N@N

ROCTEST LTD. ANNOUNCES EXECUTION OF DEFINITIVE AGREEMENT FOR THE ACQUISITION OF THE COMMON SHARES OF ROCTEST LTD. AT A PRICE OF

^{Published on 2010-10-20 05:35:36 - Market Wire}
 

ST-LAMBERT, QC, Oct. 20 /CNW/ - Roctest Ltd. ("Roctest") (TSX: RTT), a leading designer and manufacturer of high-precision sensors for the civil engineering market and applications in the energy, healthcare and process control industries, announced today that it has entered into a definitive agreement (the "Arrangement Agreement") pursuant to which Nova Metrix LLC, through an indirect wholly-owned subsidiary ("Nova Metrix"), will acquire all of the issued and outstanding common shares of Roctest at a price of $4.01 per share in cash, which represents a premium of 129% over the volume-weighted average price of Roctest's shares of $1.75 for the 30 trading days prior to this announcement. The transaction will be carried out pursuant to the Arrangement Agreement under a court-approved statutory plan of arrangement governed by the Companies Act (Québec) (the "Arrangement"). In addition, all outstanding stock options of Roctest will be cancelled as part of the Arrangement and each holder of Roctest stock options will receive a cash payment equal to the difference between the offer price and the exercise price per option. All dollar amounts in this press release are in Canadian dollars.

Nova Metrix, through its subsidiaries, provides measurement and control instrumentation solutions to customers around the world. Its Durham Geo Enterprises Inc. business is a leading manufacturer and supplier of geotechnical and material testing instruments and sensors. 

Two of Roctest's principal shareholders, Fonds de solidarité des travailleurs du Québec (F.T.Q) and Perlus Microcap Fund, as well as the directors and senior officers of Roctest, including François Cordeau, President and Chief Executive Officer (collectively, the "Locked-up Shareholders"), have entered into voting agreements with Nova Metrix (the "Voting Agreements") pursuant to which the Locked-up Shareholders have irrevocably agreed, subject to the terms thereof, to vote in favour of the Arrangement. The Locked-up Shareholders hold, collectively, approximately 43.8% of the outstanding common shares of Roctest. 

The transaction has been unanimously approved by the board of directors of Roctest (the "Board").  The approval by the Board followed the unanimous recommendation of a special committee of independent directors (the "Special Committee") which was formed, among other things, to review the terms and conditions of the Arrangement.  The Special Committee undertook a comprehensive review of the transaction, including seeking advice from its independent financial advisors and independent legal counsel and receiving a fairness opinion from RSM Richter Inc. to the effect that, as of the date hereof, the Arrangement is fair, from a financial point of view, to holders of Roctest common shares and stock options.  After careful consideration, the Special Committee unanimously recommended approval of the transaction to the Board, which in turn has unanimously determined that the Arrangement is in the best interests of Roctest and its shareholders, has approved the entering into of the Arrangement Agreement and unanimously recommends that shareholders vote in favour of the Arrangement. 

"The offer from Nova Metrix provides compelling value, certainty and liquidity to our shareholders while ensuring continuity for the employees of Roctest and strengthening its future growth prospects," said John LeBoutillier, Chairman of the Board and of the Special Committee. "Our Board of Directors believes that this all-cash offer, which is at a significant premium to the trading price of Roctest's shares, is the best way to maximize value while providing the Company with long-term partners who share our commitment to customers, employees and the markets we serve."

"We are pleased to welcome Roctest and its employees into the Nova family. Roctest provides Nova with complementary products, channels and geographic opportunities to better serve our customers on a global basis" said Jim Barbookles, Nova Metrix's Chairman and CEO. 

The completion of the proposed Arrangement is subject to a number of customary conditions, including the approval of the Superior Court of Québec and the approval of 75% of the votes cast by Roctest's shareholders present in person or represented by proxy at a special meeting (the "Meeting") to be convened for such purpose. It is currently anticipated that the Meeting will be held in December 2010 and that proxy materials providing details of the Arrangement, including Roctest's management proxy circular, will be mailed to shareholders in November 2010, and in any event no later than 21 days preceding the Meeting. Details concerning the record date for the Meeting, the mailing date and Meeting date will be announced in the coming days.

Pursuant to the Arrangement Agreement, Roctest is subject to customary non-solicitation covenants. In addition, Nova Metrix has the right to match any unsolicited superior acquisition proposal which Roctest proposes to accept in the exercise of its fiduciary duties after consultation with its legal and financial advisors. In certain circumstances where the Arrangement Agreement is terminated, including if the Board changes its recommendation or Roctest terminates the Arrangement Agreement to enter into a superior proposal (in the event that Nova Metrix declines to exercise its matching right), Roctest has agreed to pay Nova Metrix a termination fee of $950,000. In certain other circumstances where the transaction is not completed, Roctest is obligated to reimburse the transaction expenses of Nova Metrix up to a maximum of $450,000.

A copy of the Arrangement Agreement and the plan of arrangement relating thereto, the Voting Agreements, the management proxy circular of Roctest, the fairness opinion and other related documents will be filed with the Canadian securities regulatory authorities and will be available for viewing on the System for Electronic Document Analysis and Retrieval (SEDAR) website at [ www.sedar.com ].

The Special Committee has engaged Deloitte & Touche Corporate Finance Inc. as its independent financial advisor and RSM Richter Inc. for the purposes of rendering the fairness opinion in connection with the Arrangement. Ogilvy Renault LLP is acting as the independent legal counsel to the Special Committee. EuroConsult Capital LLC is acting as exclusive financial advisor to Nova Metrix and Fasken Martineau DuMoulin LLP is acting as Nova Metrix's legal advisor. Shareholders should consult their own tax and investment advisors with respect to the Arrangement, details of which will be contained in the management proxy circular of Roctest.

About Roctest Ltd.

Roctest designs, manufactures and markets sensors and high-precision measuring instruments for the civil engineering market and applications in the energy, healthcare and process control industries. Roctest is recognized for its leading-edge technology, the quality of its technical expertise and its product development capabilities for challenging and demanding environments. Its products are mainly sold internationally. The shares of Roctest are listed on the Toronto Stock Exchange under the symbol RTT. To reach Roctest Ltd. via the worldwide web, log on to [ www.roctest.com ].

About Nova Metrix LLC

Nova Metrix is a privately held company based in Woburn, Massachusetts, USA. Nova Metrix, through its subsidiaries and affiliates, designs, manufactures and markets test and measurement instrumentation solutions.  For more information about Nova Metrix, go to [ www.nova-metrix.com ].

Caution concerning forward-looking statements

Except for historical information provided herein, this press release may contain information and statements of a forward looking nature concerning the future performance of the Company. These statements are based on suppositions and uncertainties as well as on management's best possible evaluation of future events, and as such involve a number of risk factors. Such factors may include, without excluding other considerations, risks related to foreign exchange fluctuations, evolution in customer demand for the Company's products and services, the impact of price pressure from competitors and general market trends, as well as economic and geopolitical changes. As a result, readers are advised that actual results may differ from expected results. The Company does not update or revise publicly its forward-looking statements, except as may be required under applicable law.

%SEDAR: 00002564EF