On July 30, 2015, BSM Technologies Inc. (“BSM”) and Webtech Wireless Inc. (“Webtech Wireless”) entered into a definitive arrangement agreement (the “Arrangement Agreement”) to combine their respective businesses in a “merger of equals” type transaction via a plan of arrangement (the “Arrangement”). Under the Arrangement Agreement, BSM agreed to acquire all of the outstanding common shares of Webtech Wireless (the “Webtech Wireless Shares”). As consideration under the Arrangement, each Webtech Wireless shareholder will be entitled to receive 2.136 BSM common shares (“BSM Shares”) plus $0.52 in exchange for each Webtech Wireless Share held.
If you hold your Webtech Wireless Shares through a broker or other person, please contact that broker or other person for instructions and assistance in receiving the BSM Shares and cash consideration in respect of such Webtech Wireless Shares. If you are a registered holder of Webtech Wireless Shares, in order to receive the BSM Shares and cash consideration you must complete and return the Letter of Transmittal together with the certificate(s) representing your Webtech Wireless Shares and any other required documents and instruments, to the depositary, Computershare Investor Services Inc. (the “Depositary”), in the return envelope in accordance with the instructions set out in the Letter of Transmittal. The Letter of Transmittal contains other procedural information related to the Arrangement and should be reviewed carefully.
Former Webtech Wireless Shareholders who do not deposit with the Depositary a duly completed Letter of Transmittal and certificates representing their Webtech Wireless Shares on or before the date that is six years after the Effective Date will be deemed to have abandoned and forfeited their Webtech Wireless Shares and they will not receive any Consideration in exchange; therefore, such Former Webtech Wireless Shareholder will not own any interest in BSM and will not be paid any other compensation.
For summary information about the tax considerations for former shareholders of Webtech Wireless that will have their common shares of Webtech Wireless acquired by BSM pursuant to the Arrangement, please refer to the tax language (page 36 and pages 95-109) in the Joint Management Information Circular relating to the Special Meetings of Shareholders of BSM and Webtech Wireless to be held on September 23, 2015 (the “Joint Circular”) as posted on SEDAR on August 25, 2015. Capitalized terms used (and otherwise defined herein) have the meanings set forth under the Glossary of Terms within the Joint Circular.
Webtech Wireless Shareholders residing in Canada should refer to the Canadian tax guidance (pages 36 and pages 95-103) of the Joint Circular that explains the income tax results of the exchange of Webtech Wireless Shares for BSM Shares and cash.
Important tax information for Webtech Wireless shareholders
The exchange of Webtech Wireless Shares for BSM Shares and cash pursuant to the Arrangement will result in a disposition of Webtech Wireless Shares held by each Webtech Wireless Shareholder. Accordingly, a Webtech Wireless Shareholder may realize a gain (or loss) and be subject to tax. For Canadian tax purposes, it is possible for a Webtech Wireless Shareholder
Such tax election(s) must then be filed with the Canada Revenue Agency and any applicable provincial taxation authorities in the prescribed form and within the prescribed time. The joint tax election(s) are optional. A Webtech Wireless Shareholder that is
Any Webtech Wireless Shareholder that is not exempt from Canadian income tax that would like to make a tax election is strongly encouraged to provide his/her name, mailing address and telephone number via voicemail on the BSM tax election hotline at 1-855-348-5088 or via email at firstname.lastname@example.org. A representative will contact all such Webtech Wireless Shareholders with instructions on how to make the tax election. Alternatively, all interested Webtech Wireless Shareholders may download the questionnaire here and return the completed form via e-mail to email@example.com or by regular mail to BSM Tax Election c/o PwC LLP, 18 York Street, Suite 2600, Toronto, Ontario, M5J 0B2.
The following Webtech Wireless Shareholders are NOT permitted to file a tax election:
- Webtech Wireless Shareholders that are non-residents of Canada that are not required to file a Canadian tax return. Uncertain taxpayers should contact their tax advisors.
- Webtech Wireless Shareholders that held all of their Webtech Wireless Shares in an RRSP, RRIF, TFSA or other Canadian tax-exempt plan.
In addition, Webtech Wireless Shareholders that realize a loss on the disposition of their Webtech Wireless Shares pursuant to the Arrangement will not benefit from filing a tax election. The foregoing is subject to the more detailed information as set out on page 36 and pages 95 to 109 of the August 25, 2015 Joint Management Information Circular of Webtech Wireless and BSM, a copy of which can be found on www.sedar.com. or here
Webtech Wireless Shareholders residing within the United States should refer to the United States tax guidance (pages 36 and pages 103-109) of the Joint Circular that explains the United States income tax results of the exchange of Webtech Wireless Shares for BSM Shares and cash. United States resident Webtech Wireless Shareholders should also refer to the Canadian tax guidance (pages 95-103) of the Joint Circular that explains the Canadian income tax results of the exchange of Webtech Wireless Shares for BSM Shares and cash.
United States citizens and United States resident Webtech Wireless Shareholders might find helpful the United States Internal Revenue Service tax Form 8937 called “Report of Organizational Actions Affecting Basis of Securities”.
All shareholders of Webtech Wireless should consult their own tax advisors regarding the income tax consequences of the Arrangement applicable to their particular circumstances. The tax language provided in the Joint Circular should be helpful in the discussions with your tax advisor. BSM is not responsible for the tax reporting obligations required by the shareholders of Webtech Wireless.
- BSM Technologies and Webtech Wireless to Merge
- BSM Technologies and Webtech Wireless File Joint Circular in connection with Special Meetings to approve the Merger
- Webtech Wireless Obtains Final Order for Arrangement with BSM
- BSM Shareholders Overwhelmingly Approve Arrangement with Webtech Wireless Inc.