com/news/home/20180925006313/en/

CONTACT: For further information:

Investor Relations

(416) 945-3240

investor@calliduscapital.ca

KEYWORD: NORTH AMERICA CANADA

INDUSTRY KEYWORD: NATURAL RESOURCES OTHER NATURAL RESOURCES PROFESSIONAL SERVICES FINANCE

SOURCE: Callidus Capital Corporation

Copyright Business Wire 2018.

PUB: 09/26/2018 01:28 AM/DISC: 09/26/2018 01:28 AM

http://www.businesswire.com/news/home/20180925006313/en

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