Qvantel enters strategic transaction to acquire Optiva

Optiva (RKNEF) entered into a strategic transaction with Qvantel. The combination brings significant scale and financial strength, enabling communication service providers to accelerate growth, diversify services and unlock new monetization opportunities in the AI era. The joint portfolio will offer a full suite of best-of-breed products that are AI enabled. With the enhanced scale, the combined companies provide CSPs with an agile and trusted alternative to legacy vendors. Pursuant to the terms of the arrangement agreement Qvantel will acquire all of the issued and outstanding common shares of Optiva and the $108.6 million principal amount of 9.75% senior secured PIK toggle notes plus accrued interest which were initially due July 20, 2025 will be cancelled in exchange for a combination of cash consideration, new notes of Qvantel, shares of Qvantel and warrants to purchase additional shares of Qvantel. The Transaction will be implemented by way of a statutory plan of arrangement under Section 192 of the Canada Business Corporations Act. Completion of the Transaction is subject to customary conditions, including, among others, court approval, approval of holders of Optiva Shares and holders of PIK Notes and the approval of shareholders of Qvantel. Pursuant to the terms of the Arrangement Agreement, among other things: Cash Consideration Per Share: The Shareholders will receive $0.25 per Optiva Share held. Exchange of Debt: The Noteholders will ultimately receive: voting shares of Qvantel at a ratio of 102.236 Qvantel Shares for each $1,000 principal amount of PIK Notes, representing in aggregate approximately 22.4% of Qvantel Shares outstanding post-closing; senior secured notes to be issued by Qvantel in the aggregate principal amount of $25 million, subject to adjustment in certain circumstances in accordance with the Arrangement Agreement; warrants to purchase such number of additional Qvantel Shares as is equal to 3% of the outstanding Qvantel Shares on a post-closing basis; a cash payment at closing, to the extent Optiva has a cash surplus at closing above a specified cash target; and a deferred cash payment payable post-closing up to a maximum aggregate amount of $700,000, to the extent there are surplus accounts receivables and certain such accounts are collected within a specified period post-closing, which in the case of and shall be on a pro rata basis among the Noteholders based on the aggregate principal amount of PIK Notes held by such Noteholder prior to the Effective Time.