NEW YORK--(BUSINESS WIRE)--On May 10, 2018, 683 Capital Management, LLC, a holder of more than 17% of the outstanding public warrants to purchase common stock of Cision Ltd. (NYSE: CISN) (“Cision”), sent an open letter to Cision’s Board of Directors expressing its view that the exchange offer and warrant solicitation are unlawful and should be rescinded. 683 Capital Management is making its letter public given Cision’s failure to meaningfully respond to its concerns and to inform all Cision stakeholders of potential violations of law.
The full text of the letter is set forth below:
|May 10, 2018|
|Board of Directors|
|130 East Randolph Street, 7th Floor|
|Chicago, Illinois 60601|
We are the holders of more than 17% of the outstanding public warrants to purchase common stock of Cision Ltd. (“Cision”). On April 17, 2018, Cision announced that it had commenced an exchange offer and consent solicitation relating to certain of its outstanding warrants. Pursuant to the exchange offer, Cision is offering the holders of its warrants the opportunity to receive 0.26 of an ordinary share for each warrant. Concurrently, Cision is also soliciting consents from holders of the warrants to amend the warrant agreement governing the warrants. The amendment will permit Cision to require that each outstanding warrant be converted into 0.234 ordinary shares, a ratio 10% less than the ratio applicable in the exchange offer.
Cision’s offer threatens an “exchange or you get less” proposition, in an unfair attempt to coerce its own warrantholders to forfeit value. This coercion serves no apparent business purpose other than to transfer value from warrantholders to shareholders. These shareholders include wholly conflicted, company insiders holding both shares and warrants and whose consent appears illegitimate.
We believe the exchange offer and consent solicitation are unlawful and should be immediately rescinded.
On April 30, 2018, our legal counsel sent a letter to Cision’s Chief Financial Officer, Jack Pearlstein, objecting on our behalf to the exchange offer and warrant solicitation based on the fact that as an exempted company incorporated in the Cayman Islands that is not listed on the Cayman Islands Stock Exchange, it is prohibited, under applicable Cayman Islands’ law, from making any invitation to the public in the Cayman Islands to subscribe for any of its securities. In our view, Cision is offering shares in the Cayman Islands in violation of applicable law, as the exchange offer makes no carve out for warrant holders in the Cayman Island and Cision has disclosed that one of its largest warrant holders is a Cayman entity.
Our legal counsel also noted in this letter that under the warrant agreement governing the terms of the warrants, which agreement is governed under New York law, all contracts imply a covenant of good faith and fair dealing. The covenant of good faith and fair dealing embraces the pledge that neither party shall do anything which will have the effect of destroying or injuring the right of the other party to receive the fruits of the contract. Accordingly, under New York law, the exchange offer and consent solicitation is unlawful, as they will undoubtedly destroy a significant amount of the value of the warrants held by holders and prevent warrantholders from realizing the right to benefits originally set forth in the warrants when purchased.
On May 2, 2018, our legal counsel sent a second letter to Citigroup Global Markets, Inc., who is acting as the dealer manager for the exchange offer and consent solicitation, conveying our concerns that the Registration Statement and Prospectuses relating thereto do not accurately disclose the legal risks presented by the exchange offer and warrant solicitation in violation of federal securities laws.
On May 7, 2018, our legal counsel received a response from Cision’s legal counsel’s dismissing our concerns and conveying that the Company would not be rescinding the exchange offer. We received no response from Citigroup Global Markets, Inc. In our view, not only will this exchange offer and consent solicitation destroy value for warrantholders, it may subject Cision to significant penalties for carrying on business in the Cayman Islands in contravention of its laws.
Given the manifest unfairness of this coercive “offer” and these grave consequences, we have written to the Securities and Exchange Commission to express our view that Cision may have possible ongoing violations of federal securities laws. Reserving all rights, we have also determined to issue this letter publicly to inform all other stakeholders in Cision of these potential violations and the Board’s failure to meaningfully respond to our concerns. We hope with public pressure, the Board will finally act to address these potential violations of law and unlawful coercion.