Blueprint
News Release
Brekford Announces Proposed Terms for Sale of Vehicle Services
Business to LB&B Associates
- Consideration Includes $6.0 Million Plus 19.9% Equity Interest
-
HANOVER, Maryland – December 23, 2016 – Brekford
Corp. (OTCQX: BFDI), a leading
public safety and security technology service provider of fully
integrated automated traffic
safety enforcement (“ATSE”) solutions, parking and
traffic enforcement solutions, and an end-to-end suite of
technology solutions for public safety vehicles and mobile workers,
announced today that it has entered into a non-binding letter of
intent (“LOI”) to sell substantially all assets, and
certain specified liabilities, of its vehicle services business to
LB&B Associates Inc. (“LB&B”), headquartered in
Columbia, Maryland. LB&B is a diversified government services
company operating in more than twenty-five states and the District
of Columbia.
The LOI contains an exclusivity provision through January 20, 2017,
during which time the Company has agreed it will not
solicit, negotiate, entertain or accept any third-party proposals
regarding the acquisition of the subject assets.
The final transaction and closing is
subject to approval by the respective boards of directors of
LB&B and the Company. In consideration for the sale, as
currently contemplated and subject to adjustment, LB&B would
pay Brekford approximately $6 million. In addition, Brekford would
receive a 19.9% equity interest in the entity that acquires the
assets.
“We are thrilled about the prospect of completing this
transaction with LB&B,” commented Rod Hillman, President
and COO of Brekford. “The vision set forth in our previously
announced letter of intent with Keystone Solutions is moving
forward as contemplated. Brekford’s impeccable reputation as
a leading public safety solutions provider will be magnified with
the added resources, excellent management team, and national
presence of LB&B. Additionally, our automated traffic safety
enforcement (“ATSE”) business will benefit greatly, as
the proceeds from the transaction will allow us to retire existing
long-term debt and provide sufficient working capital to execute
our aggressive international expansion strategy. We are already
working closely with the Keystone and Firestorm management teams to
introduce a completely new business strategy to the ATSE
industry.”
The proposed sale is in keeping with the letter of intent signed
between Brekford and Keystone Solutions, Inc.
(“Keystone”) on December 6, 2016, with a condition to
sell the vehicle upfitting business to a company with the resources
to grow the business nationally. LB&B has been in business
since 1992, and currently operates nationwide providing diversified
services such as facilities management, transportation and
distribution, security, simulation systems support and training,
and base operations support for both federal government and private
sector clients. Brekford’s longstanding reputation as a
leader in public safety technology solutions for law enforcement
and government agencies will provide an excellent enhancement to
LB&B’s portfolio of services. Likewise, LB&B’s
logistics capabilities and nationwide footprint will enable it to
expand the public safety upfitting business dramatically in the
coming years.
“LB&B has a decades-long track record and reputation for
providing superior customer service to our government and
commercial clients,” said Rick Franz, Executive Senior Vice
President and co-owner of LB&B. “Adding Brekford’s
vehicle upfitting services and public safety expertise, especially
with state and local government agencies, provides us a platform
for significant national growth of our business. With the new
company formed by Brekford’s pending merger retaining a
minority ownership interest in the upfitting business, it
demonstrates a belief in the long-term potential. We look forward
to working with the Brekford and Keystone management teams beyond
the closing of this deal.”
The LOI
is non-binding and any agreement is subject to the negotiation and
execution of a definitive transaction agreement, which may vary
from the terms set forth in the LOI. A final transaction also is
anticipated to be subject to material conditions for a transaction
of this nature. Accordingly, there can be no assurance that a
definitive agreement will be reached by the companies or the final
terms of any such agreement.
About Brekford Corp.
Brekford Corp. provides state-of-the art public safety technology
and automated traffic enforcement solutions to municipalities, the
U.S. military, various federal entities and other public safety
agencies throughout the United States. Its services include
automated speed and red light camera enforcement programs, parking
enforcement solutions and an end-to-end suite of technology and
equipment for public safety vehicle upfitting. Brekford's
combination of upfitting services, cutting-edge technology, and
automated traffic enforcement services offers a unique 360-degree
solution for law enforcement agencies and
municipalities.
The Company is headquartered in Hanover, Maryland, and its common
stock is traded on the OTC Markets under the symbol "BFDI."
Additional information on Brekford can be accessed online at
www.brekford.com.
About LB&B Associates Inc.
LB&B
Associates Inc. is a diversified services company operating in over
twenty-five states, the District of Columbia, and overseas
locations. Its services include facilities management, operations
and maintenance, logistics support, simulation systems support and
training, base operations support, and commercial support. More
than 1,300 associates nationwide provide a broad range of services
to federal agencies, state governments, commercial businesses, the
military, NATO, hospitals, churches, research centers, and
educational facilities. Key customers include the U.S. Navy, Air
Force, Army, Marine Corps, GSA, National Archives, HHS, and
DHS.
LB&B is headquartered in Columbia, Maryland.
Additional information can be accessed online at
www.lbbassociates.com.
Forward-Looking Statements
This press release contains forward-looking statements within the
meaning of that term in Section 21E of the Securities Exchange Act
of 1934, as amended. Words such as "anticipate," "expect,"
"project," "intend," "plan," "believe," "target," "aim," "should,"
and words and terms of similar substance and any financial
projections used in connection with any discussion of future plans,
strategies, objectives, actions, or events identify forward-looking
statements. Forward-looking statements include, among others, those
concerning our expected financial performance and strategic and
operational plans, as well as all assumptions, expectations,
predictions, intentions or beliefs about future events. These
statements are based on the beliefs of our management as well as
assumptions made by and information currently available to us and
reflect our current views concerning future events. As such, they
are subject to risks and uncertainties that could cause our results
to differ materially from those expressed or implied by such
forward-looking statements. Such risks and uncertainties include,
among many others: the risk that any projections, including
earnings, revenues, expenses, synergies, margins or any other
financial items that form the basis for management's plans and
assumptions are not realized; a reduction in industry profit
margin; requirements or changes affecting the business in which we
are engaged; our ability to successfully implement new strategies;
operating hazards; competition and the loss of key personnel;
changing interpretations of generally accepted accounting
principles; continued compliance with government regulations;
changing legislation and regulatory environments; and the general
volatility of the market prices of our securities and general
economic conditions. Readers are referred to the documents filed by
Brekford Corp. with the SEC, specifically the Company's most recent
reports filed on Form 10-K and Forms 10-Q, which further identify
important risks, trends and uncertainties which could cause actual
results to differ materially from the forward-looking statements in
this press release. Brekford Corp. expressly disclaims any
obligation to update any forward-looking statements.
Company
contact:
Rod
Hillman, President and COO
(443)
557-0200
investors@brekford.com
